Uk Small Business, Theft by Former Director

**1LittleCompany** · 03-26-2010, 05:39 PM

Hi Sorry I know this is a US law forum but we don't have much like it in the UK so I'm hoping some laws may be similar.

A wealthy lady invested into our company when we started it, to the sum of £16,000

This meant there were now four directors. Me and my two friends, plus the investor. We all had 25% each.

The investor stormed out last week in their 3rd outburst, shouting and swearing.

We received an email from her saying she resigns as a director and will now be just a silent partner, and that she had taken £1,000 from our account as repayment of a loan (a loan which never existed, the investor bought some items for the office off her own back, we did not ask for them but she wanted a nicer looking office and offered to buy light fittings, etc... so we just let her do it, there was never any discussion of this being a loan).

We've cancelled the investors card and cheque book. The investor was a signatory on the account but just took the £1,000 without agreement from anyone else.

She threatened to sabotage a new job we acquired by approaching the client, a threat which she did not carry out but I still see that as a low thing to do.

We have only been trading for 8 months and at the moment we're just covering costs so the shares are worthless, at the moment.

The investor wasn’t taking a wage from the company (she was only there a couple of hours per week doing the books). There was no shareholders agreement in place.
Today we had a meeting with the former director, she admitted she took the £1000 because she were angry and offered to return it, although she still says that they were entitled to it as it was a loan (despite us never knowing of any such loan).

Some more developments are that they say they only gave us £225 for the 25% of our company and the rest (£15,775) was a loan. This was not the agreement. The shares say £225 but we were assured this was just a nominal figure at the time and that it was the £16000 that was the investment, we had no knowledge as we were never informed that any loan was taking place... this means she gets 25% of our company and most of her investment back.

Next up is the fact that we discovered, to our amazement, she secretly resigned as a director over two months ago but never informed us. This means that she wasn't actually a director when she took the money from the account. She was still a signatory but wouldn't she have had to have told us about the resignation so we could decide if she should stay as a signatory?

Finally, the £1,000 which was taken (the supposed loan), it turns out it wasn't put through our books at all. When they purchased the items they put it through the books of their own company as drawings.

I've read up about Fiduciary duty, and it does seem that she broke the rules there but if she wasn't a director (due to the secret resignation) would that mean that she was still breaking the rules as was looking after our accounts but not as the financial director?

She told us today that she has "Very deep pockets" and that if it goes to court the legal costs would ruin us but she can afford to pay it. Is this true, have we no defense because they're wealthy and we're a fledgling company barely turning a profit yet?

Thank you in advance for any help.