Partnerships and the disqualification regime
Produced in partnership with Katherine Hallett of ThreeStone
Partnerships and the disqualification regime

The following Restructuring & Insolvency guidance note Produced in partnership with Katherine Hallett of ThreeStone provides comprehensive and up to date legal information covering:

  • Partnerships and the disqualification regime
  • Disqualification
  • Application of the IPO 1994
  • Application of the LLPR 2001
  • Grounds for partnership disqualification
  • Unfit behaviour in connection with an insolvent company—section 6
  • Unfit behaviour after an investigation—section 8
  • Breach of competition law—sections 9A–9E
  • Wrongful trading—section 10
  • Instructing an unfit director —sections 8ZA–8ZE
  • more

Disqualification

Directors

Principally, disqualification proceedings are brought against directors of companies. Proceedings are brought pursuant to the Company Directors Disqualification Act 1986 (CDDA 1986).

The CDDA 1986 provides for directors who have been found guilty of misconduct to be disqualified from acting as a company director for a specified period.

In summary, there are a number of grounds upon which disqualification proceedings may be brought against directors:

  1. conviction for an indictable offence in connection with a companyCDDA 1986, s 2

  2. persistent breaches of companies legislation in connection with returns etcCDDA 1986, s 3

  3. fraud etc during the winding-upCDDA 1986, s 4

  4. conviction for default regarding returns etcCDDA 1986, s 5

  5. conviction abroad in connection with a companyCDDA 1986, s 5A

  6. unfit behaviour in connection with an insolvent companyCDDA 1986, s 6

  7. unfit behaviour after an investigationCDDA 1986, s 8

  8. breach of competition lawCDDA 1986, ss 9A-9E

  9. wrongful tradingCDDA 1986, s 10

Furthermore, disqualification proceedings may be brought against any person instructing an unfit director.CDDA 1986, ss 8ZA-8ZE

In addition, an undischarged bankrupt is automatically disqualified as a director.CDDA 1986, s 11

This Practice Note does not directly cover disqualification proceedings against directors of companies.

For further reading, see Practice Note: How can a director be disqualified as a company director?

Partners

This Practice Note covers disqualification proceedings specifically against partners.

There are three types of partnerships:

  1. Partnerships under the Partnership Act 1890 (PA 1890)PA 1890

  2. Limited partnerships under the Limited Partnership Act 1907 (LPA 1907); andLPA 1907

  3. Limited liability partnerships (LLPs) under the Limited Liability Partnerships Act 2000 (LLPA 2000)LLPA 2000

Unless otherwise stated,