Partnerships and the disqualification regime
Produced in partnership with Katherine Hallett of Three Stone Chambers
Partnerships and the disqualification regime

The following Restructuring & Insolvency guidance note Produced in partnership with Katherine Hallett of Three Stone Chambers 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—section 8
  • Instructing an unfit director—sections 8ZA–8ZE
  • Breach of competition law—sections 9A–9E
  • Wrongful trading—section 10
  • 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 company

  2. persistent breaches of companies legislation in connection with returns etc

  3. fraud etc during the winding-up

  4. conviction for default regarding returns etc

  5. conviction abroad in connection with a company

  6. unfit behaviour in connection with an insolvent company

  7. unfit behaviour

  8. breach of competition law

  9. wrongful trading

Furthermore, disqualification proceedings may be brought against any person instructing an unfit director.

In addition, an undischarged bankrupt is automatically disqualified as a director.

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)

  2. Limited partnerships under the Limited Partnerships Act 1907 (LPA 1907), and

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

Unless otherwise stated, in this note