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Case update: sole directors – a meeting of one?

3 February 2025

The High Court’s ruling in Re KRF Services (UK) Ltd [2024] EWHC 2978 (Ch) clarified that a sole director can be quorate – that is, enough people to constitute a valid meeting – under unamended Model Articles, regardless of the number of past directors the company has had.

KRF Services had a sole director after financial sanctions were imposed on its beneficial owner, leaving no other directors willing to join. The sole director sought to place the company into administration, but concerns arose regarding the company’s unamended Model Articles. The articles created a potential conflict between Article 7(2), which allows a sole director to make decisions, and Article 11(2), which requires a quorum of at least two directors for meetings.

Case law prior to Re KRF Services raised concerns. In Hashmi v Lorimer-Wing [2022], a sole director was not deemed quorate, partly due to bespoke amendments requiring a quorum of two directors for board meetings. Whereas, Re Active Wear Ltd [2022] supported the view that, where no modifications are made, Article 7(2) should take precedence over Article 11(2), allowing a sole director to act independently.

However, the court’s obiter view was that this principle only applies where there had only ever been a single director.

What does this mean for sole directors?

The KRF Services decision confirms that a sole director can make quorate decisions, even if the company has had multiple directors in the past. This ruling provides clarity for sole directors, reducing the risk of challenges regarding quorum. However, given the ambiguity of the drafting of Model Articles, we recommend that sole director companies amend their articles to avoid future uncertainty.

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