Building Societies Act, 1989

Directors: appointment and retirement.

50.—(1) Subject to subsections (11) and (16), the directors of a building society must be elected to office either—

(a) at an annual general meeting of the society, or

(b) by postal ballot conducted during the period of 3 months preceding the date on which the annual general meeting is held,

as the rules provide.

(2) Where subsection (1) (a) applies and the number of candidates for the office of director exceeds the number of vacancies, the election of directors shall be by poll.

(3) The persons entitled to vote in an election of directors are those members of the society who in accordance with section 69 and under the rules are entitled to vote on an ordinary resolution.

(4) A person entitled to vote in an election of directors cannot be required to cast all or any of his votes.

(5) A person who is not a member of a society may, if its rules so provide, be a director.

(6) The rules of a society may impose, as a condition of a person's eligibility to be or to be nominated for election as a director of the society, a requirement that he shall hold beneficially shares in the society not less in value than the amount specified by the rules, but the maximum holding that may be required shall not exceed £500, or such other amount as may be substituted for it in regulations made by the Central Bank.

(7) The rules of a society shall not require, as conditions of the validity of a person's nomination for election as a director, that—

(a) more than 20 members join in nominating him;

(b) a nominating member be a member for more than 2 years before the date of the nomination or hold, or have at any time during that period held, shares in the society to a value greater than £250; or

(c) more than £250 be deposited with the society in connection with his candidature.

(8) The rules of a society shall not impose, as conditions of the validity of a person's nomination for election as a director, conditions in relation to matters other than those in subsections (6) and (7) except as may be approved by the Central Bank as being reasonable.

(9) The Central Bank may, by regulation, substitute for the number, the maximum period of membership, the maximum value of shares, and the maximum amount of the deposit referred to in subsection (7), such other number, period, value, or amount as it thinks appropriate.

(10) A director, other than a director who is also the chief executive of a society, shall retire from office not later than the end of the third annual general meeting of the society following the date of his election, subject to any provision in this Act or in the rules of the society for his earlier retirement and such director shall be eligible for election without nomination, subject to the rules.

(11) If the rules of a society so provide, the directors for the time being may co-opt as director to fill any vacancy on the board of directors any person who—

(a) appears to them to be fit and proper to be a director, and

(b) is not disqualified under section 64 to be a director of a building society,

not being a person who, having stood for election as a director at any election held within the preceding 16 months, was not elected as a director.

(12) A person who is co-opted under subsection (11) shall cease to hold office at the end of the next annual general meeting following his appointment, but a general meeting shall be disregarded for the purposes of this subsection if the closing date for the nomination of candidates falls before the date of the co-opted director's appointment, but he shall retire as a co-opted director at the next annual general meeting following that which is disregarded and shall be eligible for election without nomination, subject to the rules.

(13) Where in an election of directors there is a poll, whether conducted at a meeting or by way of postal ballot, the papers issued by the society for the purposes of or relating to the poll shall—

(a) show with equal prominence the name of each candidate, and

(b) arrange the names alphabetically in the order of the surnames, or if there are 2 or more candidates bearing the same surname, in the alphabetical order of their other names together with such information as will distinguish such candidates.

(14) The acts of a director shall be valid notwithstanding any defects which may afterwards be discovered in his appointment or qualification.

(15) A society shall notify the Central Bank—

(a) of all valid nominations of persons for election as directors, as soon as possible after the closing date for nominations; and

(b) of the proposed co-option of persons as directors at least 14 days before the date of the appointment;

giving in each case the information referred to in section 66 (1) and such other information as the Bank may require.

(16) The persons mentioned in section 10 (2) or a majority of them may appoint as directors to hold office until the conclusion of the first annual general meeting persons not disqualified under section 64 .

(17) In this section, “ordinary resolution”, means a resolution which will be effective without being passed as a special resolution or a conversion resolution.