Can a Director Resign?
A director can resign at any time as a director by giving notice to that effect. Unless there is a provision to the contrary in the corporation’s By-Laws, a director’s resignation can be oral (i.e., he/she can resign verbally during a board of directors’ meeting). Nevertheless, it is generally recommended that a corporation require a director’s resignation to be in written form for purposes of proof. In the absence of a specific provision in the By-Laws of the corporation, a director’s resignation often takes effect immediately and does not require the approval of the corporation’s board of directors. Most corporations’ By-Laws, though, contain such a requirement. A director who resigns but continues to act and present him/herself to third parties as a director of the corporation risks being considered a de facto director and, consequently, remains liable as a director.
A director can resign at any time as a director by giving notice to that effect. Unless there is a provision to the contrary in the corporation’s By-Laws, a director’s resignation can be oral (i.e., he/she can resign verbally during a board of directors’ meeting). Nevertheless, it is generally recommended that a corporation require a director’s resignation to be in written form for purposes of proof. In the absence of a specific provision in the By-Laws of the corporation, a director’s resignation often takes effect immediately and does not require the approval of the corporation’s board of directors. Most corporations’ By-Laws, though, contain such a requirement. A director who resigns but continues to act and present him/herself to third parties as a director of the corporation risks being considered a de facto director and, consequently, remains liable as a director.
