View/Open - Research Commons - The University of Waikato

of disqualification. 322 However, these are only guidelines and each case should be
decided on its own facts, and courts have wide discretion to impose the length
deemed appropriate.
The director in Re Stanford Services Ltd and others 323 was disqualified for the
period of less than two years (the case was decided under the old law in section 300
Companies Act 1985) for his part in the failure to pay the crown debts. The court did
not consider the act to be a breach of commercial morality and that it should not be
equated with actions such as trading using money which the director knew belonged
beneficially to others or the misuse of the company money for improper purposes. 324
In Re Churchill Hotel (Plymouth) Ltd and others, 325 the court declined to make a
disqualification order despite the fact that the conduct of the directors in respect of
the four companies‘ complaint had shown ‗unfitness.‘ This is because the court had
taken into consideration the fact that the director was successfully managing eight
other companies. It should be noted that the case was decided under section 300 of
the UK Companies Act 1985 which confers discretion on the court to make a
disqualification order. This discretion, however, is no longer available and the court
has to impose a mandatory two years disqualification once the person is found to be
‗unfit‘ under section 6 of the CDDA 1986. Under the section, the court is only
obliged to refer to the conduct of the director in respect of the company complaint
and not to his conduct in relation to any other companies. 326
322 See also Austin and Ramsay above n22 at [7.191].
323 [1987] BCLC 607.
324 Re Stanford Services Ltd and others [1987] BCLC 607 at 616.
325 [1988] BCLC 341.
326 Re Bath Glass Ltd [1988] BCLC 329.
389