Validity of MoUs
Alok Vashishth
(Querist) 02 August 2011
This query is : Resolved
Hi,
I have resigned as a director from a pvt ltd company and also sold my shares to another director in the same company.
Does MoUs signed during my tenure as a director and shareholder still valid or has become null and void as far as I am concerned after my resignation.
Thanks
Raj Kumar Makkad
(Expert) 02 August 2011
Soon on acceptance of your resignation, your connection ends with all MOUs and Deeds having your signature being director of company though those MOUs and Deeds or Agreements still remain valid. Company in its independent entity is liable for all those deeds.
prabhakar singh
(Expert) 02 August 2011
yeah!Expert Mr. Raj kumar makkad is right,those M.O.Us. relate to Co. and not personally attributed to you for the one unique reason that a company itself is recognized in law as a juristic person having its own common seal.
Heaven 2011
(Expert) 03 August 2011
RIGHT!! me too agree.
Alok Vashishth
(Querist) 04 August 2011
Let me put more details:
I was a director and shareholder in a pvt ltd company, involved in real estate business. We were 5 promoters/ director in the company.
We signed a MoU in 2007 that company is acquiring land in a village near Mumbai in the name of directors, instead of company. Land were registered in the names of managing director and executive director.
I was just a director and also bought some piece of land there as an investment. I made this payment in cash from my own pocket.
Now, since I have resgined from company, will MoU signed earlier is valid and can company blackmail me and try to say that the land which I have bought in my personal capacity belongs to company as per MoU.
Abhishek Marvi
(Expert) 04 August 2011
if u mention in saledeed your personal name there is no problem but u mention director of this company then u will be effect in so far as if u not mention company name.
Alok Vashishth
(Querist) 04 August 2011
In the registery of the land, there is no mention of company or MoU. It is in my name only.
Am I still covered in MoU? Can MoU have more legal weightage than Registered property document ?
malipeddi jaggarao
(Expert) 05 August 2011
In your further clarification, you said that you signed along with other directors MOU on behalf of the company that it is acquiring land in the names of directors. One of the registrations is in your name - if it is purely in your personal name without mentioning the position of Director, this transaction will not cover under MoU. If the registration is in your name, narrating that you are the Director of the company, the transaction comes under MoU. The later part of your question - MoU is valid even if you resigned, as the company is a separate legal entity and it is perpetual. MoU is an understanding that the parties to MoU will perform the duties enlisted in the MoU for a particular transaction mentioned in it. If the Registration is purely in your personal name without suffix that you are the Director, the transaction will not cover under MoU. Registration is passing of the title to the property mentioned in it.. They are two different types of documents.
Alok Vashishth
(Querist) 05 August 2011
I have a fear that remaining directors in the company might file a false complain against me citing the details of MoU that the land which is in my name belongs to company.
What should be my ideal defence ?
Nagesh Rudrakanthwar
(Expert) 05 August 2011
The property which you have acquired is on your personal name hence the other directors of the company can't black mail you for the acquisition of property. You don't need to concern as you have not mention any suffix as director of so & so company. If any condition happened & other directors started blackmailing you then you could use this suggestion as a defense.
Alok Vashishth
(Querist) 18 August 2011
Apart from above information, following point about MoU is also mentioned in the Balance Sheet of 07-08, 08-09, 09-10:
"The company has bought land in its own name as well as in the name of directors/ shareholders. The company has signed a Memorandum of Understanding date 5th July 2007 with its Directors and Shareholders, for company land purchased in the name of individual Directors/ Shareholders, declaring that the land/ property bought in the name of Directors and Shareholders shall be the sole property of the company".
Does it impact/ change the ownership of the land. Please clarify.
