When they act as a director this is sometimes called acting ‘qua’ (as a) director (it’s Latin). When they act as a shareholder this is sometimes called acting ‘qua’ shareholder.

They have two roles; performing a management role at board meetings (although with small ‘owner managed’ companies there are very few – if any – actual board meetings) and a voting role, as a shareholder, on big issues at general meetings (there are even fewer of these with very small, family companies who do not often follow the rule of company law and call formal meetings to carry on company business).

With a Members’ Voluntary Liquidation and Creditors’ Voluntary Liquidation the owner managers can vote at board meeting to place a resolution before the general meeting for the members to wind-up the company … … and call a meeting of themselves ten minutes later to pass those resolutions at a general meeting. This makes the process very quick. It also ensures that ‘short notice’ of the general meeting will be used, as they are agreeing with their own decisions.

[See ‘Director’, ‘Shareholder’, ‘Board Meeting’, ‘General Meeting’, ‘Members’ Voluntary Liquidation’, ‘Short Notice’ and ‘Creditors’ Voluntary Liquidation’.]

P

Pari Passu

Pari passu is a Latin phrase meaning ‘equal footing’.

In insolvency and restructuring, ‘equal footing’ means that two or more parties who are claiming as creditors in, say, a Liquidation are treated the same (such as unsecured or trade creditors, who are paid last in the distribution of assets).

Pari passu is also common in Bankruptcy proceedings as well, as debts such as unpaid invoices will be treated equally.

[See ‘Liquidation’ and ‘Bankruptcy’.]