It Depends – What happens to the director of a company when they die?

It Depends – What happens to the director of a company when they die?

16 August 2021 Topics: Professional advisers, Estate administration and disputes, Estate planning

In this week’s edition of ‘It depends’, partner Hayley Mitchell talks us through what happens when a company director dies.


Welcome to another edition of It depends. Today, I’m going to talk through what happens to a director of a company when they die.

What happens to the director of a company when they die?

Well, it’s fairly obvious that they can no longer act in that director role. So, they need to be removed and potentially replaced. The Constitution of the company may automatically remove the director on death. However, if this is not provided for in the Constitution itself, then the remaining directors of the company should resolve to note the deceased director’s death and update the company records with ASIC. Ideally, ASIC should be updated within 28 days of the date of death to avoid a late fee being payable.

What happens if it was a single director company?

In terms of removing and replacing that director, this will depend on the terms of the Constitution and the makeup of the shareholders in the company. If the sole director was also the sole shareholder of the company then The Corporations Act allows the executor of the deceased director to appoint a new director, and the executor may choose to appoint themselves in that position. If the director was not the sole shareholder then it will be a matter of the shareholders calling a meeting and voting on the appointment of the new director.

What if the deceased was not the sole director?

If the director was not the sole director of the company, the remaining directors can continue to run the company, provided that they meet the minimum number of directors required under the company constitution. The Constitution may also provide that those remaining directors can appoint an additional director to replace the deceased. It’s really a matter of checking the terms of the Constitution and following the rules there. If you’re dealing with a company where a director has died, please contact a member of our private client team and we can guide you through the process.



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This publication is for information only and is not legal advice. You should obtain advice that is specific to your circumstances and not rely on this publication as legal advice. If there are any issues you would like us to advise you on arising from this publication, please let us know.