Section 314 CAMA 2020
Section 314 Companies and Allied Matters Act is about Directors with unlimited liability in respect of a limited company. It is under Chapter 11 (Directors) of the Act.
(1) In a limited company the liability of the directors, managers or managing director, may, if so provided by the memorandum, be unlimited.
(2) In a limited company in which the liability of a director, manager is unlimited, the directors and managers of the company and the member who proposes a person for election or appointment to the office of director or manager, shall add to that proposal a statement that the liability of the person holding that office is unlimited, and before the person accepts the office or acts therein, notice in writing that his liability are unlimited is given to him by the promoters of the company, the directors of the company, any managers of the company and the Secretary of the company.
(3) If any director, manager, or promoter makes default in adding such a statement, or if any promoter, director, manager or secretary makes default in giving such a notice, he shall is liable to a penalty in such amount as the Commission shall specify in its regulations and is also liable for any damage which the person so elected or appointed may sustain from the default.
