Corporate Director Removal and Board-Vacancy Requirements in West Virginia

At a glance

Requirements one by one

W. Va. Code §§ 31D-1-101, 31D-1-103, and 31D-1-150 identify the West Virginia Business Corporation Act, its ordinary domestic for-profit corporation, and the priority of special-corporation chapters when inconsistent.

Removal is meeting-only and never requires cause by default

W. Va. Code § 31D-8-808(a) permits shareholders to remove one or more directors with or without cause. Unlike many model-act states, this section states no articles option making removal cause-only.

Under § 31D-8-808(c), votes cast to remove must exceed votes cast not to remove. W. Va. Code § 31D-7-727 generally permits the articles to require a greater shareholder vote.

Only the voting group that elected a director may participate in removal. West Virginia gives each entitled shareholder or designated voting group a cumulative-voting right under § 31D-7-728, and election-sufficient votes against removal protect the director. Classification under § 31D-8-806 does not create a cause rule and requires at least nine directors.

Notice must identify removal

W. Va. Code § 31D-8-808(d) permits removal only at a meeting called for that purpose whose notice states removal. The specific meeting-only rule leaves no ordinary written-consent removal route under § 31D-7-704.

W. Va. Code §§ 31D-7-702 and 31D-7-705 allow the board or an articles- or bylaw- authorized caller to call the meeting and require ten-to-sixty-day purpose- stated notice. Holders of ten percent of votes on the proposed issue may demand the meeting by default; the articles may lower that percentage or raise it no higher than twenty-five percent. Section 31D-7-703 supplies a court-ordered meeting route when a valid demand is not timely noticed or held as noticed.

The ordinary removal provisions state no director statement or hearing right and no separate delayed-effective rule.

A qualifying shareholder agreement can change the manner

W. Va. Code § 31D-7-732 recognizes a qualifying agreement that may establish directors, their terms, and their manner of selection or removal even when inconsistent with the Act. It must be in the articles or bylaws and approved by all then-shareholders, or signed by all then-shareholders in a writing made known to the corporation. It defaults to ten years unless it provides otherwise and ends if the shares become listed or regularly traded in the stated market.

Judicial removal requires conduct and best-interest findings

Under W. Va. Code § 31D-8-809, the corporation or shareholders holding at least ten percent of the outstanding shares of any class may seek judicial removal. The court must find fraudulent or dishonest conduct or gross abuse of authority or discretion toward the corporation and that removal is in the corporation's best interest.

The court may prescribe a reelection bar, and shareholder plaintiffs must make the corporation a defendant. The Act states no ordinary board-removal or automatic-disqualification route.

A later resignation date needs board agreement

W. Va. Code § 31D-8-807 requires written notice to the board, its chair, or the corporation. Resignation is effective on delivery unless the board agrees to a later effective date. The section states no unilateral future-event, withdrawal, or irrevocability rule.

Shareholders and directors may fill the vacancy

Unless the articles provide otherwise, W. Va. Code § 31D-8-810 authorizes the shareholders or board to fill a vacancy, including a newly created seat. If the remaining directors are below quorum, an affirmative majority of all remaining directors may fill it.

For a voting-group seat, subsection (b) restricts only a shareholder fill to that group's holders. It does not state the same-group-director exclusivity found in many newer model-act provisions. A vacancy occurring at a specific later date may be filled early, but the successor does not take office until it occurs.

If no directors remain, shareholders are still an express filler. The demand and court-order provisions in §§ 31D-7-702 and 31D-7-703 remain available subject to their thresholds and conditions.

Every vacancy filler receives a next-election term

W. Va. Code § 31D-8-805(d) ends the term of a director elected to fill any vacancy at the next shareholder meeting at which directors are elected. The predecessor's unexpired term is not the default. The director then holds over until a successor is elected and qualifies or the board size decreases.

What trips people up

West Virginia combines default cumulative voting with meeting-only removal. The removal vote is not just a comparison of votes cast for and against: a director also survives when election-sufficient cumulative votes oppose removal.

The class-seat vacancy provision is asymmetric. Only the shareholder filler is expressly limited to the class electorate; the statute does not impose the same restriction on directors filling the seat.

Common questions

Can West Virginia shareholders remove a director without cause?

Yes. Section 31D-8-808(a) permits removal with or without cause and states no articles-created cause-only exception.

Can shareholders remove by written consent?

Not under the ordinary removal provision. Section 31D-8-808(d) says removal occurs only at a purpose-called meeting whose notice states removal. A qualifying § 31D-7-732 shareholder agreement may establish another manner.

Can a board below quorum fill a vacancy?

Yes. Section 31D-8-810(a)(3) requires the affirmative vote of a majority of all directors remaining in office.

Can a West Virginia court remove a director?

Yes. Section 31D-8-809 requires the specified fraudulent, dishonest, or gross- abuse conduct plus a corporate-best-interest finding. A qualifying shareholder group needs at least ten percent of the outstanding shares of any class.

Statutes and sources

• W. Va. Code §§ 31D-7-702 to -705, 31D-7-727 to -728, and 31D-7-732. Govern special meetings, notice, consent, greater votes, cumulative voting, and the qualifying shareholder agreement.
• W. Va. Code §§ 31D-8-805 and 31D-8-807 to -810. Govern replacement terms, resignation, shareholder and judicial removal, and vacancy filling.