Nominated director tenure cannot end by implication when appointing shareholders lose required shareholding under the articles.

A nominated director does not vacate office by implication merely because the shareholders who appointed him cease to hold the shareholding required by the articles. The articles specified the circumstances in which such a director could cease to hold office, including a written request by the appointing party and other express contingencies, and no additional disqualification could be imported unless the contractual scheme could not otherwise operate or the language necessarily required it. The loss of the appointing group's power to remove the director did not itself create a vacancy, as the articles did not provide for automatic termination on that basis. The appeal failed.

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Issues: Whether a nominated director vacates office by implication when the shareholders entitled to appoint him cease to hold the shareholding required by the articles, even though no such disqualification is expressly provided in the articles or in the statutory provisions governing vacation of office.

Analysis: The articles expressly provided the modes by which a nominated director could cease to hold office, including a written request by the appointing party and other specified contingencies. A further ground of disqualification could not be imported unless it was necessary to make the contractual scheme work or was one that necessarily arose from the language used. The absence of power in the appointing group to remove the director did not itself create a vacancy, because the articles did not state that loss of such power would automatically terminate the director's tenure. The expression relied upon could not be extended to introduce a fresh ground of vacation of office not found in the articles or the statutory scheme.

Conclusion: The director did not vacate office merely because the appointing shareholders no longer held the specified shares, and the appeal failed.

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