BLP (6)
Terms
undefined, object
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- In relation to the aims and objectives of a company, what did companies incorporated under the Companies Act 1985 have?
- The companies would have had an objects clause in their memorandums.
- Is a clause in the precedent articles of a company purporting that a company shall have no objects clause permissible? Explain.
- Yes. The effect of s. 28(1) CA 06 is to transfer the objects clause from the company's memorandum to its articles. The company can override section 28(1) as s. 21(1) CA 06 allows a company to amend its articles at any time.
- Is a clause purporting to require 10 working days' written notice for Board Meetings permissible?
- Yes - CA 06 is silent as to the notice period for BMs.
- Is a clause in a company's articles setting a quorum for board meetings permissible?
- Yes - CA 06 is silent as to the quorum for BMs.
- Is a clause purporting to prevent a chairman of a BM from having a casting vote permissible under the CA?
- Yes - CA 06 is silent as to a chairman's entitlement to a casting vote.
- Is a clause purporting to prevent the board collectively spending more than £100,000 without express shareholder approval permissible?
- Yes - CA 06 is silent on this matter
- Is a clause giving the directors the right to change the name of a company permissible?
- Yes. This clause falls within the scope of s. 77(1)(b) so it is valid and compatible. Note: company must also comply with s. 79 if this provision is ever used.
- Is a provision of a company's articles purporting to allow directors to amend the company's articles permissible?
- No. S. 21(1) CA 06 prescribes SR to amend a company's articles. This therefore means a resolution of the shareholders only.
- Is a clause purporting to require unanimity from shareholders to remove a director permissible?
- No - s. 168(1) CA 06 provides that a director may be removed by OR (50% + 1). This section of the CA does not permit qualification. The provision would not be effective.
- Is a provision of a company's articles permitting directors to appoint a secretary permissible?
- Yes, although s. 270(1) provides that a private limited company is not required to have a secretary. It is therefore open to the board of a company to have one if it wishes.
- Is a paragraph purporting that the quorum for a GM should be fixed to the number of shareholders that the company has at a given time permissible?
- This clause does not match s. 318 CA 06. For companies with two or more members, s. 318(2) provides for a quorum of two subject to the articles, therefore permissible. However, s. 318(1) sets quorum at 1 for single member companies. The act would prevail.
- Is a clause purporting to prevent the use of written resolutions permissible?
- No. S. 300 CA 06 provides that any article preventing the use of written resolutions is void.
- For a written resolution, who are the individuals entitled to vote?
- All eligible members (rather than those in attendance) so you need 50% + 1 or not less than 75% of all eligible members.