Notes created using BPP materials and statute for the purpose of assisting existing BPP LPC students in BPP LPC exams only. They are
intended to be used as a supplemental tool to aid revision in conjunction with BPP materials, not as a replacement for them.
Exam technique
Why are the resolutions needed?
Tailor to client: Provides names of Ds/SH who need to attend/vote
What is the likelihood of the resolutions being passed?
Adapt plan if articles contain special provisions
Advise client on any timing issues
RESOLUTIONS LIST
Board resolution Ordinary resolution Special resolution
Passed by Directors Shareholders
What meeting Board meeting General meeting
What for Day-to-day decisions that Decisions that CA or Articles Decisions that CA or Articles
don’t require OR/SR: MA3 say require OR say require SR
OR to call GMs where
OR/SR is needed
Notice Called by any director giving S307(1) Private = GM called by notice of 14 clear
reasonable notice ie days
whatever notice is usually S307(2) Public = AGM called by notice of 21 clear
for the directors to give: days, normal GM 14 clear days
Browne v La Trinidad; s307(3) Articles may require longer period though
MA9(1) S307(4-6) GMs may be called by shorter notice if
agreed by majority of members
S310(1) Every SH and D entitled to receive notice of
GM
S311(1) GM notice must contain time/date of
meeting and the place
S311(2) Notice must state the general nature of the
business to be dealt with at the meeting
Quorum MA 11(2): may be fixed 2: s318(2) CA
from time to time by Unless only 1 member, in which case 1 is sufficient: s318(1)
directors’ decision, but
never less than 2 and
otherwise fixed at 2
Voting Simple majority (>50%): Simple majority – OVER 75% OR MORE: s283(1)
threshold MA7(1); or 50%: s282(1) (75% on the dot IS okay)
Unanimity if written (50% on the dot is not okay)
resolution: MA7(1) and
MA8
,Procedure Plans
If deadlock → Chairman
has casting vote (check if
Articles have removed this):
MA 13(1)
If 1 director abstains, he
does not count towards the
number of people voting
How counted 1 vote per director Decisions made on a show of hands: s282(3)
→ 1 vote per member: s284(2)(a)
Poll: 1 vote per share: s284(3)
BUT can change this ^ in articles: s284(4)
Show of hands used as method unless a poll vote is
demanded: MA 42
Poll vote can be demanded before/at meeting
before/immediately after show of hands: MA 44(1)
Chairman, director, 2 or more shareholders or any member
with not less than 10% voting rights can demand a poll vote:
MA 44(2)
S281(3) Where a provision of the act requires a co/members resolution and does not specify what
type, it will be an OR unless the articles require a higher majority
S284:
(1) Written resolution = every member has 1 vote re each share
(2) Show of hands = each member present has 1 vote
(3) Poll vote = every member has 1 vote re each share
Clear days’ notice
S360(2) Day of the meeting and day the notice is given are excluded
S1147(2) Default rule → if the notice is posted/sent, it is deemed to be served 48 hours after posting
2
, Procedure Plans
ORDINARY RESOLUTIONS
LT service contracts S188(2)
Authority to allot shares S551(1)
Ratification of D actions S239(2)
Substantial Property Transaction S190(1)
+ OR from members of holding co S190(2)
Affirmation of SPT S196(a)
+ OR from members of holding co S196(b)
Make a loan or To D of co or D of its holding co S197(1)
Guarantee/security of loan
Make a quasi-loan or G/S of quasi-loan To D of co or D of its holding co S198(2)
Make a loan or quasi-loan or G/S for L/Q-L Person connected with D of co/holding co S200(2)
Make a credit-transaction or G/S of CT To D of co or D of its holding co; or S201(2)
“ Person connected to D of co/holding co S201(3)
Affirmation of s197-201 S214
Removal of Ds S168(1)
Compensation for loss of office S217
Declaration of final dividend payment MA 30(1)
Purchase of own shares – Approve payment out of profits/FI S694(2)
Purchase of own shares – Approve payment out of capital S716(1)
Purchase of own shares out of capital – Approve contract terms S694(2)
SPECIAL RESOLUTIONS
Changing co name S77(1)(a)
Changing articles S21(1)
Direct Ds to take/refrain from specific action MA 4(1)
Disapplication of pre-emption rights S569; S570(1); S571
Creating new class rights (via amending articles) S21(1)
Disapply MA 14 re interested D S21(1)
Redemption – Approve payment out of capital S716(1)
Commencing Members’ or Creditors’ Voluntary Liquidation S84(1)(b)
3
intended to be used as a supplemental tool to aid revision in conjunction with BPP materials, not as a replacement for them.
Exam technique
Why are the resolutions needed?
Tailor to client: Provides names of Ds/SH who need to attend/vote
What is the likelihood of the resolutions being passed?
Adapt plan if articles contain special provisions
Advise client on any timing issues
RESOLUTIONS LIST
Board resolution Ordinary resolution Special resolution
Passed by Directors Shareholders
What meeting Board meeting General meeting
What for Day-to-day decisions that Decisions that CA or Articles Decisions that CA or Articles
don’t require OR/SR: MA3 say require OR say require SR
OR to call GMs where
OR/SR is needed
Notice Called by any director giving S307(1) Private = GM called by notice of 14 clear
reasonable notice ie days
whatever notice is usually S307(2) Public = AGM called by notice of 21 clear
for the directors to give: days, normal GM 14 clear days
Browne v La Trinidad; s307(3) Articles may require longer period though
MA9(1) S307(4-6) GMs may be called by shorter notice if
agreed by majority of members
S310(1) Every SH and D entitled to receive notice of
GM
S311(1) GM notice must contain time/date of
meeting and the place
S311(2) Notice must state the general nature of the
business to be dealt with at the meeting
Quorum MA 11(2): may be fixed 2: s318(2) CA
from time to time by Unless only 1 member, in which case 1 is sufficient: s318(1)
directors’ decision, but
never less than 2 and
otherwise fixed at 2
Voting Simple majority (>50%): Simple majority – OVER 75% OR MORE: s283(1)
threshold MA7(1); or 50%: s282(1) (75% on the dot IS okay)
Unanimity if written (50% on the dot is not okay)
resolution: MA7(1) and
MA8
,Procedure Plans
If deadlock → Chairman
has casting vote (check if
Articles have removed this):
MA 13(1)
If 1 director abstains, he
does not count towards the
number of people voting
How counted 1 vote per director Decisions made on a show of hands: s282(3)
→ 1 vote per member: s284(2)(a)
Poll: 1 vote per share: s284(3)
BUT can change this ^ in articles: s284(4)
Show of hands used as method unless a poll vote is
demanded: MA 42
Poll vote can be demanded before/at meeting
before/immediately after show of hands: MA 44(1)
Chairman, director, 2 or more shareholders or any member
with not less than 10% voting rights can demand a poll vote:
MA 44(2)
S281(3) Where a provision of the act requires a co/members resolution and does not specify what
type, it will be an OR unless the articles require a higher majority
S284:
(1) Written resolution = every member has 1 vote re each share
(2) Show of hands = each member present has 1 vote
(3) Poll vote = every member has 1 vote re each share
Clear days’ notice
S360(2) Day of the meeting and day the notice is given are excluded
S1147(2) Default rule → if the notice is posted/sent, it is deemed to be served 48 hours after posting
2
, Procedure Plans
ORDINARY RESOLUTIONS
LT service contracts S188(2)
Authority to allot shares S551(1)
Ratification of D actions S239(2)
Substantial Property Transaction S190(1)
+ OR from members of holding co S190(2)
Affirmation of SPT S196(a)
+ OR from members of holding co S196(b)
Make a loan or To D of co or D of its holding co S197(1)
Guarantee/security of loan
Make a quasi-loan or G/S of quasi-loan To D of co or D of its holding co S198(2)
Make a loan or quasi-loan or G/S for L/Q-L Person connected with D of co/holding co S200(2)
Make a credit-transaction or G/S of CT To D of co or D of its holding co; or S201(2)
“ Person connected to D of co/holding co S201(3)
Affirmation of s197-201 S214
Removal of Ds S168(1)
Compensation for loss of office S217
Declaration of final dividend payment MA 30(1)
Purchase of own shares – Approve payment out of profits/FI S694(2)
Purchase of own shares – Approve payment out of capital S716(1)
Purchase of own shares out of capital – Approve contract terms S694(2)
SPECIAL RESOLUTIONS
Changing co name S77(1)(a)
Changing articles S21(1)
Direct Ds to take/refrain from specific action MA 4(1)
Disapplication of pre-emption rights S569; S570(1); S571
Creating new class rights (via amending articles) S21(1)
Disapply MA 14 re interested D S21(1)
Redemption – Approve payment out of capital S716(1)
Commencing Members’ or Creditors’ Voluntary Liquidation S84(1)(b)
3
