COMPANY PROCEDURE PLANNING TEMPLATE – WS3 HAS ALL DECISIONS.
CALLING AND NOTICE
- MA9 - Any director can call a board meeting and must give notice to all directors.
- Notice must be reasonable – in a small company this could amount to a few hours
(Re Homer).
- Must be given to each director before meeting takes place, wherever he is in the
world MA 9 (1) and (3).
- Notice does not need to be in writing, may be oral – MA 9 (3), La Trinidad.
- Notice must give date, time, place, method of communication – MA 9 (2).
DECLARATIONS
- Is there a duty to declare the interest under s.177 (proposed transaction) and s.182
(existing transaction)?
- Has the declaration been properly made?
- If a D has an interest in the transaction, the D cannot form part of the quorum or
vote – MA14(1).
- MA14 (3) & (4) set out exceptions for above;
- MA14(3) – where the mater cannot reasonably be regarded as likely to give rise to
conflict of interest;
- MA14(4)(a) – where the interest is a guarantee given to or by a D for an obligation of
the company;
- MA14(4)(b) – where the interest is a contract with D and C to buy shares in the
company.
- Could temporarily disapply MA14(1) using MA14(3) to allow a D to form part of the
quorum – SH OR required to disapply.
- Where a chairman cannot vote because of his interest, he cannot use his casting
vote.
QUORUM
- Meeting has to be quorate in order for proposals to be voted on. The only decisions
that can be taken is to call another meeting or appoint more Ds MA11(1).
- TWO is quorate unless fixed otherwise. MA11(2).
- Ds can still attend BMs even if they can’t vote – Hayes v Bristol Plant Hire.
- Alternates are not mentioned in MA.
RESOLUTIONS
- List the resolutions and state in relation to each: WHO can vote and WILL IT PASS?
- Is a GM or WR of SHs needed? If so, resolve to call one.
- Example;
The board will resolve to;
- Approve the draft loan agreement;
- Approve the draft purchase agreement for the warehouse; and
- Call a General Meeting
, On the facts given, all Ds will vote in favour, so a simple majority will be achieved (MA7)
and the resolutions will be passed.
Note the requirement for a memorandum detailing the terms of the loan to be draws up
and kept at the C’s registered office for 15 days before the GM and at the GM itself
(s.197(3)).
VOTING
- MA7 – Only Ds present at the meeting can vote, but their votes can be
communicated in various ways – MA10.
- Voting proceeds on a simple majority basis – ie, if there is a deadlock the negative
view prevails – MA7(1).
- Deadlock – chair can use casting vote – MA13(1) – unless he is excluded from the
quorum –MA13(2).
- A Chairman may be appointed under MA12(1) – but not mandatory.
ADMINISTRATION
- MA15 - Ds must ensure that the company keeps a record of the decision recorded of
every unanimous or majority decision taken by the Ds, in writing for at least 10
years.
- Minutes must be recorded for every BM and kept at Cs registered office or SAIL for
10 years, otherwise an offence in committed by every officer of the C in default –
s.248 CA 2006.
CALLING AND NOTICE
- MA9 - Any director can call a board meeting and must give notice to all directors.
- Notice must be reasonable – in a small company this could amount to a few hours
(Re Homer).
- Must be given to each director before meeting takes place, wherever he is in the
world MA 9 (1) and (3).
- Notice does not need to be in writing, may be oral – MA 9 (3), La Trinidad.
- Notice must give date, time, place, method of communication – MA 9 (2).
DECLARATIONS
- Is there a duty to declare the interest under s.177 (proposed transaction) and s.182
(existing transaction)?
- Has the declaration been properly made?
- If a D has an interest in the transaction, the D cannot form part of the quorum or
vote – MA14(1).
- MA14 (3) & (4) set out exceptions for above;
- MA14(3) – where the mater cannot reasonably be regarded as likely to give rise to
conflict of interest;
- MA14(4)(a) – where the interest is a guarantee given to or by a D for an obligation of
the company;
- MA14(4)(b) – where the interest is a contract with D and C to buy shares in the
company.
- Could temporarily disapply MA14(1) using MA14(3) to allow a D to form part of the
quorum – SH OR required to disapply.
- Where a chairman cannot vote because of his interest, he cannot use his casting
vote.
QUORUM
- Meeting has to be quorate in order for proposals to be voted on. The only decisions
that can be taken is to call another meeting or appoint more Ds MA11(1).
- TWO is quorate unless fixed otherwise. MA11(2).
- Ds can still attend BMs even if they can’t vote – Hayes v Bristol Plant Hire.
- Alternates are not mentioned in MA.
RESOLUTIONS
- List the resolutions and state in relation to each: WHO can vote and WILL IT PASS?
- Is a GM or WR of SHs needed? If so, resolve to call one.
- Example;
The board will resolve to;
- Approve the draft loan agreement;
- Approve the draft purchase agreement for the warehouse; and
- Call a General Meeting
, On the facts given, all Ds will vote in favour, so a simple majority will be achieved (MA7)
and the resolutions will be passed.
Note the requirement for a memorandum detailing the terms of the loan to be draws up
and kept at the C’s registered office for 15 days before the GM and at the GM itself
(s.197(3)).
VOTING
- MA7 – Only Ds present at the meeting can vote, but their votes can be
communicated in various ways – MA10.
- Voting proceeds on a simple majority basis – ie, if there is a deadlock the negative
view prevails – MA7(1).
- Deadlock – chair can use casting vote – MA13(1) – unless he is excluded from the
quorum –MA13(2).
- A Chairman may be appointed under MA12(1) – but not mandatory.
ADMINISTRATION
- MA15 - Ds must ensure that the company keeps a record of the decision recorded of
every unanimous or majority decision taken by the Ds, in writing for at least 10
years.
- Minutes must be recorded for every BM and kept at Cs registered office or SAIL for
10 years, otherwise an offence in committed by every officer of the C in default –
s.248 CA 2006.
