2.2 Companies: Company Constitution Flashcards
What is the legality test
Tailored AoA must be consisten w/ CA provisions
Pro of capping delegation under MA 5
Cap may be significant for small business, to control spending
154 CA on what
Ds for Priv + PubC
Alternative to capping Ds power under MA 3, when D = M
Provision in SA to keep cap private
CA section on docs for registration at CH
9
271 says what
PubC needs to have CS
Con of capping delegation
Removing if company grows requires amending AoA
MA 17(1) on what
Methods of appointing Ds
CA provision on amending AoA
21(1)
Can method to change name be amended by AoA (+ section)
Yes per 77(1)(b)
Section for Ms to approve an act in advance that would otherwise be BoD by D
180(4)
Can BM power to delegate under MA 5 be restricted?
Yes
Alternative to capping delegation under MA 5
Easier to use BR to impose cap, so only BR to remove, rather than BR + SR (21(1))
Advantage for shelf company for time
If fits purpose, only need to amend e.g. officers and reg office
When does cap on D’s powers under MA 3, requiring shareholder res, make no difference
When M = D
CA provision that 3rds relying on board in GF have appauth
40
Can BM power be restricted under MA 3
Yes - silent in CA
Disadvantage of inc. from scratch for cost
Filing costs can be p to £100 + legal costs in creating AoA (if not using MA)
Advantage of incorporation from scratch for time
E-filing is same day if before 4.30
Pros of capping Ds power under MA 3, requiring Shareholder Res to go above cap (if 1M)
If there is 1M, gives them a second check, and easy to pass res
Cons of capping Ds power under MA 3
Time-consuming if company grows. If all Ms = Ds, makes no difference.
Pro of casting vote under MA 13
Avoids deadlock
Advantage of inc. from scratch for formalities
Can use MA + just file s.9 docs
Provision on appointing Ds
MA 17(1)
Disadvantage of inc from scratch for tim
Other than e-filing takes longer, and bespoke AoAs are time-consuming
What is the solution to practical issue of MA 14(1) when D has interest in transaction, and no quorum met without D
Either amend MA to include D, or Ms authorise under 14(3)(a)
What provision disregards D w/ interest in a transaction from quorum + voting in proposed transaction
MA 14(1)
What company and per what section needs to have CS
Pub per 271
Who does job of CS in PrivC if no CS?
Ds (270(3)(b))
250 CA on what
D duties apply equally to NEDs + EDs
Section for Ms to ratify act that was BoD
239(2)
s.300 CA on what?
Any provision in AoA removing WR is void
What happens if M = D and there is a deadlock
Need SA deadlock provision
CA provision prohibiting removing WR as res option
300
Can BM quorum (MA 11(2)) be amended?
Yes - silence in CA, so can amend 11(2)
Advantage of shelf company for cost
Cheap if few changes needed
Disadvantage of shelf company for formalities
Changes may require AoA and/or notifying RoC
Con of casting vote under MA 13
One D may end up controlling the company if only 2Ds
What is the downside of provision in SA to cap Ds power under MA 3
Cumbersome to amend the SA
Disadvantage of shelf company for cost
Legal costs for many amendments can be high
CA provision demanding OR to remove Ds (no possibility to amend)
168(1)
175(3) excludes what transactions from triggering 175
Transactions with the company
Disadvantage of inc. from scratch for formalities
Have to reg and inc. at CH
33(1) CA shows what
AoA is covenant between C + Ms
Disadvantage for shelf company for time
Many changes are time-consuming; need to file w/ CH
How many Ds must PrivC and PubC have
1 for Priv, 2 for Pub
What would it be easier to do than alter articles to restrict delegation under MA 5
Pass BR to agree X spending cap, as altering articles requires SR (21(1))
When must D disclose interest in a transaction under 177
Before the transaction
Can AoA remove power to pass res by WR?
No
s.168(1) on what?
Any provision in AoA which changes from OR to remove Ds is void
Two ways to appoint Ds? which is most likely?
By OR or BR - by BR
Can GM quorum be amended in AoA
Yes, if more than 1M, bc 318(2) is subject to AoA
Can method to remove Ds under 168(1) be amended
No
When does s.175 usually apply
When acting for competitors
Can BM casting vote (MA 13) be amended?
Yes - silence in CA so can amend MA 13
Alternative to removing casting vote under MA 13
Push quorum to X number to avoid deadlock. If there is deadlock, go to Ms. If M = D, SA deadlock provision
How do you amend AoA (kind of res)
SR
When is a cap on Ds powers under MA 3 likely?
If M does not = D
Can method to amend AoA pr 21(1) be changed?
No
What section requires OR for long-term service Cs of Ds
188
Advantage of shelf company for formalities
Some changes can be done online
Advantage of inc. from scratch for cost
E-filing can be £30
Provision on casting vote for chairman
MA 13
Can BM notice be changed in AoA?
Yes - Browne only applies in absence of AoA provision
