Ch 14 Constitution of Company Flashcards
What is constitution of a company?
A company’s constitution comprises of articles of association and any resolutions and agreements it makes which affects the constitution
What is resolution?
Resolutions are legal decisions of members which directly affect the company’s constitution
What is a memorendum?
When a resolution or agreement is not in writing, the company is required to send a written record to registrar which is called a memorendum
How an article is amended?
With a special resolution(and should be for the benefit of the company as a whole)
How certain articles in a constitutions can be made unalterable?
1) By giving members additional votes
2) Setting a quorum
3) Entrench provisions (means specific provisions may only be altered when specific conditions are met)
Does Companies Act override company’s articles?
Yes
How a company can restrict its activities?
By including those restrictions in the articles
What is ultra vires?
When a company exceeds its objects and acts outside its capacity
The articles constitutes a contract between which two parties?
Company and members
What are the statutory rules on company name?
1) The names must end with Plc(if it is a public limited company) or Ltd(if it is a private company)
2) May not have a name which is the same as any other company
3) May not use a name which would be a crimial offence
what are the conditions under which a private company can omit the word ‘limited’ from its name?
1) Object of the company must be the promotion of particular activities (e.g art,commerce,science)
2) Any income or profit will be reinvested in promotion of its objects
3) On liquidation assets will be transferred to a body with similar objects
Is the consent of the registrar required for changing company name?
No,but after changing the name registrar should be notified
From when the change in company name be effective?
When a new incorporation certificate is issued
When can a person apply for an injunction to restrain a company from using its name?
If the name suggests that the later company is carrying on the same business of the complainant
When will court refuse to grant an injunction to restrain a company from using a name similar to that of other?
When the two companies’ businesses are different
