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Bushell v Faith

[1970] 1 All ER 53

Case summary last updated at 21/01/2020 21:33 by the Oxbridge Notes in-house law team.

Judgement for the case Bushell v Faith

Private company had 300 shares, divided equally between A, B and C. Company’s articles provided that where a vote was called on the removal of a  director, that director’s shares would have three votes per share (as opposed to the usual one). A and B proposed ordinary resolution to remove C, and claimed it passed 200 shares to 100; C claimed that by virtue of articles, his shares had three votes each when voting on resolution and therefore the resolution was defeated 300 votes to 200. Held:
 
Majority
·       Is nothing unobjectionable about special class rights attaching to shares only on specific occasions.
·        Thus it is possible for special class rights to make a director virtually irremovable.
·        IN any case, listed companies cannot circumvent s.168 through special rules such as these.
Ø  Thus ability to block removal of director via articles restricted to private companies

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