Agreement between all 5 shareholders and company that share structure of company should not be altered unless certain procedures in agreement were complied with.
Resolution was proposed that was not compliant with agreement.
Claimant, a shareholder, sought declaration agreement was valid.
Is permissible for shareholders to agree amongst themselves to exercise voting rights in manner which would be unlawful if they were binding upon company.
However company cannot validly deprive itself of power to amend its articles.
Hence:
Agreement as between members and company is unenforceable
However it is severable from agreement as between shareholders.
Agreement still valid as between shareholders.
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Company law | The Constitution Of The Company Notes (20 pages) |