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Southern Foundries v Shirlaw

[1940] AC 701

Case summary last updated at 21/01/2020 16:35 by the Oxbridge Notes in-house law team.

Judgement for the case Southern Foundries v Shirlaw

C, a director, had a ten-year service contract with D, company. Power was inserted into articles allowing shareholders to appoint and dismiss directors at will. C was dismissed prior to end of 10-year period. Held:
 
·        Articles were validly altered.
·        Existence of prior contract does not affect validity of a change in articles.
·        However director still had claim for damages.
i.e. as obligations in contract were not changed by alteration in D’s articles. 

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