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LPC Law Notes Business Law and Practice Notes

Company Decision Making Notes

Updated Company Decision Making Notes

Business Law and Practice Notes

Business Law and Practice

Approximately 649 pages

A collection of the best LPC BLP notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".

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Company Decision Making

Board Meetings

Board meeting are called by directors giving reasonable notice (Brown v La Trinidad). MA 11(2) states that the quorum for a board meeting may be fixed from time to time but must never be less than 2.

Decisions are made at board resolution by simple majority (MA 7(1)) or unanimity (MA 8). The chairman may have a casting vote in deadlock situations (MA 13(1)). A director can abstain and their vote does not count as part of the voting number.

General Meetings

Shareholders own the company whilst the directors run it on a day to day basis. Therefore, shareholders often make decisions which effect the whole or function of the company.

The quorum for a shareholder meeting is 2 (s.318(2)) unless there is only one shareholder (s.318(1)).

Notice

A general meeting can be called on normal notice which requires 14 clear days notice to call a general meeting (s.307(1)) in which the β€˜clear day rule’ applies (s.360(1)).

Alternatively, short notice can be used under (s.307(4)-(6)) if the shareholders agree, and those shareholders make up 90% of the voting share.

Notice will be sent out by the company secretary and will be deemed to have been received 48 hours after it was sent by post or electronic means (s.1147(2)-(3)). The notice must also contain information stating the shareholder can appoint a proxy to act on their behalf.

Voting

Decisions are made by a show of hands unless a poll is demanded by two or more persons having the right to vote, or a person having 10% of the voting rights (MA 42). A poll vote can be demanded before the meeting, at the meeting or immediately after a vote on a show of hands (MA 44(1)).

On a show of hands each director has 1 vote, on a poll they have a number of votes in proportion to their shareholding.

Shareholders can either pass ordinary resolutions which require more than 50% of the votes (s.282(1)) or special resolutions which require no less than 75% of the votes to pass (s.283(1)). A special resolution will only be required where the Act specifically states (s.281(3)).

Written Resolutions

Shareholders can also pass written resolutions (s.288) which can save a lot of time. An ordinary resolution and special resolution can be passed in this way (s.282(2) & s.283(2)).

The company must send a copy of the...

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