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LPC Law Notes > Business Law and Practice Notes
A more recent version of these Compatibility Of Articles With Ca 2006 Provisions notes – written by Cambridge And Oxilp And College Of Law students – is available here.
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Compatibility of Articles with the CA 2006 provisions
Articles that would NOT be compatible with the CA 2006
Articles that MAY be compatible with the CA 2006
1) The articles can be amended by the directors
No
*
2) The requirement of unanimity (100%) from the shareholders to remove a director
No
*
3) Preventing the use of written resolutions by shareholders. All resolutions must be passed at shareholders' meetings
No
*
1) The quorum of shareholders' meeting should be fixed to the number of shareholders that the company has
Yes - A company with more than one member
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S.318(2) provides for a quorum of two 'subject to the articles'
S.21(1) CA 2006 requires a shareholders special resolution to amend the articles
S.168(1) CA 2006 states that directors can only be removed by ordinary resolution (50%+1) and does not permit qualification.
S.300 CA 2006 states that any articles preventing written resolutions is void.
No - A single-member company
*
S.318(1) sets the quorum at one without qualification so the act prevails
Articles that ARE be compatible with the CA 2006
1) Definitions and interpretations
Yes The CA 2006 is silent on this matter
2) The Quorum for directors' meeting to be fixed to the number of directors of the company
Yes
*
The CA 2006 is silent on the matter
3) Preventing the chairman of a board meeting having a casting vote if the votes are equal
Yes
*
The CA 2006 is silent on the matter
4) Incorporating the MA into the Precedent Articles
Yes This reflects s.20 CA 2006
5) Stating the company shall not have an objects clause
Yes
*
*
The effect of s.28(1) CA 2006 is to transfer the objects clause from the company's memorandum into its articles. Under s.21(1) CA 2006 you can amend a company's articles at any time
6) Preventing the board collectively spending more than PSX without express shareholder approval
Yes
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The CA 2006 is silent on the matter
7) Prevent an individual director spending more than PSX without board approval
Yes
*
The CA 2006 is silent on the matter
8) The directors can change the name of the company
Yes
*
*
This falls within the scope of s.77(1)(b) CA 2006 When acting upon this article the company must also comply with s.79 CA 2006
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