Podcast
Questions and Answers
Under which condition can the Duomatic Principle be applied?
Under which condition can the Duomatic Principle be applied?
What is true about the requirements for members' consent under the Duomatic Principle?
What is true about the requirements for members' consent under the Duomatic Principle?
What are directors responsible for in managing a company's business?
What are directors responsible for in managing a company's business?
Which situation makes the application of the Duomatic Principle invalid?
Which situation makes the application of the Duomatic Principle invalid?
Signup and view all the answers
What is the effect of unanimous assent under the Duomatic Principle?
What is the effect of unanimous assent under the Duomatic Principle?
Signup and view all the answers
In what scenario does the Duomatic Principle become stricter than a written resolution?
In what scenario does the Duomatic Principle become stricter than a written resolution?
Signup and view all the answers
How does the Duomatic Principle apply if a shareholder has passed away but is still registered?
How does the Duomatic Principle apply if a shareholder has passed away but is still registered?
Signup and view all the answers
What limitation exists regarding the agreement of shareholders under the Duomatic Principle?
What limitation exists regarding the agreement of shareholders under the Duomatic Principle?
Signup and view all the answers
What is a key distinction between the directors' powers according to MA 3 and the special resolutions in MA 4?
What is a key distinction between the directors' powers according to MA 3 and the special resolutions in MA 4?
Signup and view all the answers
What is the minimum percentage of shareholders required to pass an ordinary resolution in a company with five shareholders owning 20 shares each?
What is the minimum percentage of shareholders required to pass an ordinary resolution in a company with five shareholders owning 20 shares each?
Signup and view all the answers
Which type of resolution requires at least 75% of votes to pass?
Which type of resolution requires at least 75% of votes to pass?
Signup and view all the answers
What is the required notice period for an annual general meeting as stated in the Companies Act?
What is the required notice period for an annual general meeting as stated in the Companies Act?
Signup and view all the answers
In a company with only two shareholders, how many must agree to pass an ordinary resolution?
In a company with only two shareholders, how many must agree to pass an ordinary resolution?
Signup and view all the answers
If the model articles specify that the quorum for directors' meetings must be at least two, what is the minimum attendance needed?
If the model articles specify that the quorum for directors' meetings must be at least two, what is the minimum attendance needed?
Signup and view all the answers
Which of the following statements about the powers of the board of directors is incorrect?
Which of the following statements about the powers of the board of directors is incorrect?
Signup and view all the answers
What happens if the articles do not specify a quorum for general meetings?
What happens if the articles do not specify a quorum for general meetings?
Signup and view all the answers
When can shareholders requisition a general meeting?
When can shareholders requisition a general meeting?
Signup and view all the answers
What is the minimum length of notice required for meetings other than annual general meetings?
What is the minimum length of notice required for meetings other than annual general meetings?
Signup and view all the answers
The Duomatic Principle can be applied if one of the registered members does not agree.
The Duomatic Principle can be applied if one of the registered members does not agree.
Signup and view all the answers
Unanimous assent under the Duomatic Principle can be given simultaneously or at different times.
Unanimous assent under the Duomatic Principle can be given simultaneously or at different times.
Signup and view all the answers
The consent of members under the Duomatic Principle must be ambiguous and subjective.
The consent of members under the Duomatic Principle must be ambiguous and subjective.
Signup and view all the answers
The Duomatic Principle is more lenient than a written resolution.
The Duomatic Principle is more lenient than a written resolution.
Signup and view all the answers
If a registered shareholder has passed away but remains on the register, they may still count towards the unanimous assent requirement.
If a registered shareholder has passed away but remains on the register, they may still count towards the unanimous assent requirement.
Signup and view all the answers
Directors can make decisions on the day-to-day activities of the company without adhering to any limitations set by the articles.
Directors can make decisions on the day-to-day activities of the company without adhering to any limitations set by the articles.
Signup and view all the answers
Shareholders may direct directors to take specified actions through a special resolution under MA 4.
Shareholders may direct directors to take specified actions through a special resolution under MA 4.
Signup and view all the answers
The Duomatic Principle applies only to shareholders' resolutions and does not concern board resolutions.
The Duomatic Principle applies only to shareholders' resolutions and does not concern board resolutions.
Signup and view all the answers
All members must provide consent that is subjective and based on personal beliefs under the Duomatic Principle.
All members must provide consent that is subjective and based on personal beliefs under the Duomatic Principle.
Signup and view all the answers
Decisions made at general meetings can be perceived as effective even if formal resolutions have not been registered.
Decisions made at general meetings can be perceived as effective even if formal resolutions have not been registered.
Signup and view all the answers
A special resolution requires at least 75% of shareholders' votes to pass.
A special resolution requires at least 75% of shareholders' votes to pass.
Signup and view all the answers
A company with two members holding equal shares can pass an ordinary resolution with only one member's agreement.
A company with two members holding equal shares can pass an ordinary resolution with only one member's agreement.
Signup and view all the answers
The minimum quorum for a general meeting is always set at three shareholders.
The minimum quorum for a general meeting is always set at three shareholders.
Signup and view all the answers
Directors can make changes to company model articles without shareholder approval.
Directors can make changes to company model articles without shareholder approval.
Signup and view all the answers
A company must keep minutes of all proceedings from board meetings.
A company must keep minutes of all proceedings from board meetings.
Signup and view all the answers
A board meeting can be requisitioned by shareholders holding at least 10% of voting rights.
A board meeting can be requisitioned by shareholders holding at least 10% of voting rights.
Signup and view all the answers
The notice period for an annual general meeting can be less than 21 days if specified in the articles.
The notice period for an annual general meeting can be less than 21 days if specified in the articles.
Signup and view all the answers
An ordinary resolution requires an absolute majority of 50% of the votes to pass.
An ordinary resolution requires an absolute majority of 50% of the votes to pass.
Signup and view all the answers
The chairperson of a meeting is responsible for deciding points of order.
The chairperson of a meeting is responsible for deciding points of order.
Signup and view all the answers
Under company law, a special notice of 28 days is required for removing a director by ordinary resolution.
Under company law, a special notice of 28 days is required for removing a director by ordinary resolution.
Signup and view all the answers
Study Notes
Decision Making in Companies
- Formal Decision Making: Involves meetings like board meetings and general shareholder meetings.
-
Informal Decision Making (Duomatic Principle): Unanimous assent of all members entitled to vote is sufficient for a decision. This doesn't require a formal meeting or resolution.
- Does not need formal resolution if all members assent.
- Assent can be simultaneous or at different times.
- Effective for ordinary and special resolutions.
- Applicable to shareholder and board resolutions.
- Limitations of the Duomatic Principle: Applicable only if all registered members agree; consent must be real, fully formed, and objectively determinable; if a member holds shares for others, consent applies only to their own shares. More strict than written resolutions.
Transacting Company Business: Meetings and Resolutions
- Day-to-day company activities: Managed by directors but subject to company articles and shareholder directions.
- Shareholder Powers (MA 4): Shareholders can direct directors through special resolution, but cannot undo pre-resolution actions.
- Interaction of Board and Shareholders: General meetings for shareholders and board meetings for directors.
- Determining Roles: The Companies Act 2006 outlines roles and responsibilities, and articles can alter these positions.
Types of Resolutions
-
Shareholder Resolutions:
- Ordinary Resolution (OR): Requires more than 50% of shareholders to pass.
- Special Resolution (SR): Requires at least 75% of shareholders to pass.
Board Resolutions
- Board's Authority: The company's decisions are usually taken by the board, guided by company law.
- Majority Decisions (Model Articles): Model articles often allow decisions by simple majority (more than 50%).
Company Articles and Alterations
-
Customizing Model Articles: Companies can customize the Model Articles to better suit their needs through special resolutions, changing provisions like quorum requirements.
- Example of changes: Quorum for directors meetings, exceptions to director powers.
Removing Directors and Changing Company Names
- Removing Directors: Can be achieved by ordinary resolution through proper notice.
- Changing Company Name: Requires special resolution or as outlined in the articles (companies may choose to alter articles).
Running Meetings
- Calling Meetings: General meetings usually called by the board or a shareholder requisition.
- Notice Requirements: Articles typically outline the notice time required. Companies Act sets default times but these may be altered by special resolution.
- Quorum: Minimum number of members present enabling business transaction. Different requirements for various meetings, determined by the articles or Companies Act.
- Chair Duties: The chair preserves order, calls members, decides on points, and oversees voting.
- Minutes: Crucial record of meeting proceedings.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Explore the intricacies of decision making within corporate structures, focusing on both formal and informal methods. Learn about the Duomatic Principle and its limitations in shareholder resolutions. This quiz is essential for understanding corporate governance and decision processes.
