2.2 Companies: Company Constitution

Question 1

What is the legality test

Answer 1

Tailored AoA must be consisten w/ CA provisions

Question 2

Pro of capping delegation under MA 5

Answer 2

Cap may be significant for small business, to control spending

Question 3

154 CA on what

Answer 3

Ds for Priv + PubC

Question 4

Alternative to capping Ds power under MA 3, when D = M

Answer 4

Provision in SA to keep cap private

Question 5

CA section on docs for registration at CH

Answer 5

9

Question 6

271 says what

Answer 6

PubC needs to have CS

Question 7

Con of capping delegation

Answer 7

Removing if company grows requires amending AoA

Question 8

MA 17(1) on what

Answer 8

Methods of appointing Ds

Question 9

CA provision on amending AoA

Answer 9

21(1)

Question 10

Can method to change name be amended by AoA (+ section)

Answer 10

Yes per 77(1)(b)

Question 11

Section for Ms to approve an act in advance that would otherwise be BoD by D

Answer 11

180(4)

Question 12

Can BM power to delegate under MA 5 be restricted?

Answer 12

Yes

Question 13

Alternative to capping delegation under MA 5

Answer 13

Easier to use BR to impose cap, so only BR to remove, rather than BR + SR (21(1))

Question 14

Advantage for shelf company for time

Answer 14

If fits purpose, only need to amend e.g. officers and reg office

Question 15

When does cap on D’s powers under MA 3, requiring shareholder res, make no difference

Answer 15

When M = D

Question 16

CA provision that 3rds relying on board in GF have appauth

Answer 16

40

Question 17

Can BM power be restricted under MA 3

Answer 17

Yes - silent in CA

Question 18

Disadvantage of inc. from scratch for cost

Answer 18

Filing costs can be p to £100 + legal costs in creating AoA (if not using MA)

Question 19

Advantage of incorporation from scratch for time

Answer 19

E-filing is same day if before 4.30

Question 20

Pros of capping Ds power under MA 3, requiring Shareholder Res to go above cap (if 1M)

Answer 20

If there is 1M, gives them a second check, and easy to pass res

Question 21

Cons of capping Ds power under MA 3

Answer 21

Time-consuming if company grows. If all Ms = Ds, makes no difference.

Question 22

Pro of casting vote under MA 13

Answer 22

Avoids deadlock

Question 23

Advantage of inc. from scratch for formalities

Answer 23

Can use MA + just file s.9 docs

Question 24

Provision on appointing Ds

Answer 24

MA 17(1)

Question 25

Disadvantage of inc from scratch for tim

Answer 25

Other than e-filing takes longer, and bespoke AoAs are time-consuming

Question 26

What is the solution to practical issue of MA 14(1) when D has interest in transaction, and no quorum met without D

Answer 26

Either amend MA to include D, or Ms authorise under 14(3)(a)

Question 27

What provision disregards D w/ interest in a transaction from quorum + voting in proposed transaction

Answer 27

MA 14(1)

Question 28

What company and per what section needs to have CS

Answer 28

Pub per 271

Question 29

Who does job of CS in PrivC if no CS?

Answer 29

Ds (270(3)(b))

Question 30

250 CA on what

Answer 30

D duties apply equally to NEDs + EDs

Question 31

Section for Ms to ratify act that was BoD

Answer 31

239(2)

Question 32

s.300 CA on what?

Answer 32

Any provision in AoA removing WR is void

Question 33

What happens if M = D and there is a deadlock

Answer 33

Need SA deadlock provision

Question 34

CA provision prohibiting removing WR as res option

Answer 34

300

Question 35

Can BM quorum (MA 11(2)) be amended?

Answer 35

Yes - silence in CA, so can amend 11(2)

Question 36

Advantage of shelf company for cost

Answer 36

Cheap if few changes needed

Question 37

Disadvantage of shelf company for formalities

Answer 37

Changes may require AoA and/or notifying RoC

Question 38

Con of casting vote under MA 13

Answer 38

One D may end up controlling the company if only 2Ds

Question 39

What is the downside of provision in SA to cap Ds power under MA 3

Answer 39

Cumbersome to amend the SA

Question 40

Disadvantage of shelf company for cost

Answer 40

Legal costs for many amendments can be high

Question 41

CA provision demanding OR to remove Ds (no possibility to amend)

Answer 41

168(1)

Question 42

175(3) excludes what transactions from triggering 175

Answer 42

Transactions with the company

Question 43

Disadvantage of inc. from scratch for formalities

Answer 43

Have to reg and inc. at CH

Question 44

33(1) CA shows what

Answer 44

AoA is covenant between C + Ms

Question 45

Disadvantage for shelf company for time

Answer 45

Many changes are time-consuming; need to file w/ CH

Question 46

How many Ds must PrivC and PubC have

Answer 46

1 for Priv, 2 for Pub

Question 47

What would it be easier to do than alter articles to restrict delegation under MA 5

Answer 47

Pass BR to agree X spending cap, as altering articles requires SR (21(1))

Question 48

When must D disclose interest in a transaction under 177

Answer 48

Before the transaction

Question 49

Can AoA remove power to pass res by WR?

Answer 49

No

Question 50

s.168(1) on what?

Answer 50

Any provision in AoA which changes from OR to remove Ds is void

Question 51

Two ways to appoint Ds? which is most likely?

Answer 51

By OR or BR - by BR

Question 52

Can GM quorum be amended in AoA

Answer 52

Yes, if more than 1M, bc 318(2) is subject to AoA

Question 53

Can method to remove Ds under 168(1) be amended

Answer 53

No

Question 54

When does s.175 usually apply

Answer 54

When acting for competitors

Question 55

Can BM casting vote (MA 13) be amended?

Answer 55

Yes - silence in CA so can amend MA 13

Question 56

Alternative to removing casting vote under MA 13

Answer 56

Push quorum to X number to avoid deadlock. If there is deadlock, go to Ms. If M = D, SA deadlock provision

Question 57

How do you amend AoA (kind of res)

Answer 57

SR

Question 58

When is a cap on Ds powers under MA 3 likely?

Answer 58

If M does not = D

Question 59

Can method to amend AoA pr 21(1) be changed?

Answer 59

No

Question 60

What section requires OR for long-term service Cs of Ds

Answer 60

188

Question 61

Advantage of shelf company for formalities

Answer 61

Some changes can be done online

Question 62

Advantage of inc. from scratch for cost

Answer 62

E-filing can be £30

Question 63

Provision on casting vote for chairman

Answer 63

MA 13

Question 64

Can BM notice be changed in AoA?

Answer 64

Yes - Browne only applies in absence of AoA provision