Secretarial practice

Bibliographic data

Monograph

Identifikator:: 1828236004

URN:: urn:nbn:de:zbw-retromon-249926

Document type:: Monograph

Title:: Secretarial practice

Edition:: fourth edition

Place of publication:: Cambridge

Publisher:: W. Heffer & Sons Ltd

Year of publication:: 1930

Scope:: viii, 987 Seiten

Digitisation:: 2022

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter IV. Articles of association

Collection:: Economics Books

ARTICLES OF ASSOCIATION Articles of association commonly contain many clauses which simply reproduce statute law. Such clauses are of course surplusage, although for the sake of completeness, it is desirable to insert them. For the Stock Exchange requirements as to articles of association, see Appendix D. It may be pointed out that the word ‘regulations,’ where it Nature of occurs in the articles of a company, may or may not be Articles. equivalent to ‘articles’ [Quin & Axtens v. Salmon (1909), A.C. 442]. In other words, a company may have ‘regulations’ other than its articles; these may be constituted by minutes of the board, or by resolutions carried in general meeting. {t must, however, be borne in mind that the articles -can only be altered by special resolution and a resolution of the board, or an ordinary or extraordinary resolution of the company in general meeting, if inconsistent with the articles, would be ineffective. The articles form a code of regulations for the internal management of the company, whilst the memorandum is the charter of the company and defines its powers. The respective functions of the two documents are clearly described in the extract from the judgment of Lord Cairns, in Ashbury Railway Carriage Company Vv. Riche (1875, L.R. 7 H.L. 653), cited in Chapter III. The provisions of the articles cannot, therefore, extend the powers of the company. It is useless, for example, for an article defining the powers of directors to clothe them with a power which the company itself does not possess. Thus, to take a simple instance, if a company, which, not being a trading company, has no implied power to borrow money, has not in its memorandum taken a power to borrow, it is clear that an article giving the directors power to borrow will be wholly inoperative. Again, if the memorandum of a company defines the rights attaching to different classes of shares, and itself contains no provisions for the alteration of those rights, whether by reference to the articles of associa- tion or otherwise, it is useless for the articles to provide that those rights can be altered by special resolution, or by any specified majority of the shareholders. Neither can the articles deprive members of rights given to them by statute, and therefore a provision in the articles that, in case of a reconstruction, dissenting shareholders shall not have the rights given them by s. 234 is invalid [Payne v. Cork Co. (1900), 1 Ch. 308]. Similarly, share- holders having in certain circumstances a statutory right to present a winding-up petition, an article purporting to

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