The companys general meeting has ratified the

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• The company’s general meeting has ratified the transaction by the appropriate resolution. Download free eBooks at bookboon.com
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BUSINESS ORGANISATIONS AND AGENCY COMPANY CONSTITUTION AND CONTRACTUAL CAPACITY 397 21.4.2.5 Members can prevent acts beyond directors’ powers Where a company has limited its directors’ powers in its articles, the members can bring a court action to prevent the directors from doing any act beyond those powers. However no action could be brought if the act was done in fulfilment of an existing obligation arising from a previous act of the company s. 40 (4). Thus, members of a company may stop their company directors from going against their articles before the transaction takes place. If the directors fail to abide by the members’ wishes, they could be liable to the company for any losses. 21.4.2.6 Companies’ capacity to make political donations remains limited A company has no power to make political donations or expenditure to any political party, independent candidate, or political organisation of more than £5000 in any one year without a resolution by the company – s. 366 CA 2006. If directors make unauthorised political donations or expenditure, they are personally liable to refund the money and to pay for any loses or damages suffered by the company as a result – s. 369. However , donations or expenditure to trade unions or trade associations, or All Party Parliamentary Groups are not to be regarded as political donations/expenditures – s. 37. Download free eBooks at bookboon.com Click on the ad to read more PDF components for PHP developers SETASIGN This e-book is made with SetaPDF
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BUSINESS ORGANISATIONS AND AGENCY 398 COMPANY CONSTITUTION AND CONTRACTUAL CAPACITY 21.5 CHAPTER SUMMARY • A company’s constitution comprises its articles of association and any special and unanimous resolutions. • Every company must have articles of association. It may make its own, or the appropriate model articles in the Companies Act would automatically apply to it. • Articles of association contain rules for the organisation and running of the affairs of a company, the regulation of the activities and rights of its members and officials, the election and removal of officers, and other things relevant to the business and functioning of the company. A company’s articles of association is a contractual document binding the company and its members and enforceable by them but only in respect of rights arising from membership. • The articles are not a contract between a company and its officials and outsiders who are not entitled to enforce any provisions in them. • The provisions of a company’s articles are alterable by the members by special resolution or by such means as may be stipulated therein. The power of members to alter the articles cannot, however, be removed by any provisions in the articles.
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  • Fall '19
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