Company decision-making & resolutions (board, members, meetings, written resolutions)

BLP.04 — Company Decision-Making & Resolutions

Two organs decide things: the board (manages the company, Model Articles ("MA") art. 3) and the members (reserve powers via resolution). Know which decisions sit where.

Board decisions

• Taken at a board meeting by majority vote on a show of hands; chair has a casting vote (MA art. 13) and a director normally has one vote each.
• Quorum for board meetings: minimum 2, unless the articles fix otherwise (MA art. 11). A sole director company can act under MA art. 7 (the amended MA, in force 28 April 2024 under the Companies (Model Articles) (Amendment) Regulations 2024, clarify the single-director position).
• No statutory notice period — directors get reasonable notice; no agenda required.
• Directors must declare interests in proposed transactions (CA 2006 ss.177/182). An interested director is generally not counted in quorum and cannot vote (MA art. 14) unless the conflict is permitted.
• Board can also act by unanimous written agreement (MA art. 8).

Members' resolutions

• Ordinary resolution (OR): simple majority — over 50% (CA 2006 s.282). Default where the Act/articles are silent.
• Special resolution (SR): at least 75% (s.283). Required for e.g. amending the articles, change of name, reducing capital, disapplying pre-emption, winding up.

General meeting (GM) mechanics

• Notice: 14 clear days for a GM (s.307); shorter notice needs consent of 90% of the voting shares for a private company (the articles may specify a higher figure up to 95%) (s.307(5)-(6)). "Clear days" excludes the day of service and the day of the meeting.
• Quorum: 2 qualifying members (one if a single-member company) (s.318).
• Voting: show of hands = one vote per member; on a poll = one vote per share (s.284). A poll may be demanded by not fewer than 5 members with the right to vote, or members representing at least 10% of the total voting rights (s.321) — the Model Articles modify this (MA art. 44).

Written resolutions (private companies only — s.288)

• Replace GMs except removing a director (s.168) or removing an auditor — those need a meeting.
• Pass on the same thresholds: OR = >50% / SR = ≥75% of the total voting rights of eligible members (ss.282(2)/283(2)) — not just those who respond.
• 28-day lapse period if not passed (s.297).

Common traps

• Thresholds are >50% and ≥75% (75% itself passes an SR).
• Written-resolution majorities are of all eligible members, not of votes cast — silence counts against.
• s.168 removal of a director needs special notice (28 days) and an actual meeting — never a written resolution.
• Notice is 14 clear days (GM), not 21 — 21 days applies to a public-company AGM.
• Poll demand under the statute is 5 members or 10% of voting rights (s.321), not 5%.
• Director ≠ shareholder: board powers and members' powers are distinct.

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