AGM and special resolutions

[bluevenetian]

I'm hoping someone will now the answer to this, because its doing my head in adn a company of which I am a director are holding an AGM on Tuesday at which we will debate a special resolution motion. The trouble is one shareholder has spent the last week bending my ear telling me that I and the other directors have misread Companies Act 2006.

The dissenting shareholder says 75 percent of ALL shareholders must vote to pass a special resolution. That is to say 75 percent of shareholders must say "yes".

My understanding is that 75 percent of shareholders who attend the meeting, or by proxy, must vote "yes"

Which is right?

 

[nick mercedes]

I'm hoping someone will now the answer to this, because its doing my head in adn a company of which I am a director are holding an AGM on Tuesday at which we will debate a special resolution motion. The trouble is one shareholder has spent the last week bending my ear telling me that I and the other directors have misread Companies Act 2006.

The dissenting shareholder says 75 percent of ALL shareholders must vote to pass a special resolution. That is to say 75 percent of shareholders must say "yes".

My understanding is that 75 percent of shareholders who attend the meeting, or by proxy, must vote "yes"

Which is right?

With something this important is not professional advice in order?

 

[bluevenetian]

Tell me about it - I have spoken with our lawyers, who tell me that a special resolution requires 75 percent of those voting/attending and that the minimum number of those who must attend an AGM to make it quorate, is in our case, 75 percent of all shareholders.

Unfortunately the dissenting shareholder has also contacted a letter and has forwarded that to me, which suggests that 75 percent of ALL shareholders must approve. However, the terminology of the letter is slightly ambigious to me at least, and could be read either of two ways. My way and the dissenting shareholders way.

Looks like I may have to consult a third lawyer, now where's my wallet???

 

[renault12ts]

75% of those present or by appointment of a proxy.

 

[flango]

From SWMBO the 1985 Companies Act states

A special resolution. This requires a 75% majority of votes cast at an EGM or
AGM, and 21 days’ notice must be given of both the meeting and the resolution to
be moved (therefore extending the EGM’s normal notice period of 14 days).
Special resolutions are required (by statute) for changes of company name,
changes in the Memorandum or Articles of Association, or reductions in or​

creation of share capital.

So Renault12TS is spot on 75% of those present or by proxy.

 

[timk]

From SWMBO the 1985 Companies Act states

A special resolution. This requires a 75% majority of votes cast at an EGM or
AGM, and 21 days’ notice must be given of both the meeting and the resolution to
be moved (therefore extending the EGM’s normal notice period of 14 days).
Special resolutions are required (by statute) for changes of company name,
changes in the Memorandum or Articles of Association, or reductions in or​

creation of share capital.

So Renault12TS is spot on 75% of those present or by proxy.

Companies Act 2006 has now repealed the CA 1985, but what has been posted thus far is correct - for a special resolution to be validly passed, 75% of votes cast (not 75% of shares in issue), either in person or by proxy, must be in favour of the resolution.

 

[flango]

Companies Act 2006 has now repealed the CA 1985, but what has been posted thus far is correct - for a special resolution to be validly passed, 75% of votes cast (not 75% of shares in issue), either in person or by proxy, must be in favour of the resolution.

Sorry you are correct we were talking about the provision of some rules in the 1985 act and then she did say the latest was 2006, my fault bit of a miss post on dates but the info is good.

 

[timk]

Tell me about it - I have spoken with our lawyers, who tell me that a special resolution requires 75 percent of those voting/attending and that the minimum number of those who must attend an AGM to make it quorate, is in our case, 75 percent of all shareholders.

Unfortunately the dissenting shareholder has also contacted a letter and has forwarded that to me, which suggests that 75 percent of ALL shareholders must approve. However, the terminology of the letter is slightly ambigious to me at least, and could be read either of two ways. My way and the dissenting shareholders way.

Looks like I may have to consult a third lawyer, now where's my wallet???

unusual for a quorum to be 75% of all shareholders. Most companies articles of association which govern how they are run, and the conduct of AGM's will specify minimum 2 shareholders as a quorum. But your company may have very specific articles - so your lawyers who must have read them, ought to be correct..

 

[bluevenetian]

It is a resident's association company with 47 apartments. The directors are trying to reduce the quorum to 50 percent rather than 75 percent because in 10 years we have only ONCE got 75 percent of residents to vote -- when I and my fellow directors were elected.
I only took it on two years ago because the whole place was going to rack and ruin and previous directors were suing and counter suing each other.
It has been the most fruitless unrewarding two years of my life