308 Chapter 11Companies (2): Management, control and winding up
Resolutions at company meetings
It is envisaged by the 2006 Act that private companies will generally pass resolutions as
written resolutions. However, private companies may choose to hold company meetings
to vote on resolutions. Public companies cannot pass written resolutions. They can pass
resolutions only at company meetings.
Generally, the directors propose resolutions to be moved at company meetings. However,
s. 338 allows the members of a publiccompany to propose a resolution to be moved at the
AGMand to require the directors to give notice of the resolution to all company members.
The directors must do this either if members holding at least 5 per cent of the total voting
rights request it, or if at least 100 members holding voting shares, which have an average
sum paid up of £100 each, request it. The expenses of complying with this are paid for by
the company, as long as the members requested the circulation of the resolution before the
end of the company’s previous financial year.
We have already seen that s. 303 gives members of any type of company, if they hold at
least 10 per cent of the voting shares, the power to require the directors to hold a general
meeting. We also saw that when requesting this meeting the members can include the text
of a resolution to be proposed and voted upon at the meeting.
Section 314 provides that the members of any type of companymay require the company
to circulate a statement of not more than 1,000 words with respect to a matter referred to
in a proposed resolution to be dealt with at a company meeting, or with respect to other
business to be dealt with at a company meeting. This statement must be circulated to all
members entitled to receive notice of the meeting. The company is required to circulate a
statement either if members holding at least 5 per cent of the total voting rights request it,
or if at least 100 members holding voting shares, which have an average sum paid up of
£100 each, request it. The request may be in hard copy or in electronic form and must be
received by the company at least one week before the meeting to which it relates.
Section 316 provides that the expenses of the company in complying with s. 315 do
not need to be paid for by the members who requested the circulation if the meeting in
question is the AGM of a public company and the request is given to the company before
the end of the company’s previous financial year. Otherwise, the expenses must be paid
by the members who made the request, unless the company passes a resolution excusing
them.Written resolutions
Written resolutions may be passed only by private companies. Both ordinary and special
resolutions can be passed as written resolutions. However, as we have seen, a written resolu-
tion cannot be used to remove a director under s. 168 of the 2006 Act. On a written resolution,
each share carries one vote and members cast their votes by signing the resolution. A written
ordinary resolution is passed if it is signed by members representing over 50 per cent of the
shares entitled to vote. A special resolution is passed if it is signed by members represent-
ing 75 per cent of the shares entitled to vote.
Written resolutions are generally proposed by the directors. When the directors propose
a resolution as a written resolution, s. 291(2) requires the company to send a copy of the
resolution to every eligible member. A single copy, or several copies, of the resolution might
be sent around for the members to sign. Alternatively, copies can be sent electronically or
by means of a Web site. So an email could be sent from member to member.
Section 292(1) allows the members of a private company who hold at least 5 per cent
of the voting shares to require the company to circulate a written resolution, along with