ARTICLE 80 OF TABLE A OF THE COMPANIES ACT 1948
| Published date | 01 March 1970 |
| DOI | http://doi.org/10.1111/j.1468-2230.1970.tb01264.x |
| Date | 01 March 1970 |
ARTICLE
80
OF
TABLE A
OF
THE
COMPANIES ACT
1948
IN
the second edition
of
his
book
on
The Principles
of
Modern
Company Law
“
the modern rule therefore is that under an article
in
the terms
[of Article
SO]
of
Table A ;the members in general meeting
cannot give directions on how the company’s affairs are
to
be
managed, nor can they overrule any decision come to by the
directors
in
the conduct of its business. And this applies even
as regards matters not specifically delegated
to
the
directors
provided they are not expressly reserved
to
a general meeting
by the Act
or
the articles
”;
Professor Gower says
:
and later he adds,2
“
Moreover, although the general meeting cannot restrain the
directors
from conducting actims in the name of the company,
it
still seems to
be
the law (as laid down
in
Marshall’s Valve
Gear
Co.
Ltd.
v.
Manning Wade
c!+
Co.
LW3)
that the general
meeting can commence proceedings
on
behalf of the company
if
the directors fail
to
do
so.
These exceptions are convenient
but difficult
to
reconcile in principle with the (strict theory of
a division
of
powers.’’
It
is the thesis of this note that this interpretation
of
Article
80
is wrong and that
Marshall’s
case, far from being anomalous, in fact
correctly states the general rule.
Hlaving regard
to
the common practice
of
the profession
and
the
unadvised public
to
adopt Table
A
with but minor modification for
the great majority of companies (especially those which are emall
and private)
it
would as a matter
of
principle be unfortunate if
Article
80
in truth involved a general abdication
on
the part of the
shareholders.
In
the case of the village grocer (beloved of Professor
Gower)
who incorporates his business and at the same time brings in
capital additional
to
hb
own,
it
is
probable that the shareholders will
appoint the promoter with one
or
two
others
as
directors.
The
shareholders will intend that
“
the business of the company shall be
manlaged by the directors
”
but they would be very surprised to
learn that a majority
of
votes could not overrule the board; ather-
wise they
could
with almost the same result have made a simple
1
London 1957, p. 123.
In
the
3rd edition
(London
Article
80
appeara
at
pages 130-133.
The
learned
changed,
but
are more briefly expressed.
2
Ibid.
at p.
1%‘.
3
“091
1
Ch. 267.
4
An
interpretation which
is
seen
also
in
Ruckley
m
5
Companies
Set
1948, Table
A,
Art.
80.
ed., London 1957) at
p.
860.
,
1969) the discussion
of
author’s views have
not
the
Companies
Act
(13th
177
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