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Corporate Constitute (MoA & AoA), documents 2, documents 3, book,…
Corporate Constitute (MoA & AoA)
MoA (Memorandum of Association)
Member's Rights to Own a Copy of MoA
once you have paid a sum (≤RM5) to obtain the copy of MoA, you will have establishment/registration with the MoA.
a copy of MoA must be issued by the company after the date of alteration.
members are always allowed & encouraged to have a copy of MoA.
Alteration of MoA
items that can be altered in the MoA. if any alterations is made, must lodge a report to the RoC.
convertion from private ⇆ public
object clause
convertion from unlimited → limited
share capital
name of company
alteration done by high court under section 181
Lodging MoA
compulsory to lodge to registrar when there are ammendments in MoA.
MoA lodged → registrar will issue certificate of incorporation → company will acquire legal status of body corporate.
section 16(1).
[Constuctive Notice] a person dealing with the company is deemed to have read the registered documents & considered to have understood them (eg. legal advertisement newspaper).
Construction of MoA
[General Rule] nothing in MoA should contradict with Companies Act unless provided by the act itself.
[Section 33(1)] a statutory contract bidning between company and its members qua members (members among themselves) & members inter se (members with 3rd parties).
Introduction
section 18(1) under Companies Act 1965.
compulsory to lodge by every types of company.
company limited by shares
company limited by guarantee.
unlimited company.
a basic constitution that presents/structure the company to the outside world.
Object Clause
[Lodgement of Special Resolution] a copy of sr altering the objects must be lodged to registrar after 21 days of passing of the sr.
*Special Resolution = already made known tthe intention to ammend something to the object clause
Effects of Alteration
takes effect upon the lodgement of sr.
does not take effect upon the passing of sr.
the altered object should only be implemented by the company on/after the effective date.
[Legality of Object] object listed in the MoA under the law must have justification & reasons.
[Unlawful Object Clause]
defeat any law
fraudulent
forbidden by any law
immoral
opposed to public policy
[Introduction] legal personality of a company for purposes stated in MoA (ex. types of activities & businesses). company can only carry out activites within its capacity & not prohibited by the law.
Doctrine of Ultra Vires
Introduction
meaning beyond the power or lacking the power given to the company under the law.
Examples of Ultra Vires
acts which are beyond capacity
acts carried out to abuse power of the company by agents
acts in violation/in excess of the AoA
[Related Case] Ashbury Railway Carriage & Iron Company v Riche
Effects of Ultra Vires
[English Law] any transaction made outside object clause is void.
[Malaysia Law] section 20(1): any transaction made outside object clause is valid as long as parties to the contract are concerned.
[section 20(2)(b)] company/company's member can take action against company officers of company who authorised ultra vires act.
[section 20(3)] members can claim damages // for petition to wind up.
[section 20(2)(a)] company's members have rights to take action against company to restrain performance of ultra vires act.
AoA (Articles of Association)
Content of AoA
Elements
Preliminary Contracts
Classes of Shares
Table A
[Related Case] Solaiappan & ors v Lim Yoke Fans & ors
Effects of Table A
if provision in Table A not excluding, it will form part of registered AoA.
alteration of AoA is done under section 31(1).
if elect did not register AoA, Table A will be the AoA.
[Introduction] if the company has no AoA, Table A acts as a model article.
Lien on Shares
Office Location
Calls on Shares
Transfer of Shares
Transmission of Shares
Alterations of Shares
Reduction of Shares
General Meeting
Directors
Accountants & Auditors
Dividends
Notices
Winding Up
Important Elements
[1st Secretary] must be named in both MoA & AoA // Section11(8): amendment is necessary for MoA & AoA if secretary is omitted.
[Form of AoA] must print and divided into numbered paragraph.
[1st Director] must be named in both MoA & AoA.
Binding Effect of AoA
Statutory Contract
not defeasible & incapable of being rectified in court.
[Related Case #1] Hickman v Kent or Romruy Marsh Sheepbreeders' Association
Essential Effect
bind between company & member qua member
bind between members inter se
[Related Case #2] Wong Kim Fatt v Leong & Co Sdn Bhd & Anor]
Section 33(1)
when registered, it constitutes a statutory contract.
binds when signed & sealed by every members.
Cannot be Rectfied by Court
court has no jurisdication to rectify/correct/ammend.
[section 31] if there are alteration, according to statutory procedure of sr, must require large majority vote (2/3 votes).
Introduction
companies that requires to register AoA
company limited by guarantee
company limited by both shares and guarantee
unlimited company
Characteristics of AoA
must be lawful
cannot override/overrule any provisions in MoA
used for internal regulations
a public document & allow for inspection
related to the matters of internal administration.
Conflict Between MoA & AoA
[AoA] govern matters on internal affairs
[MoA] govern matters on external affairs.
