Requisition EGM

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    Requisition EGM

    Hello,
    A Director of our Management Company has informed me that we need 20% of members to request an EGM for one to take place. I thought it was 10% as per the Companies Act, can anyone advise please.

    Thank you very much in advance.

    #2
    Never mind what the Director says. What do the Company's Articles of Association say?
    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
    4. *- Contact info: click on my name (blue-highlight link).

    Comment


      #3
      Originally posted by jeffrey View Post
      Never mind what the Director says. What do the Company's Articles of Association say?
      It says
      "The Council may whenever they think fit convene an Extraordinary General meeting and Extraordinary General Meetings shall also be convened on such requisition or in default may be convened by such requisitionists as provided by Section 368 of the Act."

      Does that mean 10% ?

      Thank you ever so much for all your help

      Comment


        #4
        That "s.368" is a reference to the Companies Act 1985. It's now s.303 of the Companies Act 2006, which reads:

        303. Members' power to require directors to call general meeting

        (1) The members of a company may require the directors to call a general meeting of the company.

        (2) The directors are required to call a general meeting once the company has received requests to do so from:
        (a) members representing at least 15% of such of the paid-up capital of the company as carries the right of voting at general meetings of the company (excluding any paid-up capital held as treasury shares); or
        (b) in the case of a company not having a share capital, members who represent at least 15% of the total voting rights of all the members having a right to vote at general meetings.

        (3)...

        (4) A request:
        (a) must state the general nature of the business to be dealt with at the meeting, and
        (b) may include the text of a resolution that may properly be moved and is intended to be moved at the meeting.

        (5) A resolution may properly be moved at a meeting unless:
        (a) it would, if passed, be ineffective (whether by reason of inconsistency with any enactment or the company's constitution or otherwise),
        (b) it is defamatory of any person, or
        (c) it is frivolous or vexatious.

        (6) A request:
        (a) may be in hard copy form or in electronic form, and
        (b) must be authenticated by the person or persons making it.
        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
        4. *- Contact info: click on my name (blue-highlight link).

        Comment


          #5
          Fabulous, thanks
          I'm confused about all these %, your post says 15%, I have seen 10% in the 1985 Act which I understand has been superceded and I have seen 5% here

          http://www.legislation.gov.uk/uksi/2...ulation/4/made

          The Articles also states "The Subscribers to the Memorandum of Association shall be entitled to 50 votes at all General Meetings for so long as they remain Members of the Company"
          Each dwelling holder as 1 vote, there are only 29 dwellings. Does the Act mean 15% of the dwelling holders, therefore 5.
          Or do the Subscribers/Director's 50 votes also count in effect making it impossible to call an EGM?

          Comment


            #6
            Are the subscribers still members of the company? If not then this is irrelevant.
            RICHARD WEBSTER

            As a conveyancing solicitor I believe the information given in the post to be useful (provided it relates to property in England & Wales) but I accept no liability except to fee-paying clients.

            Comment


              #7
              Originally posted by Richard Webster View Post
              Are the subscribers still members of the company? If not then this is irrelevant.
              I have no idea. I will find out though.
              Do you know whether I need 10%, 15% or 20% requests to force an EGM?

              Kind thanks

              Comment


                #8
                Originally posted by Emielou5 View Post
                I have no idea. I will find out though.
                Do you know whether I need 10%, 15% or 20% requests to force an EGM?

                Kind thanks
                You are focusing on what you can understand and for the moment it is irrelevant. Please forget %'s for now. It is frustrating but simply put "don't worry about the temperature of the oven, you have to make the cake first! "

                1- You need to establish what the issues are at the building and the solutions. Tie that into the performance of the directors seeking them to pursue these solutions, or to be removed and replaced or supplemented by directors that will. You will need local advice on the issues the solutions, the cost implications and recovery under the lease and drafting of the resolutions. You might be able to do this yourself, but arging they are problems, the solution is to throw money at it, and therefore you are mismanaging is doomed to failure. It is merely the the thrust of the argument.
                Post# 4 items 4 a & B is an excellent structure to work to. The more detailed and accurate the business is set out and resolutions are set out the more effective the meeting will be.

                2:Articles

                The subscribers have 50% of the vote and scuppers any vote. Are the subscribers named in the articles and are they still members.
                What is the issued share capital and who holds it. Ask the Company Secretary, if required exercise your right to inspect the register, or research online at Companies House looking at the last annual return.

                If they are still members what do the articles say about qualification as members, and are they therefore still members but not entitled to be. It is often the case that the developer is the first subscriber and ceases to be a member after the last unit is sold.

                Once you understand the membership and articles the temperature of the oven can be set!
                Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

                Comment


                  #9
                  I have this (5%)

                  303 Members' power to require directors to call general meeting [version in force from 3 August 2009]

                  303(1) The members of a company may require the directors to call a general meeting of the company.

                  303(2) The directors are required to call a general meeting once the company has received requests to do so from–

                  (a)members representing at least 5% of such of the paid-up capital of the company as carries the right of voting at general meetings of the company (excluding any paid-up capital held as treasury shares); or

                  (b)in the case of a company not having a share capital, members who represent at least 5% of the total voting rights of all the members having a right to vote at general meetings.

                  303(3) [repealed]

                  303(4) A request–

                  (a)must state the general nature of the business to be dealt with at the meeting, and

                  (b)may include the text of a resolution that may properly be moved and is intended to be moved at the meeting.

                  303(5) A resolution may properly be moved at a meeting unless–

                  (a)it would, if passed, be ineffective (whether by reason of inconsistency with any enactment or the company's constitution or otherwise),

                  (b)it is defamatory of any person, or

                  (c)it is frivolous or vexatious.

                  303(6) A request–

                  (a)may be in hard copy form or in electronic form, and

                  (b)must be authenticated by the person or persons making it.


                  However, either way, I would agree with leaseholdanswers. What are you trying to achieve? Forcing an EGM (which will not be pleasant) isn't really the best way UNLESS the directors are being particularly nasty about an issue.

                  Comment


                    #10
                    Yes! See the Companies (Shareholders' Rights) Regulations 2009 (S.I. 2009/1632), reg. 4(2).
                    The error in my post #4 (re '15%') stems from the http://www.legislation.gov.uk habit of cross-referencing amendments by e.g. F1; that '1' appeared joined to the '5%' producing a rogue '15%'. Sorry for the confusion!
                    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                    4. *- Contact info: click on my name (blue-highlight link).

                    Comment


                      #11
                      Thanks all.
                      We have drafted an EGM Requisition notice as follows
                      1: Expenditure – Review areas of potential savings.
                      A: Members will discuss quotes from service providers and will agree whether the new service providers should be appointed.
                      B: Members will discuss and agree whether service levels should be amended e.g frequency of window cleaning, whether lights should be replaced with sensor lights to reduce electricity costs.
                      C: Members will discuss whether there are ways in which we can protect the Estate from the damage/disrepair which has resulted in expenditure of £11,170 in 2 years.
                      D: Members will discuss and agree whether all unplanned expenditure should require the agreement of the majority of Directors prior to proceeding in order to bring expenditure under control.
                      2: Arrears
                      A: Members will ask the existing Directors to explain what action has been taken to collect £21,000 arrears and will agree whether more prompt action can be taken in the future.
                      3: Directors
                      A:NAME to be appointed as a Director of the Company with immediate effect.

                      B: NAME to be appointed as a Director of the Company with immediate effect.

                      Some residents also want to move to remove the existoing directors for confliuct of interest and mismanagement of expenditure and arrears.

                      We need the EGM because the Directors are refusing to let us apply to become Directors and are not entering into discussion about managing costs.
                      I can't see any other way forward, but if anyone has any pointers I will be very, very grateful.

                      Thanks ever so much
                      Em

                      Comment


                        #12
                        I'd consult a company-law solicitor to make sure that you get it right first time.
                        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                        4. *- Contact info: click on my name (blue-highlight link).

                        Comment


                          #13
                          You can get more FAQ info on Companies Act 2006 from BIS website ( http://bis.gov.uk )

                          2. What is the new threshold for shareholders to require the directors to call a general meeting? (regulation 4, section 303)

                          The directors are required to call a general meeting once the company has received requests to do so from members representing at least 5% paid up voting share capital, or in the case of a company not having share capital, members who represent at least 5% of the total voting rights of all the members having a right to vote at general meetings. The threshold has been reduced from 10%.

                          Comment


                            #14
                            Hello All
                            Thank you for all your advice. The Director has now agreed to appoint me and my neighbour as Directors, so now we can influence spending. He has also said he will forward me the details of the expenditure. You've all been very helpful and it has been the ability to quote the relecant Acts that changed his mind about how he was proceeding.

                            Thanks again

                            Comment


                              #15
                              No. One director cannot appoint other directors! Only the Company's members (in General Meeting) can.
                              JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                              1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                              2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                              3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                              4. *- Contact info: click on my name (blue-highlight link).

                              Comment

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