Resolutions

Resolutions

Resolutions are described by Companies House as “an agreement or decision made by the directors or members (or a class of members) of a company. When a resolution is passed, the company is bound by it.”

(Source Companies House website)

Resolutions are passed all the time by companies and Companies House requires a copy of many of them. The resolution has to be sent to the Registrar within 15 days after it has been passed.

A resolution is passed by means of a vote at a general meeting of the company. It is done according to the rules stated in the company’s articles of association which states the internal affairs of the company. The resolution is carried by a show of hands in favour and then it can be passed.

When a resolution is proposed all company members must be sent a copy of it, as well as any auditors if the company has them.

There are eight different types of resolutions:

• Directors resolutions
• Ordinary resolutions
• Extraordinary resolutions
• Special resolutions
• Elective resolutions
• Written resolutions
• Class resolution
• Shareholder resolutions

If any decision is to be made affecting the day to day running of the company, then a resolution must be passed. These include plans to change the company’s name, revoking or renewing the authority of one of the directors, or modifying the rights of classes of shareholders. A resolution must also be passed if there is to be any changes in the memorandum or articles of association or if the directors are going to voluntarily wind up the company.

Certain resolutions must be sent along with completed statutory forms signed by the directors. For example a resolution to authorise an increase of share capital must be sent to Companies House with Form 123 – notice of increase in nominal capital.

Companies House do not have standard forms for resolutions, but they do stipulate that resolutions are in printed form and that they are received within 15 days of the date it was made or passed.

Scanned images of these Resolutions are available to purchase from checkSURE for just £7.95.