It is possible however that to have a given provision enforced, action may have to be taken against a fellow member as opposed to the company. Drury is somewhat relevant to the provision in the example being considered. In Chithambaram Chettiar vs. Krishna Aiyangar [4], a company secretary accepted the job on the remuneration of Rs. So, the principle held in Hickman is substantial, likewise therule in Eley v Positive Government Security-LifeAssurance Co Ltdin9 which held that a statutory contract only binds those whowere members and insiders of a company. The contractual nature thearticles of association hold is profound within a company in order to haveeffect on its members. 10MONDAY2020 can only be used on orders that are under 14 days delivery. This must be, as concluded in Allenv Gold Reefs of West Africa Ltd, a bona fideso, done in good faith benefitting the company. This establishment is the result of a yearlong shared appeal to strengthen the voice of outsider art by improving intercultural cooperation and dialogue across the European borders. Alteration in breach of contract. How about receiving a customized one? This essentially falls into the questions of who can sue and what can they sue for? C.B.G, ‘The contractual Effect of Articles of Association’ Modern LawReview Vol 21, No 4 (1985) 401.4Ibid 1, 159. 15MONDAY2020 can only be used on orders with a 14 day or longer delivery. To a great extent, “substantive matters, central to company’s operation, are left to be regulated by the articles” [1] . The first stage in answering this question comes from the famous dictum of Astbury J. in the Hickman case: “An outsider to whom rights purports to be given by the articles in his capacity as such outsider, whether he is or subsequently becomes a member, cannot sue on those articles, treating them as contracts between himself and the company, to enforce those rights.” [13]. 881.3L. Business Law 24th Jun 2019 As a result, it is not uncommon for contention to arise within companies regarding the effects and enforcement of the provisions in the articles. In other words, as far as this line of authority is concerned, the answer to the question is no. Theircontract however, was a different contract thus, not subject to the attributionclauses in the articles. rights that have nothing to do with the membership of the company but may cover a wide range of other issues. This Lord Wedderburn maintained could be done by using a shareholder right in a very broad sense. Are You on a Short Deadline? One may argue that only members with insider rightswithin the company are those who can enforce the articles of association,others may argue that it should be all who can enforce the provisions and somemay say it doesn’t matter. These articles are part of a company’s constitution. This provides that activities made in mala fide otherwise known as bad faith, may have beencommitted prior Joint Stock Companies Act 1844 which would make it difficult torecognise6.In Davis’ view, both statutory and ordinary contracts are alike when enforcingarticles of association7. Do you have a 2:1 degree or higher? Even a member enjoying certain rights in a capacity other than a … It can be argued that in the middle of the Wedderburn – Gower spectrum we can find G. D. Goldberg, who first proposed the example being used for consideration. Gloablink only binds the company if theprovision is contained in a separate contract between the company and officer14.In spite of this, it tends to be somewhat controversial as Beattiesuggests, that had the action been framed as a director-member action in whichthe central issue was a member suing to enforce the articles which had thetangential effect of enforcing outsider right, it may have been successful15.The controversy continues as House of Lords had stated in the case of Quin& Axtens Ltd v Salmon16, that theoutsiders right may enforce the articles of association provisions. If one is an insider however, theirinsider rights allow them to possibly enforce the articles of association asthe court in Pender v Lushington19held the shareholders right to vote should not be interfered with and like LordJessel MR illustrated that “interference with a personal right created botha derivative claim and a personal action”. This therefore meant that it is a similar effect tothe rights of an outsider whether the company or a member was enforcing thearticles of association. 5(1965) 1 WLR 3356Ibid 1.7Paul L. Davis, Gower andDavis: The Principles of Modern Company Law (8th edn, Sweet 2008).8The Law CommissionShareholder Remedies 2.9, 20.9(1876) 1 Ex D 8810(1887) 37 Ch D 111Ibid 1,154.12(2002) AII ER13(1938) Ch 708 (CA)14Ibid 1, 155.15Ibid 1, 155.16(1909) AC 44217Ibid 16.18Ibid 1, 155.19(1877) 6 Ch D 7020D Marshall Evans, ‘Quantum Meruit and the Managing Director’ The ModernLaw Review Vol 29, No.6 (1966).21 Ibid20.22 Ibid20. Nevertheless, as they were not a solicitor,they were not capable of enforcing the articles of association provision.Consequently, the rule in Eley was not applicable to outsiders which correspondswith Hickman. Copyright © 2003 - 2020 - LawTeacher is a trading name of All Answers Ltd, a company registered in England and Wales. The answer to this issue is found in the Companies Act 2006. In August 2009 the first association for European outsider art was founded at a first general assembly at Museum Dr. Guislain, Belgium. On the other extreme, one can find Professor Gower and Davies, proponents of the Hickman principle. In the caseof Quin17,he was capable to enforcing outsider rights indirectly by suing as a memberinstead of a director and the court viewed the issue in terms of enforcing amember right, which tangentially affects his right as a director rather than inthe Beattie case18. Articles Of Association Under English Law The articles of association (often just called 'articles') of a UK company contain the rules for its internal regulation and management. In the interest of full disclosure, this principle works both ways as the company would be entitled to sue the claimant in the pursuit of enforcing a provision in the articles. This would mean that there is at least an argument and the potential for the claimant in the example to proceed despite doing go in his capacity as an outsider.