Some reflections on the general meeting's power to control corporate proceedings

Abstract

The jurisprudence on the power of the general meeting of a company to control corporate actions has been developed largely through the courts' interpretation of various versions of constitutional provisions on corporate power allocation, all of which can be traced back to the Companies Act 1862 (UK), Table A, reg. 55. This body of jurisprudence is likely to be resorted to when a need for resolving a similar question arises, regardless of how the power allocation provision is worded under the current model company constitution in the relevant jurisdiction. This article discusses two different schools of views on corporate power allocation. The mainstream view is that where the management power is vested in the directors, it is not a matter where the general meeting can intervene. However, the author feels that this view is doctrinally unsustainable. Instead, the author agrees with the view that the general meeting's power to make management, and hence corporate litigation, decisions is determined by the parties' intention manifested in the words in all forms of company regulations. This article also argues that regardless of how the relevant constitutional provision on division of corporate powers is worded, the general meeting has power to act where a board that is capable of making impartial decisions is unavailable.