The Power of a Special Majority of Shareholders, or of All Shareholders Acting Informally, to Override Directors — Att-Gen v. Ririnui
10 Pages Posted: 23 Sep 2015
Date Written: September 21, 2015
An important issue of corporations law is whether the shareholders of the company (or members of other sorts of corporation) can dictate to directors or the management committee on a particular matter, or override a management decision. The answer will often turn on the relevant incorporation statute. This article is concerned with the position under the standard company statutes used in such countries as the United Kingdom and New Zealand. It argues that under this longstanding model, shareholders can by special majority using the constitution, or otherwise by acting unanimously, dictate to and override directors on a management issue. The focus of the article is a recent decision of the New Zealand Court of Appeal, Att-Gen v. Ririnui (2015), currently under appeal to the Supreme Court.
Keywords: Corporations, companies, shareholder power, overriding directors, management decisions, unanimous assent, Duomatic, constitutional provisions
JEL Classification: D23, D70, D74, G30, G34, K10, K12, K22
Suggested Citation: Suggested Citation