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Law Cases
Company Law Cases
Company Constitution Cases

Quin & Axtens Ltd v Salmon [1909] AC 442

Country:
United Kingdom
By Oxbridge Law Team
Held
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  • Company had two managing directors. Director A(Salmon) was given a veto by articles over any decision of company to deal with property. Director B acted contrary to requirement, and got ordinary resolutions from shareholders authorising company to act in this way.

  • Salmon sued company to stop it acting contrary to his veto.

Held

  • Ordinary Resolution

    • Is not permitted to act upon ordinary resolutions which are inconsistent with substantive requirements in articles.

      • i.e. in matters of substance, constitution can only be deviated from by special resolution.

    • Thus existence of ordinary resolution is irrelevant to whether company is breaching its articles. 

  • Qua Member

    • Director A was also a member of the company.

    • Therefore had power in his capacity as member to force company to adhere to its constitution.

      • i.e. by not dealing with property where he had used his veto.

    • Thus injunction granted against company acting upon the resolutions passed.

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