Ordinary Resolution or Special Resolution? Or not legal anyway?

[PaulaS]

There is a block of 100 flats where each flat owner has one share in the freehold company (FC Ltd, total share capital 100 shares). FC Ltd owns the freehold and is responsible for service charges, maintenance etc. The directors want to propose a resolution at the next AGM so that only owner-occupiers can be directors.

1) Would this be an Ordinary or a Special resolution?
2) Are there any legal issues in doing this (as in, would any resolution actually be legal)?

The company Articles don't say anything relevant.

 

[Baines Watson]

There is a block of 100 flats where each flat owner has one share in the freehold company (FC Ltd, total share capital 100 shares). FC Ltd owns the freehold and is responsible for service charges, maintenance etc. The directors want to propose a resolution at the next AGM so that only owner-occupiers can be directors.

1) Would this be an Ordinary or a Special resolution?
2) Are there any legal issues in doing this (as in, would any resolution actually be legal)?

The company Articles don't say anything relevant.

1) I would think this would be a special resolution as this would not be something that can be considered a routine matter which requires ordinary resolution
2) I would say such a resolution could be open to legal challenges due to the discriminatory nature of it i.e. restricting directorship to owner occupiers could be seen as limiting the ability of the landlord owners to participate in the management of the company, best to take legal advice on this before proceeding.

 

[David Griffiths]

I agree that this would almost certainly need to be a special resolution, as it would change the provisions of the company's articles. Indeed a resolution to change the articles to include the provision would probably be the best way forward.

However, i also agree that this would be subject to legal challenge for removing the rights of (presumably minority?) shareholders

Legal advice is essential