RTM – Managing the company

 

Model articlesThe Model Articles provide a great deal of flexibility and the RTMC may establish it’s own operating rules as long as these keep to the Articles.

Directors take decisions collectively

The Board of Directors acting collectively is the decision-making body.

[Art 12] Any decision of the directors must be either a majority decision at a meeting or a decision taken in accordance with article 13.

[Art 13] A decision of the directors is taken in accordance with article 13 when all eligible directors indicate to each other by any means that they share a common view on a matter. Such a decision may take the form of a resolution in writing, copies of which have been signed by each eligible director or to which each eligible director has otherwise indicated agreement in writing.

Calling a directors’ meeting

[Art 14] Any director may call a directors’ meeting by giving notice of the meeting to the directors.

Notice of any directors’ meeting must indicate its proposed date and time; where it is to take place; and, if it is anticipated that directors participating in the meeting will not be in the same place, how it is proposed that they should communicate with each other during the meeting.

Quorum for directors’ meetings

Art 16] At a directors’ meeting, unless a quorum is participating, no proposal is to be voted on, except a proposal to call another meeting.

The quorum for directors’ meetings may be fixed from time to time by a decision of the directors, but it must never be less than two, and unless otherwise fixed it is two.

If the total number of directors for the time being is less than the quorum required, the directors must not take any decision other than a decision—

(a) to appoint further directors, or

(b) to call a general meeting so as to enable the members to appoint further directors.

Records of decisions to be kept

[Art 20]. The directors must ensure that the company keeps a record, in writing, for at least 10 years from the date of the decision recorded, of every unanimous or majority decision taken by the directors.

Directors’ discretion to make further rules

[Art 21]. Subject to the articles, the directors may make any rule which they think fit about how they take decisions, and about how such rules are to be recorded or communicated to directors.

This freedom to make rules would not allow the directors to impose any restriction on the rights of directors as provided for in the articles, but would allow making rules on procedures. The Board could use video-conferencing or agree when to use emailing or have face-to-face meetings strictly on the understanding that non-present directors can still participate, e.g. using text messaging or by phone.

An RTMC cannot over-rule rights contained in the Articles for members or directors.

Decision-making by members

Members who do not wish to be directors effectively leave the running of the company to the directors. Members can remove directors according to the Articles.

[Art 29]. The quorum for a meeting shall be 20 per cent of the members of the company entitled to vote, or two members of the company so entitled (whichever is the greater) present in person or by proxy.

[Art 33]. At General Meetings voting is by show of hands unless a poll is validly demanded under Art.35. Where Members are registered jointly for a single flat, any one of them may vote, but where more than one votes, only the vote of the senior shall be accepted, seniority being determined by the order in which the names of such persons appear in the register of members in respect of the flat or lease (as the case may be) in which they are interested.

Meetings shall be conducted efficiently and fairly, and each decision shall be made after discussion followed by majority vote.

Management Committee

The Board of Directors may create and delegate authority to a Management Committee (Art. 10). Committees to which the directors delegate any of their powers must follow procedures which are based, so far as they are applicable, on those provisions of the Articles which govern the taking of decisions by directors.

Emails and their attachments offer the best means of sharing facts, documents and decision-making between face-to-face meetings, and meet the legal requirements.

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