Automatic Self-Cleansing Filter Syndicate Co. Ltd. v Cunninghame
Court of Appeal of England and Wales
2 Ch. 34 (Eng. C.A. 1906)
The articles of the company, Automatic Self-Cleansing Filter Syndicate Co., Ltd. (Automatic), vested the authority to manage the business in a board of directors. Directors were appointed by shareholders and could only be removed by an extraordinary resolution, meaning a vote of at least three-fourths of the shareholders. Further, the directors were empowered under the articles to do anything the company could do not specifically required by statute or the articles themselves to be done by the company and “subject to such regulations as may from time to time be made by extraordinary resolution.” McDiarmid (plaintiff) and others, collectively, owned 55 percent of Automatic’s outstanding shares. McDiarmid wanted to sell the company’s assets, which the board felt was not in Automatic’s best interests. McDiarmid was unable to secure approval of three-fourths of the shareholders. Instead, a simple majority of 55 percent of the outstanding shareholders voted to pass the resolution for the sale of assets. McDiarmid asked the court to force the sale, which the court refused. McDiarmid appealed.
Rule of Law
Holding and Reasoning (Collins, L.)
Dissent (Cozens-Hardy, L.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 174,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 14,000 briefs, keyed to 188 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.