Part 5 Memorandum of association
June 2011
The provisions introducing the revised memorandum of association (see paragraph 75.53) came into force on 1 October 2009 [Note 1] . Companies incorporated before that date will have adopted an old style memorandum which provided important information and specified what a company could do. The official receiver will be likely to come across these types of memorandum for some time to come.
The pre 1 October 2009 memorandum included details of the company’s name, the country its registered office was located in, its objects (see paragraph 75.54), whether its liability was limited by shares, details of its share capital and an association clause which was signed by subscribers to indicate they were taking a share in the company. These clauses are now to be treated as provisions of the company’s articles unless the company has specifically altered its articles of association to amend them [Note 2].
The objects clause sets out the purpose of the company and defines its contractual capacity. Prior to the Companies Act 1985 if the company entered into a contract outside of its object clause it would be void and unenforceable. The provisions of the Companies Act 1985 and now the Companies Act 2006, allow the company to be bound to any contract it enters into. [Note 3]. The directors have the power to bind a company to a contract as long as the third party deals with it in good faith [Note 4].
75.55 Official receiver and the objects clause
Unless a company adopts a particularly restrictive objects clause it is unlikely that any contract a company enters into will be void and unenforceable.
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