Attorney General v Davy explained

Attorney General v Davy (1741) 26 ER 531 is a UK company law case, which establishes this small but essential point of law: the default rule is that a majority of a corporate body can determine what it does.

Equivalent rules in contemporary company law are s 168 Companies Act 2006, which allows shareholders to remove directors through a simple majority, Foss v Harbottle which presupposed that a majority of shareholders can always take action to litigate, and the rule in Automatic Self-Cleansing Filter Syndicate Co Ltd v Cuninghame,^[1] which raises the requirement to 75% of the shareholders if they are to give instructions to the board.

Facts

King Edward VI had incorporated twelve people by name in a charter to elect a chaplain for the church of Kirton, just outside Boston, Lincolnshire. A clause stated that three of the twelve would choose a chaplain for the Sandford church as well, another village within the Kirton parish, with the consent of the majority of Sandford residents. A late vacancy had been created. Two of the three chose a chaplain with the majority of residents' consent, but the third dissented. The question was whether the choice was valid.^[2]

Judgment

Lord Hardwicke LC held that the chaplain was validly elected, for a corporate body can act by a majority vote at any duly summoned meeting of members.

See also

• United States corporate law
• ICS v West Bromwich BS

Further reading

• R v Varlo (1775) 1 Cowp 248

Notes and References

1. 1906
2. The Report cites the summary and facts as follows, "Case 169.— in the Vacation of Trin. Term, 1741.

   S. G. cited 1 Ves. 419.—Where a certain number are incorporated, a major part of them may do any corporate act, though nothing be mentioned in the charter.

   King Edward the Sixth, by charter incorporated twelve persons by name, to elect a chaplain for the church of Kirton, in Lincolnshire, and by another clause three of the twelve were to chuse a chaplain to officiate in the church of Sandford, within the parish of Kirton, with the consent and approbation of the major part of the inhabitants of Sandford.

   Upon a late vacancy, two of the three chose a chaplain, with the consent of the major part of the inhabitants of Sandford, the third dissented; and the question was, Whether this was a good choice."