Corporations Act 2001

CHAPTER 2B - BASIC FEATURES OF A COMPANY  

PART 2B.4 - REPLACEABLE RULES AND CONSTITUTION  

SECTION 134  

134   INTERNAL MANAGEMENT OF COMPANIES  
A company's internal management may be governed by provisions of this Act that apply to the company as replaceable rules, by a constitution or by a combination of both.

Note: There are additional rules about internal management in ordinary provisions of this Act and also in the common law.

SECTION 135   REPLACEABLE RULES  
Companies to which replaceable rules apply

135(1)    
A section or subsection (except subsection 129(1) , this section and sections 140 and 141 ) whose heading contains the words:

(a)    replaceable rule - applies as a replaceable rule to:


(i) each company that is or was registered after 1 July 1998; and

(ii) any company registered before 1 July 1998 that repeals or repealed its constitution after that day; and

(b)    

replaceable rule for proprietary companies and mandatory rule for public companies - applies:

(i) as a replaceable rule to any proprietary company that is or was registered after 1 July 1998; and

(ii) as a replaceable rule to any company that is or was registered after 1 July 1998 and that changes or changed to a proprietary company (but only while it is a proprietary company); and

(iii) as a replaceable rule to any proprietary company that is or was registered before 1 July 1998 that repeals or repealed its constitution after that day; and

(iv) as an ordinary provision of this Act to any public company whenever registered.

The section or subsection does not apply to a proprietary company while the same person is both its sole director and sole shareholder.

Note 1: See sections 198E , 201F and 202C for the special provisions that apply to a proprietary company while the same person is both its sole director and sole shareholder.

Note 2: A company may include in its constitution (by reference or otherwise) a replaceable rule that does not otherwise apply to it.

Note 3: Paragraph (a) does not apply for CCIVs: see section 1223A .



Company ' s constitution can displace or modify replaceable rules

135(2)    
A provision of a section or subsection that applies to a company as a replaceable rule can be displaced or modified by the company ' s constitution.

Failure to comply with replaceable rules

135(3)    
A failure to comply with the replaceable rules as they apply to a company is not of itself a contravention of this Act (so the provisions about criminal liability, civil liability and injunctions do not apply).

Note: Replaceable rules that apply to a company have effect as a contract (see section 140 ).


SECTION 136   CONSTITUTION OF A COMPANY  

136(1)    
A company adopts a constitution:

(a)    on registration - if each person specified in the application for the company ' s registration as a person who consents to become a member agrees in writing to the terms of a constitution before the application is lodged; or

(b)    after registration - if the company passes a special resolution adopting a constitution or a court order is made under section 233 that requires the company to adopt the constitution.

Note 1: The Life Insurance Act 1995 has rules about how benefit fund rules become part of a company ' s constitution and about amending those rules. They override this Act (see section 1348 of this Act). Consequential amendments to the rest of the company ' s constitution can be made under that Act or this Act (see Subdivision 2 of Division 4 of Part 2A of that Act).

Note 2: Section 1223B applies instead of this section in relation to the constitution of a CCIV (see also subsection 1223D(6) ).


136(2)    
The company may modify or repeal its constitution, or a provision of its constitution, by special resolution.

Note: The company may need leave of the Court to modify or repeal its constitution if it was adopted as the result of a Court order (see subsection 233(3) ).


136(3)    
The company ' s constitution may provide that the special resolution does not have any effect unless a further requirement specified in the constitution relating to that modification or repeal has been complied with.

136(4)    
Unless the constitution provides otherwise, the company may modify or repeal a further requirement described in subsection (3) only if the further requirement is itself complied with.

136(5)    
A public company must lodge with ASIC a copy of a special resolution adopting, modifying or repealing its constitution within 14 days after it is passed. The company must also lodge with ASIC within that period:

(a)    if the company adopts a constitution - a copy of that constitution; or

(b)    if the company modifies its constitution - a copy of that modification.

This also applies to a proprietary company that has applied under Part 2B.7 to change to a public company, while its application has not yet been determined.


136(6)    


An offence based on subsection (5) is an offence of strict liability.

Note: For strict liability , see section 6.1 of the Criminal Code .


SECTION 137  

137   DATE OF EFFECT OF ADOPTION, MODIFICATION OR REPEAL OF CONSTITUTION  
If a new constitution is adopted or an existing constitution is modified or repealed, that adoption, modification or repeal takes effect:


(a) if it is the result of a special resolution:


(i) on the date on which the resolution is passed if it specified no later date; or

(ii) on a date specified in, or determined in accordance with, the resolution if the relevant date is later than the date on which the resolution is passed; or


(b) if it is the result of a Court order made under section 233:


(i) on the date on which the order is made if it specifies no later date; or

(ii) on a date specified by the order.

SECTION 138  

138   ASIC MAY DIRECT COMPANY TO LODGE CONSOLIDATED CONSTITUTION  
ASIC may direct a company to lodge a consolidated copy of its constitution with ASIC.

SECTION 139   COMPANY MUST SEND COPY OF CONSTITUTION TO MEMBER  

139(1)   [ Requirements]  

A company must send a copy of its constitution to a member of the company within 7 days if the member:


(a) asks the company, in writing, for the copy; and


(b) pays any fee (up to the prescribed amount) required by the company.

139(2)   [ Strict liability offence]  

An offence based on subsection (1) is an offence of strict liability.

Note: For strict liability , see section 6.1 of the Criminal Code .

SECTION 140   EFFECT OF CONSTITUTION AND REPLACEABLE RULES  

140(1)   [ Contract]  

A company's constitution (if any) and any replaceable rules that apply to the company have effect as a contract:


(a) between the company and each member; and


(b) between the company and each director and company secretary; and


(c) between a member and each other member;

under which each person agrees to observe and perform the constitution and rules so far as they apply to that person.

140(2)   [ Binding nature of modification to constitution]  

Unless a member of a company agrees in writing to be bound, they are not bound by a modification of the constitution made after the date on which they became a member so far as the modification:


(a) requires the member to take up additional shares; or


(b) increases the member's liability to contribute to the share capital of, or otherwise to pay money to, the company; or


(c) imposes or increases restrictions on the right to transfer the shares already held by the member, unless the modification is made:


(i) in connection with the company's change from a public company to a proprietary company under Part 2B.7; or

(ii) to insert proportional takeover approval provisions into the company's constitution.

SECTION 141  

141   TABLE OF REPLACEABLE RULES  


The following table sets out the provisions of this Act that apply as replaceable rules.


Table for replaceable rules
Table for replaceable rules
Provisions that apply as replaceable rules
  Officers and Employees  
1 Voting and completion of transactions - directors of proprietary companies 194
2 Powers of directors 198A
3 Negotiable instruments 198B
4 Managing director 198C
5 Company may appoint a director 201G
6 Directors may appoint other directors 201H
7 Appointment of managing directors 201J
8 Alternate directors 201K
9 Remuneration of directors 202A
10 Director may resign by giving written notice to company 203A
11 Removal by members - proprietary company 203C
12 Termination of appointment of managing director 203F
13 Termsand conditions of office for secretaries 204F
  Inspection of books  
14 Company or directors may allow member to inspect books 247D
  Director ' s Meetings  
15 Circulating resolutions of companies with more than 1 director 248A
16 Calling directors ' meetings 248C
17 Chairing directors ' meetings 248E
18 Quorum at directors ' meetings 248F
19 Passing of directors ' resolutions 248G
  Meetings of members  
20 Calling of meetings of members by a director 249C
21 Notice to joint members 249J(2)
22 When notice is given 249J(4)
22A (Repealed)  
23 Notice of adjourned meetings 249M
24 Quorum 249T
25 Chairing meetings of members 249U
26 Business at adjourned meetings 249W(2)
27 Who can appoint a proxy 249X
  [ replaceable rule for proprietary companies only ]  
28 Proxy vote valid even if member dies, revokes appointment etc. 250C(2)
29 How many votes a member has 250E
30 Jointly held shares 250F
31 Objections to right to vote 250G
32 How voting is carried out 250J
33 When and how polls must be taken 250M
  Shares  
33A Pre-emption for existing shareholders on issue of shares in proprietary company 254D
33B Other provisions about paying dividends 254U
34 Dividend rights for shares in proprietary companies 254W(2)
  Transfer of shares  
35 Transmission of shares on death 1072A
36 Transmission of shares on bankruptcy 1072B
37 Transmission of shares on mental incapacity 1072D
38 Registration of transfers 1072F
39 Additional general discretion for directors of proprietary companies to refuse to register transfers 1072G