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Articles of association

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › Articles of association

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by Vijay.
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  • May 5, 2021 at 6:04 pm #619785
    Varun.J.Thakkar
    Participant
    • Topics: 75
    • Replies: 112
    • ☆☆

    Hello sir.. i want to ask you
    The articles of association form a contract between company and members *in respect of shareholder rights only*
    How is this statement true?
    As company can sue members based on AOA

    May 10, 2021 at 3:58 pm #620231
    Vijay
    Member
    • Topics: 0
    • Replies: 258
    • ☆☆☆

    Hi Varun,

    Essentially the Articles of Association (AOA) are an internal document which contain the rights and obligations for shareholders and the company. It does not contain third party rights e.g. customers, clients, employees, directors or advisers. Therefore Shareholders can sue the company can sue shareholders if not complied with. However, directors, employees and any other third party can not sue or be sued on this document.

    I hope this clarifies?

    Kind regards,

    Vijay

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