Key Instances of the Interrelationship between the
Articles of Association, Shareholders Agreements, the Companies Act
Cap 113 and common law principles
Whilst it is of crucial importance that a company's
Articles of Association (AA) and
Shareholders' Agreement (SHA) should be such
as to ensure that their respective provisions are compatible, it
would be prudent to deal with any inconsistencies that might
nevertheless emerge between the AA and the
SHA, by incorporating in the latter document an
appropriately drafted clause – a priority provision - to the
effect that in the event of a clash, the SHA would
prevail.
In the context of the foregoing, should such a conflict arise as
to the provisions of the two documents, the matter of alteration of
the AA would necessarily surface. In essence, the
priority provision (which stipulates that the SHA
will prevail in cases of inconsistency), would effectively operate
to constitute an alteration of the AA. Such a
variation
