Explanatory Note to Auditors Regarding Change to Articles (Sole Director Companies)

Considering the 2022 case of Hashmi v Lorimer-Wing, the sole director company may wish to adopt new articles of association and will need to get shareholder consent for doing this (most likely by a shareholders’ written resolution).

If a company proposes to make amendments to its articles of association, it is often helpful for the company secretary or sole director to produce a written note explaining the changes that can then be circulated to interested parties such as shareholders or the company’s auditors.

This template note should explain the changes that are being made to the company’s existing articles and then included with the written resolution to approve the changes.

This note is designed for use by a private company with a sole director.

This template should be read in conjunction with the guidance note and other templates that relate to the case of Hashmi v Lorimer-Wing as well as considering the subsequent case of Re Active Wear which gives a contrary judgment to Hashmi. 

It is recommended to seek independent legal advice before making any changes to a company's constitution.

The document is in open format. Fields should be completed where indicated. Wording in square brackets is optional and can be deleted or retained according to requirements.

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