Under the Companies Act 2006, there are two types of resolutions that the members(shareholders) can use to make decisions: ordinary resolutions and special resolutions. Ordinary resolutions are passed by a simple majority of shareholders at a meeting or by way of a written resolution, while special resolutions require a higher level of support from shareholders and are also passed either at a meeting or by written resolution.
An ordinary resolution is a decision that is made by a company’s shareholders, whether at a meeting or by circulating a written resolution. In order to pass an ordinary resolution, at least 50%+1 of the shareholders must vote in favour of the resolution. If the resolution is passed, it becomes binding on the company.
A special resolution, on the other hand, is a decision that requires a higher level of support from shareholders in order to be passed. In order to pass a special resolution, at least 75% (not 75%+1) of the shareholders must vote in favour of the resolution. Special resolutions can be passed either at a meeting or by written resolution.
Under section 282(1) of the Companies Act 2006, the shareholders may pass an ordinary resolution either at a meeting or by written resolution if by a simple majority of the total voting rights of the eligible members.
Under section 283(2) of the Companies Act 2006, the shareholders may pass a special resolution either at a meeting or by written resolution if it is supported by at least 75% of the shareholders voting.
Section 284 explains the general rules of voting as every member has one vote in respect of each share he owns.
In summary, the main difference between an ordinary resolution and a special resolution is the level of support required from shareholders in order to be passed. Ordinary resolutions require a simple majority of at least 50%+1 of shareholders to vote in favour, while special resolutions require a higher level of support from at least 75% of shareholders, and both resolutions can be passed either at a meeting or by written resolution.