To ratify a breach of duty by directors, what type of resolution is required?

To ratify a breach of duty by directors, an ordinary resolution is required. This is because the Companies Act provides that decisions made by directors, including lapses in duty, can be ratified by the shareholders through an ordinary resolution. An ordinary resolution typically requires a simple majority of votes in favor at a general meeting, making it accessible for shareholders to approve or disapprove actions taken by directors.

Ratification is a mechanism that allows shareholders to bring actions of the directors into compliance with company rules and policies, preventing any potential consequences that may arise from the breach. This ensures that the decisions made by the directors remain within the bounds of legality as recognized by the shareholders.

In contrast to ordinary resolutions, supermajority resolutions require a higher percentage of votes to pass, which does not apply in this context. A special resolution, which requires at least 75% of the votes, is typically utilized for more significant changes within a company, such as amendments to the articles of association, rather than for ratification of breaches. Unanimous consent would imply that all shareholders must agree, which is generally impractical and not a common requirement for issues that can be resolved through ordinary resolutions.