RDC Property Developments Pty Ltd ("RDC") specialises in the development and sale of commercial property and is a profitable company. The issued share capital of the company comprises of 20,000 fully paid ordinary shares and 3,000 preference shares. Jane is the managing director and owns 9,000 ordinary shares, Karen owns 7,000 ordinary shares and Wayne owns 4,000 ordinary and 1,000 preference shares. Karen also owns 2,000 preference shares. Karen has appointed Jane as proxyholder for her shares and Jane can vote in any way she wishes.
Clause 7 of the constitution provides that at any general meeting only the ordinary shareholders have the right to vote (with a weighting of 1 vote per share) unless the resolution involves one of the following matters:
Share capital reduction;
Any rights enjoyed by the preference shareholder under the constitution; and
Approval of a share buy-back scheme.
In each of the above matters, the preference shareholder has the right to vote with a weighting of 2 votes per share.
Jane has drafted a resolution which is to be put to the next general meeting:
Resolution 1: Preference shareholders have 1 vote per share on the matters listed in Clause 7 of the Constitution
Wayne is outraged at the proposed resolution. Advise Wayne as to whether the proposed resolution will comply with the Corporations Act and the remedies available to Wayne if the resolution is passed.