The correct answer is: Where an alteration of the articles causes a breach of a separate contract of service, damages will not be available provided the alteration is made in accordance with the articles.

A party whose contract is contained in the articles cannot claim an injunction to prevent the articles being altered, but they may be entitled to damages for breach of contract (Southern Foundries (1926) Ltd v Shirlaw 1940 where the appointment of the managing director was made under the articles and supported by a separate service contract).

Private companies can alter their articles by written resolution. Any alteration must be bona fide in the interests of the company as a whole.