Question

Explain four differences between the corporate documents forming the 'Doctrine of Indoor Management' and 'Doctrine of Outdoor Management', on the criteria of:
(a) Meaning (b) Scope (c) Contents (d) Compulsion

Answer 1

Basis	Doctrine of Indoor Management	Doctrine of Outdoor Management
(a) Meaning	It protects outsider against the company. The doctrine of indoor management follows from the doctrine of ‘constructive notice’ laid down in various judicial decisions. The hardships caused to outsiders dealing with a company by the rule of‘constructive notice’ have been sought to be softened under the principle of ‘indoor management’. It affords some protection to the outsiders against the company.	It protects the company against the outsider. Doctrine of constructive notice is a doctrine where all persons dealing with a company are deemed (or "construed") to have knowledge of the company's articles of association and memorandum of association.
(b) Scope	It is confined to the internal position and affairs of the company.	It is confined to the external position and affairs of the company.
(c) Contents	The internal affairs need not be registered. They are not open to public and third parties.	The memorandum and articles of association of the company are public documents. They must be registered with the Registrar of Companies. These are open to public and third parties to access.
(d)Compulsion	Third persons, who have no notice to any irregularity or want of authority, will be protected on the principle called the ‘Turquand Rule’.	Third persons, who have no notice of an irregularity or want of authority, if they try they could know about that irregularity or want of authority, will not be protected on the principle of ‘constructive notice’