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Notice of meetings – requirements and good practice

In this article we highlight the requirements for adequate and correct meeting notices (for Societies and companies), look at good practice and also draw your attention to some of the common pitfalls (which can actually lead to the proceedings of the relevant meeting being declared invalid).

The rules for meetings differ depending upon the legal structure you are using.

There are no specific provisions in the Incorporated Societies Act 1908 setting out requirements for Notices of meetings. Reference should always be made to the Constitution of the relevant Society and the provisions followed closely.

For companies, Schedule 1 of the Companies Act 1993 requires that written notice of the time and place of a meeting of shareholders be sent to every shareholder entitled to receive such notice and to every director and an auditor of the company not less than 10 working days before the meeting. For board meetings, Schedule 3 of the same Act provides that not less than 2 days’ notice of a meeting must be sent to every director who is in New Zealand, and the notice must include the date, time and place of the meeting and the matters to be discussed. The Constitution of the relevant company may of course prescribe longer periods of notice so it should always be checked.

What does “X days’ notice” mean?
Sometimes a Constitution made provide that “X days’ notice” or “X days’ clear notice” is required. The Courts have determined that even where “clear” is not part of the wording, the principle is the same – both the day of posting or sending of the Notice and the day of the meeting (and any part days) must be excluded from the calculation. Should the wording refer to a different measurement of time – for example weeks or months etc – the same principles apply.

What form should the Notice take?
The Companies Act 1993 prescribes that a Notice of a meeting of shareholders must be in writing. The same Act does not require Notice of a board meeting to be in writing, but the Constitution of the relevant company might – and, in practice, we would certainly recommend it.

The Constitution of most Societies will require Notices of meetings to be in writing – and again, even if the Constitution does not require it, we would recommend it.
Some organisations will make special provision for the calling of meetings (especially committee meetings) by phone or fax, and large meetings are often called by notice in a newspaper circulating in the relevant area. The important thing is that the meeting is called in such a way that adequate notice is given to all entitled parties or members.

What should the Notice contain?
Subject to the specific requirements of the Constitution of the relevant organisation, good practice would be for the Notice to contain:

• The date, time and place of the meeting;
• An explanation as to the reason for the meeting;
• An Agenda/list of the matters to be dealt with. This should be detailed and should include the wording of any motions proposed along with any background information and reports or recommendations that are relevant. Recipients of the Notice should not be directed to an external source for information – for example a Notice directing recipients to the organisation’s website for additional information would not be sufficient to meet the requirements of a valid Notice.

What defects have caused the Courts to hold meetings to be i

nvalid?

The following are some examples of situations/problems with Notices which have led the Courts to declare meetings invalid due to inadequate or inappropriate notice:

1. The Notice does not give the date, time and place of the meeting.
2. The Notice is ambiguous or misleading – good practice would always be for the Notice to be couched in clear and plain terms.
3. The Notice comes from someone who does not have the requisite authority – as usual, the Constitution of the relevant organisation is the first port of call here but usually it will be the responsibility of the Secretary to send out Notices. However, in one case it was held that a meeting was improperly convened where the Secretary sent out Notices without the authority of the board.
4. The Notice is unreasonable or the meeting deliberately held at a time or place intended to prevent some members attending.
5. The period of notice is insufficient.
6. The Notice is conditional – a valid Notice must not be dependent upon some other event taking place.
7. The Notice does not fully specify the reason for the meeting or does not give sufficient information as to the nature of the business to be discussed – for example, the Courts have held that it was insufficient for a Notice to say that a meeting was to “report and discuss the matter” relating to a certain person, when in fact the meeting was convened to discuss that person’s expulsion from the organisation.
8. Where some members were not sent proper notice – for a particularly strict application of this see below.

Miscellaneous

1. 1. Some Constitutions make provision for regular meetings taking place on the same day of the week or month at the same place. In these circumstances, Notice of those meetings is not usually required. However, an agenda should still be circulated and good practice would be for a schedule of the meetings to be sent to all of the relevant parties in advance.
2. 2. In one case it was held that a meeting was invalid because the Notice was not sent to one member, despite the fact that the member in question had already advised the relevant Society that she did not intend to attend meetings!
3. 3. The Companies Act 1993 provides that an irregularity in a Notice of a meeting (of shareholders or directors) can be waived if all the shareholders/directors entitled to receive notice/attend the meeting, do attend the meeting without protest as to the irregularity, or agree to such waiver.

For Societies, yes – you’ve guessed it, the Constitution may well contain provisions for validation or waiver in relation to an invalid notice, either at the relevant meeting or subsequently.

In either case, you will not be surprised to learn that it is better to get the Notice right in the first place, rather than rely on subsequent validation or waiver by the affected parties.