Company Meetings: Notices, Quorum, Resolutions and Minutes
What the exam tests
This domain examines the machinery of decision-making: convening valid general meetings, counting quorum, choosing the correct resolution type, handling proxies and producing minutes that stand up as evidence.
Core rules
- The first AGM is held within 18 months of incorporation; thereafter at least once every calendar year with no more than 15 months between meetings. CAMA 2020 permits a private company to dispense with the AGM where all members agree.
- Notice for a public company AGM is at least 21 days. It must state the date, time, place or electronic platform, the general nature of the business, and the member's right to appoint a proxy. Shorter notice requires the consent of the requisite majority of members entitled to attend and vote.
- Quorum: two members for a private company and three for a public company, present in person or by proxy, unless the articles prescribe a higher number. Without quorum, the meeting is adjourned.
- Ordinary resolutions pass by a simple majority of votes cast; special resolutions need not less than 75% of votes cast. Written resolutions are possible where the CAMA and articles allow.
- Special notice of 28 days is required for removing a director or auditor; the company must then give members notice of the proposed resolution.
- Minutes must be entered in the minute book and signed by the chairman; they are prima facie evidence of proceedings.
Worked example
A private company with four members wants to remove a director and amend its articles at one meeting. The secretary must give 28 days' special notice of the removal proposal, then at least 21 days' notice of the meeting setting out both items; the article amendment needs a 75% special resolution. The director may make written representations, which must be circulated. Voting is counted on votes cast, not on total issued shares.
Traps
Computing a special resolution on total share capital rather than votes cast; omitting the director's right to representations; treating unsigned draft minutes as evidence; assuming proxies cannot be counted for quorum.