Company meetings

The importance of meetings

• Company decisions are collective
decisions
• Small companies and big companies
• Many technical rules governing the
conduct of company meetings
• The courts recognize that meetings are
generally not run by lawyers and that a
liberal interpretation is required.
• In Maori Development Corporation Ltd v Power
Beat International (1995) 7 NZCLC 260:
“it is undesirable that where lay people are trying
to exercise the democratic rights of
shareholders, especially at a meeting under the
control of a lay person, what they do and say
should be given a narrow and technical
construction, particularly where that can be
seen as extremely thwarting the intention of the
shareholder in relation to the exercise of a right
to vote.”
 Types of meetings
• Two types of meetings are provided for by the
Act: annual meetings and special meetings

• The meeting must be properly constituted:

- Proper notice must be given
- The quorum or minimum number of persons
must be present
- No person entitled to attend should have been
excluded
- Any procedures followed in the company’s
constitution must be followed
 First annual meeting
• Requirement removed from the Companies Act
• The only meetings which need to be held are the
annual meetings
• S 115 (2) : A company may not hold its first
annual meeting in the calendar year
of its incorporation but shall hold that meeting
within 18 months of its incorporation.
•  
 Annual meetings
• The requirement to hold a meeting of
shareholders once in each calendar year
• The responsibility of the board of directors
to call the meeting and the company is
obliged to hold the meeting on the day for
which it is called
• Once the meeting has been called, the
directors have no power to postpone it
• When should the meeting be held?

not more than once in each year;

not later than 6 months after the balance sheet

date of the company; and

not later than 15 months after the previous

annual meeting.
• The Act does not state what business is to be
transacted at the meeting. The ordinary
business will be:
- The consideration of the accounts and directors’
and auditor’s reports
- The election of directors in place of those retiring
- The appointment of directors

• Other matters may be transacted at the annual

meetings but particulars of this will have be
given to shareholders in the notice of the
meeting. In many companies, the meeting will be
little more than a formality.
• Signed resolutions:

• The Act makes provision for decisions

without a meeting where the required
majority of shareholders signs a
resolution. If all the business of the annual
meeting is dealt with in this way, there is
no need to call an annual meeting.
 Special meetings – S 116
• Every meeting of shareholders, other than
an annual meeting is known as a special
meeting. They are called by the board of
directors or by any person who is
authorised to do so by the constitution?
Any business which may be properly dealt
with by the shareholders may be
considered at a special meeting, provided
that sufficient notice has been given.
• The shareholders can call for a special meeting.
• Such a request is required to be in writng and
must be made by shareholders whose shares
carry at least 5% of the voting rights entitled to
be exercised on that issue.
• The request does not have to be signed; it is
preferable and it must also state the reason for
requiring the meeting so that proper notice can
be given.
• When the directors receive a request of this
nature, they are obliged to call a special meeting
and they have to act within a reasonable time.
• The power of the court to order a meeting
– S 118.

• It is impracticable to call or conduct a

meeting in the manner prescribed by the
Act or the constitution
• It is in the interest of the company that the
meeting be held