The issues affecting the
validity of a meeting bother mainly on venue, notification and how to notify, as
well as where and who attends the meetings.
1.
Venue of Meeting
Company meetings that must
be held in Nigeria are Statutory Meeting
and Annual General Meeting:
section 216 of the CAMA. Thus, Extra–Ordinary
General Meeting need not hold in Nigeria.
2. Eligibility to Attend Company Meeting
The following persons are entitled to receive Notice
of a general meeting, and thus are eligible to attend.
a.
Every member
b.
Legal representative, receiver or a trustee in
bankruptcy of a member.
c.
Every director of the company.
d.
Every auditor of the company
e.
Company Secretary
Please note that apart
from the listed persons, no other person is entitled to receive Notices of
General Meetings and/or attend meetings: section
219(2) of the CAMA. Section 363(1) of the CAMA reconfirms the fact that a
company’s auditor shall be entitled to attend any general meeting of the
company and to receive all notices
3. Notice of Meeting
No business must be discussed in a meeting unless
notice of it has been duly given: section
218(3) of the CAMA. Where a members is entitled to appoint a proxy, the
notice must specifically state so.
Those entitled to receive notice of Annual General
Meeting are –
(a) every members
(b) every person
upon whom the ownership of a share devolves by reason of his being a legal
representative, receiver or trustee in bankruptcy of a member
(c) every director
of a company
(d) every auditor
of the company for the time being and
(e) company
secretary. – section 219 of the CAMA.
A creditor is not included except the object clause
is changed in the company's Articles. A member is entitled to a copy of the Minutes
of Meeting within 7 days of the meeting. The quorum of a meeting that is the
total number of those present at a meeting in order for the meeting to be
effective, is 1/3 of the total members or 25 members whichever is lesser
present in person or by proxy unless the company's Articles provide otherwise.
Contents
of a Notice of Meeting: section 218 of the CAMA.
A valid notice of a meeting must specify:
a.
The place (venue), date and time of the meeting;
b.
The type of meeting;
c.
Agenda, that is to say, the general nature of the business to be
transacted;
d.
For Annual General
Meeting, it is to be stated in the Notice; that the meeting is to transact “Ordinary Business” and the particulars
of same must be stated. It is enough to put that ‘Ordinary Business’ shall be
transacted. On the other hand, for Special
Business, the terms of the resolution should be set out.
e.
Provision should be made for proxy attendance.
f.
It should be expressed to be By Order of the Board of Directors; or Requisitioned by Members, or
By Order of the Court depending on the authority that convened the meeting.
g.
Signed by Company Secretary and Dated
Length
of Notice: (section
217 of the CAMA)
The notice required for
all types of general meetings shall be 21
days from the date on which the notice was sent out. However, a shorter notice may be agreed by all the members entitled to attend and vote at the Annual General Meeting OR by members representing 95% of the voting rights or shares for other General meetings: section 217(2) of the CAMA.
Service
of Notice (section
220 of the CAMA)
a.
Personal service
b.
By post to the person entitled or to his registered
address.
If he has no registered
address within Nigeria, the notice may be sent to the address if any supplied
by him to the company for giving of notice to him.
Where a notice is sent by
post and the letter is properly addressed and stamped, then the addressee is
deemed to receive it 7 days after the
letter is posted: section 220(2) of the
CAMA. Thus, the 21 days is
calculated from that time.
Effect
of Failure to Give Notice of Meeting
Failure to give notice of
meeting to a person entitled to receive it shall, when he applies to court,
invalidate the meeting. The exception is where such failure is an accidental
omission on the part of the persons giving the notice. However, if the failure
was due to a misrepresentation or
misinterpretation of the provisions of CAMA
or the Articles, this shall not amount to accidental omission: section 221(2) of the CAMA and Longe v First Bank.
Additional
Notice for Public Companies (section
222 of the CAMA)
In addition to the normal
individual notices sent out, every
Public Company (PLC) shall at least
21 days before any General meeting advertise a notice of such meeting in at
least two daily newspapers.
Current
Trends in Corporate Governance
·
Adequate notice
·
Service of notices must be effective and proposed to
reach the company
·
Proof of services
4.
Proxy
Proxy means a person
nominated by any member to attend a company meeting on his behalf, takes part
in the voting and can exercise the same right as the member appointing him. A member
who appoints a proxy must be entitled to attend and vote at the meeting. A proxy may not be a member of the company:
section 230(1) of the CAMA. Proxy is not allowed in a company without share
capital unless its Articles permit.
How
a Proxy is Appointed
a.
The Notice of meeting must provide for member’s right to appoint proxy: section 230(2) of the CAMA. Breach of
this constitutes an offence under section 230(2)
of the CAMA.
b.
The instrument appointing a proxy shall be in writing
under the hand of the appointer or of his Attorney duly authorised in writing.
If the appointer is a corporation, the Proxy Instrument shall either be under
seal or under the hand of an officer or Attorney duly authorised: section 230(6) of the CAMA.
c.
The Proxy instrument shall be deposited at the
registered office or head office of the company or at such other place within
Nigeria as is specified for that purpose in the Notice of the Meeting: section 230(7) of the CAMA.
d.
Proxy Form/Instrument is to be lodged not later than 48 hours before a meeting or adjourned
meeting: section 230(3) of the CAMA. If
it is an instrument in respect of Poll
voting, it has to be deposited not
less than 24 hours before the time appointed for the taking of poll: section 230(7) of the CAMA.
Revocation
of Proxy’s Appointment
The appointer may have a
change of mind after appointing a proxy. He is allowed to revoke the
Proxy and attend the meeting of himself. But unless he has successfully revoked
the Proxy, he can no longer be allowed in the meeting as he would have double
attendance.
Procedure
For Revocation of Proxy Instrument
For the Proxy to be
validly revoked, the Revocation must be communicated
to the company timely before the commencement of the meeting or adjourned
meeting in which the Proxy is to be used. This rule also applies upon
death, insanity or transfer of share except information in writing of such
death, etc. has been received by the company before commencement of the
meeting.
5.
Corporate Representation
A company, which is a
shareholder or member of another company is required to appoint any person by a
Resolution of the Board or Governing Council, to be its representative in the
general meetings of the company of which it is a member: section 231 of the CAMA. Please note that such a Representative is not thereby a Proxy and can therefore
exercise the right of the Company: section
231(2) of the CAMA. For example, the representative can appoint a Proxy under section 230(1) of the CAMA.
A
creditor of a company (including a holder of debentures) of another company can also appoint a Representative to be attending the
creditors meeting in the debtor company: section
231(1)(b) of the CAMA.
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