Minutes and minute books

Question 1

Can directors take decisions via written resolutions?

Must directors’ written resolutions be kept?

What constitutes minutes?

Answer 1

CA2006 makes no provision to allow this, but MA 17 & 18 (plc) and 8 (Ltd) = a resolution signed by all the directors entitled to attend a board meeting is as valid and effectual as if passed at a board meeting

MA. 18 (plc) and 15 (ltd) Ltd = copies of director unanimous or majority decisions must be retained for at least 10 years = includes written resolutions

CA2006 and Articles are silent = for each company to decide style, format and content of minutes

Question 2

Content requirements of minutes are not set out in CA2006 or Articles, but what are the 7 static data items that are generally agreed should be included as best practice for minutes?

Is it acceptable for minutes of members and directors to simply record decisions?

Answer 2

1. Company name and RO
2. Place, date, and time of meeting
3. Attendees (directors’ meetings not members’ meetings)
4. Identity of Chairperson
5. Confirmation of quorum present
6. Declaration of specific conflicts of interest in matters to be discussed (directors’ meetings not members’)
7. Time meeting closes

No = the reasoning behind decisions must be recorded also, to provide context for those not at the meeting

Question 3

What are the 6 Cs of good communication that should be used as a useful guide to keep in mind when preparing and reviewing draft minutes?

Answer 3

1. Clarity
   * Minutes should be clear and unambiguous
   * Language of minutes should be calm and neutral
2. Coherence
   * Minutes should be written logically with all ancillary points linked to the main topic
3. Conciseness (concise record of the meeting)
   * Nothing material should be omitted but no padding or repeating = will what was said add anything to the reader in a month/year/more? If no, leave out
4. Consistency
   * Consistent tone, flow, and style across all minutes = easier to read and understand in the context of previous/subsequent meetings
5. Completeness
   * Each section should be complete showing the discussion and decision reached
6. Correctness
   * Should be correct in terms of language, technical terms, grammar, and spelling = easier to understand

Question 4

Companies are occasionally asked to prove that they exist and that directors or others have due authority to undertake certain specific actions, but who can certify extracts as true copies from the minutes?

What does the minute book of any company provide? (2)

Answer 4

The company secretary

1. a historical record of significant events and decisions in a company’s development over the years
2. the only long-term first-hand account of what took place at meetings (as directors and company secretaries change over time)

Question 5

Why is it important for the minutes to reflect not only the actions of the board but the context?

Why will the style and detail of minutes be influenced by the business and sector of an organisation?

Where action points are recorded at a meeting, it is useful to do what?

Answer 5

= so that there is no uncertainty that the meeting was done properly and directors discharged their s.172 duty (to act in the best interests of the members with due regard to other stakeholders)

Some companies are required to provide a ‘S.172 statement’ in ARA and larger companies must report on their engagement and how they have had regard to interests of various stakeholders = minutes can be used as evidence

keep a record of these separately, including detail of the person the action had been assigned to and the target completion date, if known = schedule can then be circulated to those tasked with any actions

Question 6

Do minutes of directors’ meetings have evidential status?

Do directors’ written resolutions have evidential status?

Do minutes of members’ meetings have evidential status?

Do members’ written resolutions or resolutions passed otherwise than at a GM have evidential status?

What does evidential status mean? (3)

What happens if the minutes are not properly authenticated or kept?

Answer 6

Yes = S.249 CA2006 = minutes of meetings recorded and retained in accordance with s.248 AND signed by the chair as a correct record are evidence of the proceedings of the meeting

No = there are no provisions in the CA2006 specifically authorising the directors to make use of written resolutions

Yes = S.356 CA2006 = minutes of general meetings signed by the chair as a correct record are evidence of the proceedings of the meeting

Yes = S.356 CA2006 = written resolutions signed by the chair as a correct record are evidence of the proceedings of the meeting

Such minutes, unless there is evidence to the contrary, indicate that:
1. the meeting they relate to is deemed duly held and convened;
2. all proceedings at the meeting are deemed to have taken place; and
3. all appointments made at the meeting are deemed valid

No evidential status = demonstrated in POW Services v Clare (1995) when minutes were not entered in minute book

Question 7

For meetings held after 1 October 2007, how long must the minutes of directors’ and members’ meeting be kept for?

For meetings held before 1 October 2007, how long must the minutes of directors’ and members’ meeting be kept for?

If an error comes to light after the minutes have been signed, what is the procedure?

Answer 7

S.248 and 355 CA2006 = 10 years

Rules of CA1985 apply = minutes must be kept permanently

Signed minutes must stand = cannot change them!
In next meeting minutes, refer to previous minutes with error (e.g. item 2 paragraph 2) and make note of the amendment(s)

Question 8

What are the dangers of not keeping the minute book secure? (4)

Why is it generally not recommended that companies use loose-leaf minute books?

Answer 8

A. loss of confidentially
B. total loss
C. tampering, alteration, or falsification
D. authenticity of minutes can be called into question if not kept securely

A judge in 1936 observed that anyone wishing to do so can easily remove pages and insert replacement altered pages (if loose-leaf books are used extra security of their safe keeping should be applied to demonstrate that no one was able to tamper with the minutes)

Question 9

What are 5 variable data that may be included in the minute contents?

Answer 9

A. matters brought forward and action points from previous meeting(s);

B. review and approval for signature of minutes of the previous meeting;

C. synopsis of discussions on matters on agenda, actions points, decisions made; (most important)

D. matters to be carried forward and action points; and

E. any other business not on the agenda

Question 10

Name 4 safeguards that will provide security against tampering and falsification of the minutes.

Can members request a copy of the minutes of a general meeting?

Answer 10

1. Sequential numbering of all paragraphs
2. chair to sign the last page and initial every other page
3. Keep hard copy minutes in a lockable, fireproof filing cabinet, with restricted access
4. Keep electronic minutes on a secure board portal or restricted network drive with limited access

Yes and must be given within 14 days