Meeting Sharp v Dawes Meeting is “… a coming together of more than one person”

1. Meeting Sharp v Dawes Meeting is “… a coming together of more than one person” h/ever in some circumstances meeting of one person also constitutes a meeting: i- where all the shares of the particular class are held by one member, that member alone may constitute a meeting of members of that class of share [East v Bennet Bros Ltd]

2. ii- one creditor has proved his debt in a bankruptcy proceeding, if the creditor is the only creditor entitled to vote, he alone constitutes a valid meeting of creditors. [Re Thomas; ex parte Warner] iii- section 150 – when it is impracticable to held the meeting in the manner prescribed by the CA or the AOA – meeting of one person by the order of the court constitutes a valid meeting [ e.g. when A meeting required all members as quorum but there were only two members and one had always avoided meeting]

3. iv- where quorum is determined by the percentage of share value and not physical presence, individual who owns the prescribed share value or more will sufficient to constitute a quorum in a Meeting v- where the BOD had delegated its duty to a committee, if the committee consists of one member, and it is allowed by the AOA it can hold a meeting with one attendee. [Re Taurine Co]

4. Fireproof doors Ltd , Umney v Fireproof Doors Ltd Herbert Williams Umney, the husband of the pltf, and Mr Schwarze were appointed to be directors of the company, and they were the only directors of the company from 19/1/1908, until 2/5/1912, when Mr Wright was appointed an additional director. Article 91 "The directors may delegate any of their powers to committees consisting of such member or members of their body as they think fit; any committee so formed shall in the exercise of the powers so delegated conform to any regulations that may be imposed on them by the directors”

5. H W Umney alone acting as a committee purported to authorise the issue and the sealing of the debentures, which included the five debentures held by the plaintiff. The seal was affixed to such debentures in the presence of H W Umney and the secretary of the company only. They were signed by H W Umney and the secretary only Q: whether, the issue and sealing of the twenty-six debentures were duly authorised?

6. Held: it is clear on the authorities that under art. 91 directors may delegate their powers to one of their number, and the power was sufficiently delegated to Umney. Types of meeting i- statutory meeting ii- annual general meeting (AGM) iii-extraordinary general meeting (EGM) S145A meeting of the company must be held in in state where its registered office is located.

7. i- Statutory meeting Must be held by public company limited by shares. Purpose: discuss matters relate to the incorporation of the company S 142 (1) public company ltd by shares must hold the meeting w/in a period of ≥1 ≤ 3 months after the date it is entitled to commence business- see s 52(2) & (3)

8. The process: i- s 142(2) directors send statutory reports to members – at least 7 days before the date of the meeting S 142 (3) Contents: total allotted shares – paid up or partly paid up o/wise than in cash, the consideration for the allotment, total amount of cash received in return for shares allotment, etc The report must be certified by at least 2 directors

9. ii- s 142 (6) directors must produce lists showing the names and addresses of the members and the number of shares held by them respectively at the commence of the meeting – open and accessible during the meeting iii- Directors must lodge a copy of the report with the Registrar at least 7 days before the date of the meeting Meeting cannot pass any resolution if notice in accordance with the AOA was not given. Pls see Table A Sch 4, Art 45, s 152

10. S 142 (10)- penalty for non compliance - every officer of the company who is in default and every director who fails to take all reasonable steps to secure compliance with this section shall be guilty of an offence. Penalty: RM5,000 and Default penalty: RM100. S 218(1)(b) The Court may order the winding up if the company fail to lodge the statutory report or to hold the statutory meeting

11. ii-Annual General Meeting S 143(1)- Every company. a) Must hold AGM in every calendar year. b) Subsequent AGM must be held w/in 15 months after the last AGM. Calendar year begins 1st January ends 31st December The 1st AGM can be done w/in 18 months of its incorporation.

12. Hence, the 1st AGM need not be held in the year of its incorporation or the following year. e.g. incorporated 1/11/07. 1/11/07 – 30/10/08 = 12 months 1/11/08 – 30/4/09 = 6 months 1st AGM held on 15/4/2009 - w/in 18 months. No default, not an offence Subsequent AGM w/in 15 months = 30 / 7/ 2010

13. Business at the AGM i- s129(6) re-appoint a director of public company or its subsidiary whose age beyond 70 requires resolution pass at the AGM; ii- s 134(1) company must produce its register of directors’ shareholding at the commencement of each AGM and keep it open and accessible during the meeting; iii- s 169 (1) & (3) – directors must lay before the AGM the loss and profit account and the balance sheet.

14. iv- s 172(2) appointment of auditor/ Failure of the company to hold AGM as required: i- not holding the AGM w/in calendar year; ii- not holding the subsequent meeting w/in the specific period s 143(3)(a) the company and every officer of the company who is in default shall be guilty of an offence against this Act. Penalty: Five thousand ringgit & Default penalty: One hundred ringgit

15. Failure of the company to hold an AGM gives the members the right to apply to the court to order an AGM. S 143(2) H/ever, the ROC/CCM may extend the period of AGM upon an application by the Company. The company may appeal if the ROC refuse the extension of time. [s 10(110] The application must be made with the Directors resolution to that effect and Form 51A [ Reg10A of the Companies Regulations 1966]

16. Application for extension must be made before the calendar year or the period of 15/ 18 months has expired. [Reg. 10A(2) of the Companies Regulations 1966] iii- Extraordinary General Meeting (EGM) Art 43 Table A Sch 4, EGM refers to the meeting of the company other than an AGM Convened by directors, at the requisition of members or by the members

17. i- Art 4 Table A- Any director may whenever he thinks fit convene an extraordinary general meeting Pergamon Press Ltd v Maxwell The power of director to call a meeting was a fiduciary one wh must be exercised in good faith and in the best interests of the company

18. ii- Requisition of EGM by members If the directors honestly believed- not in the interest of the company – need not hold an EGM. H/ever, Art 44 Table A Sch 4 members may requisite an EGM Who may make the requisition? S 144 – a) members holding at the date of the deposit of the requisition ≥10 per cent of the paid-up capital wh carries the right of voting at general meetings; or

19. b) In company w/out share capital - members representing ≥10 per cent of the total voting rights of all members having at that date a right to vote at general meetings. e.g. notice of requisition for EGM <http://www.ipsofactoj.com/highcourt/2003/ Part3/hct2003(3)-009.htm>

20. The director must convene the meeting w/in 2 months fr the date of the requisition. Failure of directors to hold the meeting – allow any of the requisitionists to convene the meeting themselves provided they have more than one-half (1/2)of the total voting rights of all of them. h/ever, the requistionists need not wait for 2 months. wait for 21 days if no meeting was convened by directors they themselves can convene the EGM The meeting convene by the requisitionist must be held w/in 3 months fr the date of the requisition s 144(3).

21. SJA Bhd vsHLB Nominees (Tempatan) Sdn Bhd 22/4/02 – requisition for EGM was made 21 days passed – directors failed to convene the EGM according to s 144(1) 9/7/02 – notice to call the EGM was issued by the Def. The meeting was to be held on 7/8/02. s. 144(3) Plf filed the petition to stop the meeting saying that it was beyond the time prescribed in s 144(3)

22. Held- the proper construction of s 144(3) of the Companies Act 1965 is that the time for calculating the 3 months for convening the relevant EGM stipulated in the section runs from the date of the deposit of the relevant requisition. Accordingly, notice dated 9/7/02, indicating the Def's intention to hold an EGM of the Plf on 7/8/02, 2002 is in contravention of the time limit stipulated in S 144(3) and is therefore null and void

23. Notice of meeting S 145(2) notice of a meeting, other than for passing a special resolution must be sent not less than 14 days or any period provided in the AOA. S 145 (3) This notice can be shorten: i- in the AGM if agreed all the members entitled to attend and vote; or ii- in other meetings, agreed by a majority which holds ≥ 95 per centum in nominal value of the shares giving a right to attend and vote / in case of company w/out share capital – agreed by members represents ≥ 95 per centum of the total voting rights

24. S 152 (1) - to pass a special resolution – notice of at least 21 days before the meeting S 152 (2) -This notice can also be shorten with the agreement of members [see previous slide point (ii)] First Nominee (Pte) Ltd vs New Kok Ann Realty Sdn Bhd Company issued 25,000 shares. The applicant held 12,859 shares, the majority shares, and another party held 12,139 shares.

25. Company decided to issue new shares. A general meeting was held and it passed a resolution to increase the capital of the company by another $100,000 in 1,000 shares of $100 each. the applicant was purported to have been allotted with 510 new shares and the second respondent with the remaining 490 shares. Applicant failed to subscribe the shares offered. The company forfeited the shares and reallocated them to the other s/holder wh became a majority s/holder.

26. Applicant argued that it was not given the notice of the meeting and accordingly it was not represented at the meeting. The notice was sent 11 days before the meeting was held and in that event the notice was 3 days short of the length of service required by the MOA and AOA of the Company which specified 14 days notice.

27. Held- that the absence of a proper notice to the applicant both in regard to the general meeting as well as the forfeiture of the purported new shares allotted to it, has substantially prejudiced its position in the company as a majority shareholder. This has caused injustice to the applicant. Based on an Australian decision on a similar provision in the Australian Companies Act the court stated it will strictly construe the provision particularly where the irregularity involves a derogation from the rights of a person before

28. allowing the section to operate, in order to validate the defective proceedings of the company. In exercising its discretion it is for the court to satisfy itself that any such order would not do injustice to the company or to any member or creditor thereof.

29. Effect of failure to give notice See s. 145 (4) and Arts 108 -111 Table A Sch 4 Common law – might invalidate the proceeding at the meeting. Young v Ladies Imperial Club A member was not given a notice of the meeting because she had wished not to be troubled to attend the meeting.

30. It was held that a notice should have been given to her and that a resolution passed at the meeting was invalid. H/ever, if despite the failure to give notice all members attended the meeting and consciously make the decision, the resolution will be valid. Now s. 145(5) – accidental omission to give notice will not invalidate proceeding at the meeting but not deliberate omission.

31. The manner of giving the notice depends on the AOA. Failure to follow the AOA – may become inadequate. Re West Canadian Collieries Ltd Unintentional omission of some address plates when notices were being prepared did not invalidate proceeding at the meeting Virtual meeting http://kirra.austlii.edu.au/au/journals/MULR/2004/9.html

32. Contents of notice Purpose to inform/ to notify. Must contain material which is substantially full and true to enable members to decide whether it is worthwhile to attend the meeting. Baillie v Oriental Telephone & Electric Co Ltd “Bad notice is one wh is not frank, not open, not clear and not in anyway satisfactory”

33. Failure to give adequate information – invalid meeting and resolution- action following the resolution – unlawful How to assess the adequacy of the notice? Killen v Marra Developments Ltd The test is whether ordinary person in business who scan and read the notice quickly would make a reasonably informed judgment whether to attend the meeting.

34. In other word “what is the meaning wh this notice would fairly carry to the ordinary minds” See Art 45 Table A Sch 4: Day, date, place hour, and also in case of special business (matter) the nature of the business (matter) Hup Seng Co ltd v Chin Yin & ors Failure to specify the special matter/business – meeting may have no legal effect- void meeting and proceedings.

35. S 153 - If the resolution required special notice – notice of 28 days is required. Special notice for the following resolution i- to remove directo of a public company [s 122]; ii- to remove auditor of the company [172(4); and iii- To remove liquidator in members voluntary winding up. [s258(3)

36. Quorum AOA – usually fixed the quorum. Resolution passed in a meeting w/out necessary quorum – void See Art 47, Table A sch 4. s. 147(1)(a) – if the AOA does not fix the quorum – it shall be 2 members personally present. Proxy cannot be counted as a quorum. AOA usually provides whether the quorum should be present through out the meeting or necessary at the commencement of the meeting only.

37. H/ever, the members left in the meeting cannot be less than 2. Re London Flats Ltd A company went into member voluntary liquidation. A liquidator was appointed but passed away. EGM was held to appoint new liquidator. Resp. and Appl. Were only two members who can attend and vote. Resp. declared himself as c/man. Appl proposed L as new liquidator. Resp. amended the proposal to

38. propose himself as liquidator. Appl. left the meeting room before the proposal was made. The amendment to the proposal was supported by one vote. Q- was Resp. validly appointed as liquidator? Was there sufficient quorum? Held- no meeting because one shareholder cannot constitute a meeting. The appointment was null.

39. If the AOA provides that at least two members personally attend the meeting as a quorum – proxy will not be counted as quorum. Even if the one member acts as himself and as a proxy. Re Salvage Engineers K and R the only two members of the company. They were also directors of the company. R left the country for Europe and appointed K as his proxy to vote in an EGM in favour of a resolution to voluntarily wind up the company. EGM was convened. K attended as himself and as proxy to R

40. The resolution was passed. AOA provides that quorum shall be 2 members present in person or by proxy and entitled to vote. R changed his mind and wanted the company to continue. He challenged the validity of the resolution. Held- one man meeting could not constitute a proper quorum

41. Voting S 148(1) every member has a right to attend any general meeting of the company, to speak and to vote on any resolution. Unless: i- AOA prevents members who have not paid for their shares from attending the meeting [s 148(1), art 57] ii- Preference shareholders’ right to attend and vote in the meeting may be suspended subject to the AOA. [ s 148(2)

42. Table A rights of joint shareholders: Seniority ( based on the order of name in the register of members) and sound mind How about person declared bankrupt?

43. Manner / method of Voting By show of hands/ by poll Look into the AOA art 51, art 54, s 147(1), s 149(1)(a) Art 53 allows c/man to cast vote in case an equality of vote.

44. Proxy S 149 Member can appoint the most 2 proxies in one meeting. If appointed 2 proxies must specify the voting rights represent by each proxy. Proxy can be members, advocate, company auditor or anyone approved by the ROC. The qualification must exists from the appointment to the time of action

45. AOA cannot disallowed the appointment of non- members as proxies. Lim Hean pin v Thean Seng Co Sdn Bhd & Co Art 51 of the AOA disallowed members from appointing non-member as proxy. An advocate appointed as a proxy was excluded fr an AGM. Held- art 51 wh sought to contract out of s 149(1) was void and of no effect.

46. Notice of meeting must inform members of their right to appoint proxy and also the fact that proxy need not be members. See art 61 Table A Sch 4. AOA fixed time for depositing proxy form with the company. h/ever s 146(1) provides that a requirement in the AOA that the proxy form must be deposited more than 48 hours before the meeting in order to be a valid appointment is void

47. If the proxy form require attestation by witness, the attestation cannot be by the party to the Appointment. Lee Eng Hock & Malays Siamese Prospecting Co Ltd it was held that a proxy form attested by the proxy’s substitute was invalid Appointment of proxy can be revoked. If appointed for a specific purpose, revocation took place upon completion of the purpose. Revocation can be done anytime before the power is exercised unless it is an irrevocable appointment.

48. If the member himself present in the meeting and vote – revocation of proxy’s authority. Cousins 1st plf was appointed as proxy representing 101,138 votes to vote in favour of the election of Carr as director. Meeting was adjourned to Another for the poll to be taken place. Before the adjourned meeting took place, certain members who had earlier appointed the 1st plf revoked his authority. They attended the meeting and voted against the appointment of Carr.

49. The c/man rejected the proxy’s votes. Held – implied condition in the appointment of proxy that he has authority to act according to the instruction of the person who appointed him. Hence, when the member himself attended the meeting and voted, thus creating a double vote in respect of the same shares, the c/mas has a duty to reject the vote of the proxy as the personal vote is an unequivocal exercise on the part of the s/holder of his option to vote in person.

50. If the member attended the meeting but did not vote, or voted on certain matters but did not in some matters, it will not necessarily revoked the authority of proxy. In case of corporation – it can appoint a representative by a resolution of directors / membes / creditors