1. CHAPTER VII: MEETINGS
A meeting is an assembly of people for lawful purpose or the coming together of at least two
persons for the same reason. A company meeting is a coming together of at least a quorum of
members in order to transact either the ordinary or special business of the company.
In Sharp vs. Dawes (1876) 2 Q.B.D. 26 a meeting was defined as an assembly of people for a
lawful purpose or the coming together of at least two persons for any lawful purpose. Meetings
are divided into two types: -
a) Public meetings
These are meetings open to all members of the public and which consider matters of public
concern.
b) Private
These are meetings attended by people who have a specific right or special capacity to attend.
Importance of company meetings
It is in meetings that important matters relating to the business of the company are decided.
Shareholders meetings are also important as they help them look after their interests by
exercising powers conferred on them by statute. There are also certain matters that can be
decided only by shareholders.
Classification of company meeting
Company meetings are classified as below: -
1. Meetings of shareholders.
a) Statutory meetings
b) Annual general meetings
c) Extra - ordinary general meetings
d) Class meetings
2. Meetings of directors
a) Meetings of the board of directors
b) Meeting of committees of directors
3. Meetings of debenture holders
4. Meetings of creditors.
5. Meetings of creditors and contributories on winding up of the company.
1. Meeting of Shareholders-General Meetings
2. a) Statutory meeting
This is the first meeting of a public company. Every company limited by shares and every
company limited by guarantee and having a share capital shall within a period of not less than
three months from the date on which the company is entitled to commence business; hold a
general meeting of members of the company which shall be called the statutory meeting.
The purpose is to accord members an opportunity to discuss matters relating to the formation of
the company or matters arising out of the statutory report, whether previous notice has been
given or not.
Statutory report
This is a report sent to all members at least fourteen days before the statutory meeting. If all the
members entitled to attend and vote agree the report can be forwarded in less than fourteen days
to the meeting.
Contents of the statutory report: -
a) Total shares allotted distinguishing shares allotted as fully or partly paid up.
b) Cash received in respect of shares allotted.
c) Abstract of receipts and payments of the company made up to date without the seven
days of the reports.
d) Directors and auditors - the names, address and occupation of the directors, auditors and
managers and secretary and changes, which have occurred in such names, address, and
occupations.
e) Contracts - the particulars of any contract the modification of which is to be submitted
to the meeting for approval, together with the particulars of the modification or proposed
modification.
Section 130(8) provides that the meeting may adjourn from time to time and at any adjourned
meeting a resolution can be passed after due notice in accordance with articles.
Default
If default is made as regards to holding of the statutory meeting and delivering the statutory
report a ground for petition for winding up order against the company is created. In usual
practice courts order such meetings to be held and reports delivered at the cost of persons in
default. The person in default is also liable to a fine of up to one thousand shillings.
3. b) Annual general meetings
These are meetings held annually and the interval between one meeting and the next one shall be
not more than fifteen months. A company however may hold its first annual general meeting
within a period of eighteen months from the date of corporation.
The registrar may for any special reason, extend the time for holding any annual general meeting
by a given period of time. No extension of time is granted for holding the first annual general
meeting. In case of default a member may apply to the registrar of companies to call or direct the
calling of such meeting. If default is made in holding the annual general meeting in year one the
annual general meeting held in year two is treated as an annual general meeting for the year one.
Default to holding the annual general meeting, renders the company and its officers in default to
a fine up to two thousand shillings.
Requirement of notice
Section 133 provides the minimum notice required for company meetings as follows: -
a) In the case of a meeting, 21 days notice in writing.
b) In the case of a meeting then an annual general meeting for passing a special resolution,
14 days in writing and 7 days notice for an unlimited company.
Ordinary business of the annual general meeting
The objects depend on the articles, but article 52 of table A provides that the ordinary business
of an annual general meeting shall be: -
a) Consideration of dividend
b) Consideration of accounts
c) Election of directors to replace the retiring
d) Appointment of and fixing the remuneration of auditors.
Although appointment of auditors must be made by the company in the general meeting they
are made by the company in the general meeting they are automatically re-elected, provided
they are qualified, without any resolution to that effect, unless;
a) They have resigned.
b) They are unwilling
c) A resolution has been passed expressly providing that they shall not be re-appointed.
c) Extra ordinary general meeting
4. These are called for transacting some special business, which may not be postponed till the next
annual general meeting. All meetings other than the annual general meeting and statutory
meeting are called extra ordinary general meeting.
The extra ordinary general meeting may be convened;
a) By the board of directors on its own or on the requisition of the members.
b) By the requisitions on failure of the board of directors. Extra ordinary meeting convened
the board of directors.
a) On its own
Board of directors may call an extraordinary general meeting to allow members decide on
matters that cannot be postponed to the next annual general meeting.
b) On requisition of the members
The required number of members of a company may also as for an extraordinary general. The
requisition for such a meeting by the members shall be signed.
a) In the case of a company having share capital holders if not less than one tenth of the paid up
capital of the company.
b) In the case of a company not having a share capital, by members representing not less than
one tenth of the total voting power in regard to the matter in requisition.
The directors are required by section 132 to convene such a meeting within twenty-one days
from the date of the requisition and if they fail to do so, the requisitioners may convene the
meeting. The company must compensate the requisitioners for any reasonable expenses incurred.
c) Class meetings
These are called when the company's share capital is divided into different classes of shares.
These meetings are required when it is proposed to alter, vary or affect the rights of a particular
class of shares.
A class meeting should be attended only by members of the class. A class meeting can include
strangers if there is no objection to their presence by a member of the class.
The rights of a particular class of shares may be varied with the consent in writing of the holders
of three fourths of the issued shares of that class.
Rights of minority
Section 74 stipulates that the holders of not less than 15% of the issued shares of that class being
persons, who did not consent to the resolution, abstained or did not vote all may object within
5. thirty days to the alteration approved by the majority of the class. The court must disallow the
variation if it is satisfied that it would unfairly prejudice the shareholders of the class, but if not
satisfied, it will confirm the variation.
2. (a) Meetings of the board of directors
These are the most frequent meetings of the company. These meetings discuss matters of the
company and decide on policy issues concerning the company.
(b) Meetings of committees of directors
Committees are common in large companies where it is convenient to delegate certain matters.
Delegation to committees can only be allowed if the articles so provided. Committees may be
standing or ad hoc committees.
3. Meetings of debenture holders
These meetings are held in accordance with the rules and regulations that are either entered in the
trust deed or endorsed on the debenture bond and are binding on the company and the debenture
holders.
These meetings are called wherever the interests of the debentures are involved as in
reconstruction, reorganizations, amalgamation and winding up. The rules and regulations entered
in the trust deed relate to notice of meeting, appointment of a chairman and the writing and
signing of minutes.
4. Meeting of creditors
These are called when the company proposes to make a scheme or arrangement with its creditors.
5. Meeting of creditors and contributions on winding up
These are held when the company has gone into liquidation. These are called to ascertain the
indebt ness of the company to its creditors and also to appoint either a liquidator or a committee
of inspection.
Requisites of a valid meeting
The following are requirements for a valid meeting: -
6. 1. The meeting must be duly commenced by a proper authority.
2. A proper notice must be served in the prescribed manner.
3. A quorum must be present.
4. A chairman must preside.
5. Minutes of proceedings must be kept.