Notice of General Meeting Called by Shareholders

Companies rely on meetings to arrive at decisions. A general meeting is a meeting of the company's shareholders, as opposed to a meeting of its directors. Ultimately, the shareholders control the destiny of their companies, as they usually have the right of appointment and removal of directors at general meetings.

Shareholders make decisions broadly on matters outside the area of management of the company. Resolutions of a general meeting directing the board to exercise its powers in a particular way are invalid. The general meeting may also exercise certain corporate powers where the board is incapacitated, such as where the directors have a conflict of interest.

Legal Issues regarding a Notice of General Meeting Called by Shareholders

According to section 249D of the Corporations Act 2001 (Cth) (Act), directors must call a general meeting when requested by members with at least 5% of the votes that may be cast at the general meeting. The directors must call the meeting within 21 days of the request received by the company.

If the meeting is to be held in two or more places, then the notice must set out the technology that will be used to facilitate this, see section 249L(a) of the Act.

To be effective, the request must:

• be in writing;

• state any resolution to be proposed at the meeting;

• be signed by the members making the request; and

• be given to the company.

According to section 249H of the Act, the shareholders entitled to attend and vote at a general meeting must be provided with at least 21 days’ notice of the upcoming meeting, unless the shareholders agree otherwise. The company’s constitution may specify a longer minimum period. Shareholders of a proprietary company are only entitled to appoint proxies if the company’s constitution permits it or if replaceable rule section 249X of the Act applies to the company. Proxy details, if any, should be included in the notice. The notice must be signed by one of the directors of the company or its secretary.

For a notice of general meeting called by the board not in response to such a request, see Notice of General Meeting.