CHAPTER 7 -MEETING
Salmiah Salleh
Company Meeting/SS 1
Outline
Introduction
Types of Meeting
Notice
Conduct/proceeding of meeting:
◼ Quorum
◼ Chairing Meeting
◼ Voting
◼ Proxies
◼ Resolutions
◼ Records of resolution and meeting
◼ Irregularities
Company Meeting/SS 2
Introduction
Discussion in meeting is one of the best practical expression of
the democratic way of life.
The New Shorter Oxford Dictionary (1993) defines the meaning
of ‘meeting’ as:
◼ “A private or public gathering or assembly of people for
entertainment, discussion, legislation, etc;… the action or an
act of coming together, encountering, assembling…”.
The Oxford Companion to Law (1980) defines ‘meeting’ as:
◼ “ a gathering of 2 or more persons called to receive a report,
take a decision or otherwise take some lawful action”.
Lord Coleridge CJ in the case of Sharp v Dawes(1876) 2 QBD
26, CA held, the word ‘meeting’ prima facie means:
◼ “a coming together of more than one person”.
Company Meeting/SS 3
Introduction
From the definition of meeting, generally it
requires a plurality of persons i.e. 2 or more.
However in certain circumstances a singular
person may constitute a valid meeting (Sharp v
Dawes). These include:
◼ Where all the shares of a particular class in a company
are held by one member, that member alone may
constitute a meeting of members of that class (East v
Bennet Bros Ltd. [1911] 1 Ch 163.).
◼ Where one creditor has prove his debt in a bankruptcy
proceeding and there is only one creditor entitled to
vote, he alone may constitute a valid meeting of the
creditors (Re Thomas; ex parte Warner [1911] WN 123).
Company Meeting/SS 4
The CA 2016 recognizes one person company.
S344 – the sole member may either
◼ Pass a written resolution; or
◼ Provides the company with details of his decision.
This would be equal to decision taken and agreed by
the company in a meeting of members.
Company Meeting/SS 5
Single person => valid meeting (cont…)
◼ Where the directors of a company delegate their
authority to a committee, it appears that there is
nothing to prevent a committee of one director
being appointed if the articles so allow (Re
Taurine Co (1883) 25 Ch D 118, CA.
◼ Where in ordering a meeting pursuant to s 314,
the court can make a discretion that a quorum of
one member be constituted.
◼ Where the relevant criterion in determining the
quorum is the percentage of the share value
and not the physical person present. An
individual shareholder who owns the prescribed
share value or more will be sufficient to
constituted a quorum (Isetan(S’pore) Ltd v
Wisma Development Pte Ltd & Anor {1993} 1
SLR 997, CA.).
Company Meeting/SS 6
TYPES OF MEETING
Types of
Meeting
Meeting of
Annual general
members
meeting
(public or
(Only for public
private
company)
company)
Company Meeting/SS 7
AGM
S340- requires only public company to hold AGM at least once
in every calendar year to transact:
◼ The laying of audited financial statement and the reports of the
directors and auditor;
◼ The election of directors;
◼ The appointment and the fixing of the fee of directors.
AGM must be held:
◼ Within 6 months of the company’s financial year end; and
◼ Not more than 15 months after the last preceding GM
S340(3) –If the company hold its 1st AGM within 18 months
after its incorporation, it is not necessary for the company to
hold AGM in that year or the
Company following year.
Meeting/SS 8
Effect of failure to hold AGM
The company and the defaulting officers is committing
an offence.
Penalty : Fine of RM20,000
S340(5) – if the company fails to convene an AGM,, the
court may, on application by any members, order that a
GM be convened.
Company Meeting/SS 9
AGM
Is the only meeting of member that company must hold.
Members can get information and can question the directors on
the operation and affairs of the company.
Among the power of AGM:
◼ Rights to remove directors
◼ To meet and pass resolutions
◼ May transact any other business allowed by the CA
Company Meeting/SS 10
EGM / MOM (Meeting of members)
Is a meeting of members other than AGM.
The term EGM is not used in the CA 2016. instead it uses MOM.
The agenda of MOM- usually constitute special business, which
are urgent and cannot be delayed until the next AGM.
Apply to both public and private company
Who may call MOM? – s 310
◼ Board
◼ Members holding at least 10% of the issued share capital or lower
percentage prescribed in the constitution or if the has no share capital
by at least 5% of the number of members.
◼ Court order(s314)
Company Meeting/SS 11
MOM (cont…)
S 311- enables members to requisition in writing to the directors
for the convening of a MOM in the following situations:
◼ Where a co has a s/capital –by members holding at least 10% of the
paid up share capital carrying voting rights; and
◼ If the co has no s/capital – by members representing at least 5% of the
total voting rights.
Company Meeting/SS 12
MOM (cont…)
S 312(1) –
◼ (a) upon requisition, the director must convene a MOM
within 14 days; and
◼ (b) the meeting is to be held not later than 28 days after the
date of the notice to convene the meeting.
S312(2) – if the request identify a resolution intended to
be moved at the meeting, the notice must include the
text of the resolution.
Company Meeting/SS 13
MOM (cont…)
S313– if the directors fail to convene a MOM, the requisitioning
members may themselves convene the meeting.
That MOM must be held on the date not more than 3 months after the
date which the director received the requisition.
SJA Bhd v HLB Nominees Sdn. Bhd [2002] 4 MLJ 574 – the 3 months
allowed under s144(3) runs from the date of deposit of the requisition
and not from the expiry of 21 days of the date of deposit.
S313(6) imposes duty on the company to pay reasonable expenses
incurred by the requisitioning members.
S313(7) – any sum so paid by the company shall be out of any sums
due…by way of fees or other remuneration in respect of services of
the director as who were in default.
Company Meeting/SS 14
NOTICE OF MEETING
Purpose – to enables members to know what is to be done at the
meeting, so that they can decide whether to attend or not and how to
vote.
To whom? s321
◼ Every member
◼ Director
◼ Auditor.
Any failure to give notice - the meeting may be held to be void . The
proceeding at the meeting, therefore, void. Unless it is an accidental
omission.(s316(6))
Company Meeting/SS 15
Musselwhite v Musselwhite (1962)
Some members had executed transfer of their shares in
favour of third parties but had yet to be transferred.
Though their names remained in the register, the
company did not give them notice of meeting under the
impression that they were not entitled.
Held this is an intentional omission to give notice. Thus,
the meeting was held to be void.
Company Meeting/SS 16
Re West Canadian Collieries Ltd(1962)
Failure to give notice of a meeting to 9 members was
due to an administrative error.
Held – it was an accidental omission and thus, the
omission did not invalidate the meeting.
Company Meeting/SS 17
Period of notice
S316(1) – a MOM of a private company, other than for passing
special resolution, requires at least 14 days notice or longer as
allowed by constitution.
S316(2) – for public company, other than for passing special
resolution, requires:
◼ In case of AGM, at least 21 days notice or longer as provided
by constitution; and
◼ In any other case, at least 14 days or longer as specified in
the constitution.
S 316(3) – shorter notice if agreed by members.
Effect of insufficient notice – the proceeding at the meeting were
invalid (First Nominee Ltd v New Kok Ann Realty Sdn Bhd.
The CA 2016 allows members to waive the short notice.
Company Meeting/SS 18
Special notice
In certain circumstances the CA requires ‘special
notice’ of a resolution.
‘Special notice’ means at least 28 days’ notice to the
company or at least 14 days when notice is given by
the co – s322
Special notice required to remove an auditor (s 277(1)),
or to remove a director of a public company (s 206(3)).
Company Meeting/SS 19
Content of notice – s317
Must include the following:
◼ Place, date and time of the meeting, and
◼ the general nature of the business to be transacted.
May include text of any proposed resolution and other
information the directors deem fit.
Company Meeting/SS 20
Forms of notice – s 319
Partly in hard
copy and
In electronic
In hard copy partly in
form
electronic
form.
Company Meeting/SS 21
CONDUCT / PROCEEDING OF
MEETING
Venue A valid GM is one which is
properly convened, properly
Quorum constituted and properly
conducted.
Chairing Meeting
Voting
Proxies
Resolutions
Records of resolution and meeting
Irregularities
Company Meeting/SS 22
Venue – s 327
Allows company to hold meeting at more than one
venue using any technology or method that enables the
members to participate and to exercise to members’
rights to speak and vote at the meeting.
The main venue shall be in Malaysia, the chairperson
must be at the main venue.
Company Meeting/SS 23
Quorum – s 328
Quorum is the minimum number of members who must
present for a meeting to validly transact business.
Quorum?
◼ One man company – one member personally present(s
328(1)
◼ Other case – 2 members personally present or proxy or
more as specified in constitution.(s328(2)
Generally, a resolution passed by a meeting will be
void if at the time of passing the resolution a quorum is
not present. (United Investment & Finance Ltd v tee
Chin Yong [1967] 1 MLJ 31).
Company Meeting/SS 24
Sum Hong Kum v Li Pin Furniture Industries Pte
Ltd [1996] 2 SLR 488
The P was removed as a director at a meeting without
the proper quorum.
Held – the meeting was invalid. The procedural
irregularities in the meeting caused substantial injustice
to the P and could not be validated.
Company Meeting/SS 25
When quorum required?
At the commencement of the meeting? or at the time
business is transacted? Or throughout the meeting up
to its conclusion?
S328(4) – no business shall be transacted at any
meeting of members unless a quorum is present at the
time when the meeting proceed to business.
Company Meeting/SS 26
Tan Guan Eng v BH Low Holdings Sdn. Bhd [1992] MLJ
105
The H/Court construed the relevant article to mean that
a quorum was required only at the time when the
meeting proceeded to business.
Given that there was a quorum when business
commenced, the continued meeting, with the presence
of only the holder of a valid proxy, was a valid meeting
and the resolution passed at the meeting was also
valid.
Company Meeting/SS 27
Tan Guan Eng v BH Low Holdings
Sdn. Bhd [1992] MLJ 105
An EGM was requisitioned and was subsequently convened
for the purpose of removing 2 persons as directors and
appointing 3 others in their place.
AOA: no business should be transacted at any GM unless a
quorum of members was present ‘at the time when the
meeting proceeds to business’. Again ’2 members must be
present’ to form a quorum.
The majority shareholder appointed Saw and Tan as his
proxies to attend the EGM.
At the commencement of the meeting, apart from Saw and
Tan, 3 other members were also present. One of those 3
presided as chairman of the meeting.
Company Meeting/SS 28
Tan Guan Eng v BH Low Holdings
Sdn. Bhd [1992] MLJ 105 (cont)
After the meeting was called to order, the meeting was
adjourned by the chairman and 3 members immediately left
the meeting.
Saw and Tan remained behind, proceeded with the meeting
and passed the desired resolution.
The judge found that the appointment of Tan as proxy was
invalid as he was not one of the 3 categories allowed under s
149(1)(b).
Therefore, effectively at the time when the desired resolution
was passed, Saw, a proxy, was the only person remaining at
the meeting.
Company Meeting/SS 29
Tan Guan Eng v BH Low Holdings
Sdn. Bhd [1992] MLJ 105 (cont)
Held: His Lordship considered Re Hartley
Baird, Sharp v Dawes and East v Bernett and
concluded that the desired resolution was a
valid one.
It was unfortunate that the case of Re London
Flats was not brought to the attention of the
learned judge. The cases referred to were
different as the departure was of one member
only which reduced the number to 9. The
quorum was 10.
Company Meeting/SS 30
Re London Flats Ltd [1969] 1 WLR 711;
[1969] 2 All ER 744.
Held:
The R’s purported appointment of himself as liquidator
was a nullity on the basis that at the time the resolution
was passed, only one member, i.e. the R, was present.
The other one had left the meeting.
Company Meeting/SS 31
s328(5)
Unless otherwise provided in the constitution, if a
quorum not present within ½ hour after the appointed
time of a requisitioned meeting, the meeting is
dissolved.
In other meeting – it is adjourned to the same day in the
next week at the same time and place or as determined
by the directors.
Company Meeting/SS 32
Chairing Meetings
To ensure the smooth running of the
proceeding at a meeting a person should
be appointed to chair it.
S329 – subject to constitution, chairman of
the board shall chair the meeting.
If no chairperson or the chairperson is not
present within 15 minutes or unwilling, the
members present must elect one of them
as chairperson.
Company Meeting/SS 33
Voting
The right to vote is an important right conferred upon
the members of a company. It cannot be forfeited
unless in accordance with law.
A shareholder owes no duty to anybody as to how he or
she will exercise their vote. He can vote as he pleases.
However 2 or more members may enter into a lawful
agreement (pooling agreement) on how to exercise the
voting right. In such a case, they may only vote in the
manner as agreed by them. Any breach of this
agreement, injunction may be imposed – Tuan Hj Ishak
bin Ismail v Leong Hup Holdings [1996] 1 MLJ 661
S 293(2) – member has no rights to vote if:
◼ Has not paid all calls or sum payable in respect of his shares
◼ Hold share with no voting right
Company Meeting/SS 34
How to vote?
By show
How to of hand
vote?
On poll
Company Meeting/SS 35
General rules on voting – s 293(1)
Unless otherwise provided in the constitution –
◼ For company having share capital –
On a written resolution – every member has 1 vote for each
share or stock held by him.
On a resolution on a show of hand – every member has I
vote.(regardless of his total shareholding in the company)
On a resolution on a poll - every member has 1 vote for each
share or stock held by him.
◼ For company not having share capital –
every member has 1 vote.
Company Meeting/SS 36
Therefore, voting on a poll and written resolution will be
more accurate expression of the wishes of the
members than by a show of hands (Ernest v Loma Gold
Mine Ltd.
Thus, a member holding a substantial number of shares
has more say in the matter.
Company Meeting/SS 37
vote on poll can be demanded by:
(s331(b))
1. At least 5 members having right to vote;
2. Member/s with at least 10% of total voting rights of all
members having right to vote; or
3. Member/s with at least 10% of paid up share capital
present.
Any provision in the constitution to the contrary(higher
number or percentage) is void.
S330(1)…contradiction with s 331(b).
Company Meeting/SS 38
Proxies
A proxy is a person authorised to attend and vote on behalf of the
appointing member at a meeting. He is a ‘lawfully constituted agent’
(Re English, Scottish & Australian Chartered Bank [1893] 3 Ch 385.
S 334(1) -Members who are entitled to attend and vote at a meeting
are entitled to appoint a proxy (whether a member or not) to attend
and vote in their place.
S334(2) – for a company having a share capital, a member may
appoint more than 1 proxy but the member must specify the
proportion of the member’s shareholding to be represented by each
proxy.
S336 – unless prohibited by the constitution, a proxy may be elected
to be the chairperson.
S337 – proxy can demand for a poll
Company Meeting/SS 39
S290 - Resolution
By a written
resolution
Private
company
Passing a At a Meeting of
Members(MOM)
resolution
– how? At a Meeting of
Public Company Members
(MOM) or AGM
Company Meeting/SS 40
• S 291 – it is passed by a simple majority of
Kinds of resolutions
more than half of members who are entitled
Ordinary to vote and do vote in person or by proxy at
a MOM or on a written resolution.
Resolution • On matter of less important
• Require special notice of the following:
S 291 • Remove directors before term.s206(3)
• Remove auditor at a GM s277(1)
• Appointment of auditor s280(2)
• A resolution of which a notice of not less than 21
days has been given and passed by a majority
of not less than 75% of members who are
Special entitled to vote and do vote in person or by
proxy at a MOM or on a written resolution.
Resolution • On matter of more important. E.g.
• Adoption of a constitution– S32
s 292 • Alteration of the constitution by company– s36
Company Meeting/SS 41
Records of resolution and meeting
S 341(1) - A company must keep record of :
◼ all resolution of members passed otherwise than at MOM;
◼ Minutes of all proceedings of MOM; and
◼ Details provided to the company in accordance with s344.
The record must be kept for at least 7 years from the date of
the resolution, meeting or decision.
Must be signed by the chairman.
S341(3)- every officer who contravenes this, commits an
offence and shall, on conviction, be liable to a fine not
exceeding RM10,000 and further fine RM500 for each day
of a continuing offence, if any.
Company Meeting/SS 42
Irregularities
S582(2)- Any irregularities in meeting my be
validated by the court unless the court is of
the opinion that the irregularity has caused or
may cause substantial injustice.
Irregular – absence of quorum or deficiency
of notice.
Purpose of S 582 – to enable the court to
make orders in cases where the rights of
members or creditors are interfered with.
Company Meeting/SS 43
Lim Hean Pin v Thean seng Co Sdn Bhd
[1992] 2 MLJ 10
The P’s proxy was excluded from voting at AGM.
The P contended – the meeting should be declared
null and void.
The D argued that the exclusion of the P’s proxy
was a mere irregularity that had not occasioned
substantial injustice & could be cured by s
355(equivalent to s 582 of the CA 2016).
Held: in favour of the P. excluding the proxy and
thus preventing the P from exercising his statutory
right to vote was not a mere procedural irregularity
curable by the majority but an illegality since it was
an abuse of power or oppression on the minority.
Company Meeting/SS 44
The End
Company Meeting/SS 45
