This takes the place of Section 71 of the old Act. The only change involved is the addition of subsection (4). That is the penalty clause.
SECTION 145.
Question proposed: " That Section 145 stand part of the Bill."
I think this is the section Deputy de Valera had in mind when he raised a point about meetings earlier.
This is in regard to the signing of minutes. It is covered by subsection (2) of Section 71 of the Act of 1908. When are the minutes signed? Does the chairman sign them on his own initiative immediately afterwards? The usual procedure is that the minutes are read, approved and signed at a meeting.
Or signed at the next meeting, not necessarily by the same chairman.
If there is a meeting held today and, another in a week's time, the usual procedure is that the minutes are read. The people present decide they are fair and accurate minutes, and, with the concurrance of the meeting, the chairman signs the minutes. In the case of an annual general meeting, where there is a lapse of a year it is necessary to have evidence of that meeting in between. I think there are different practices. Sometimes you wait for a year to sign. It is the following chairman who signs. There is also the practice where the minutes may be signed at the following directors' meeting. That is very common. It is still rather ambiguous. According to this, on another reading, the chairman could draft minutes, sign them and then they are evidence. Is it desirable to deal with that point now?
Must there not be agreement by those present that the minutes are accurate?
Not necessarily.
How can a person write minutes and sign them as the authority for certain proceedings if in fact the contents are at variance with the facts?
The point I am making is as to when the minutes are to be signed when there is a lapse of a year. Too frequently it is done at the next director's board meeting. In an odd case they may wait until the following year to read them. In any event, is it desirable that the usual procedure of having them signed at the next director's meeting should be recognised?
It is an unusual practice.
This is a thing that has not caused any trouble. As the Minister said, this section is virtually a re-enactment of the existing situation and brings in no change in the law. It is a question of letting sleeping dogs lie.
What would happen in this instance? I was at a directors' meeting yesterday. I was not the chairman. After we finished, the chairman drew up a minute of what was done and signed that minute. It was necessary to do so because the minute, which was in fact a minute authorising a new person to sign on the bank account, had to be sent to the bank straight away. Suppose that minute were wrong? The chairman had signed it. Where is there in this Act power to apply to the court to get it set aside?
In fairness, it only says, " shall be evidence ". It does not make it conclusive.
That is right
I think you could appeal.
There is no provision in the normal articles of association for the agenda of a meeting, including the reading and signing of the minutes. As I understand it, that is purely a matter of custom. There is no statutory obligation. It might be contended that that is something in the interest of shareholders. Otherwise the minutes of the company might be wrong and the shareholders would have no right to inspect them in a year's time. There is a right of inspection in Section 146, but it is not as obvious as the right normally exercised by a member of a company listening to the minutes being read.
I think you will run into certain difficulties if you try to do what, in effect, Deputy de Valera was suggesting we might consider : to lay down the time at which the minutes are to be signed, which you would have to do to meet Deputy Booth's point. I think you could run into a lot of difficulty. The existing section is probably as good as you could do.
I think you right there, Mr. Chairman. It would be very dangerous. It would be difficult to legislate here for the time and manner in which the minutes are to be signed.
Except I think the people at the meeting ought to have some say. The venue and time is another matter. They should have some say as to the accuracy of what purport to be the minutes. and the chairman ought not be allowed to run haywire.
I think the position is merely for the purpose of getting some kind of evidence of what happened and the chairman's signature is prima facie evidence of what happened but it does not preclude people from contesting the accuracy of these minutes.
There must be volumes of case law on this. If we raise this stone, we do not know what might crawl out.
Some of the difficulty might be met by providing when the minutes will be written rather than when they will be signed. It would tie in more with Section 146 and the case mentioned by Deputy Norton. People will go along and inspect the minutes.
You could provide that minutes shall be written " as soon as may be after a meeting ". That is a famous phrase.
I shall consider that, certainly.
Would the Minister also consider—I am not sure whether I want this but I do want it on the record to remind us—whether it is desirable to legislate in subsection (1) for the provision of minutes of the meetings of a committee of directors ? If directors appoint a committee, ought we say that they must keep a record of their decisions ? Subsection (1) of Section 145 says :
Every company shall cause minutes of all proceedings of general meetings and all proceedings at meetings of its directors to be entered in books kept for that purpose.
What about committees of directors ?
Is it necessary ?
A committee is regularly given power to affix the seal, for example, and it is very important that records—
It is probably covered by the phrase " meetings of its directors ". However, I will consider that.
Question put and agreed to.