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Case Update: Are All Matters Required to be Particularised in a Notice/Agenda of a Board of Director's Meeting?

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COMPANY LAW
Requirement of law to mandate the particularisation of a particular agenda for Company’s Board Meeting – Whether there is a legal requirement that the notice of board of directors’ meeting must contain particulars or sufficient particulars of the matters to be discussed at the board of directors’ meeting

Rozilawati Binti Haji Basir v Nationwide Express Holdings Berhad v 4 Others
2020 MLJU 1198, High Court
- see the grounds of judgment here

Facts By way of a notice dated 27.04.2018 (“Notice”), the Plaintiff and the directors of the 1st Defendant i.e. 2nd to 5th Defendants were informed of a board of directors’ meeting scheduled to be held on 30.05.2018 (“Board Meeting”) in accordance to the 1st Defendant’s Articles of Association dated 27.04.2016 (“Constitution”). The Board Meeting’s agenda dated 21.05.2018 (“Agenda”) was circulated to the Plaintiff and listed a number of matters to be discussed and resolved during the Board Meeting which included inter alia “to receive maters arising and to transact on any other matters” of the 1st Defendant. During the Board Meeting, the board of the 1st Director has unanimously resolved to inter alia terminate the Plaintiff’s contract of service as the Managing Director of the 1st Defendant with immediate effect (“Termination”). The Plaintiff then commenced a suit against the Defendants in relation to the board of directors’ decision to terminate her said contract of service. The Plaintiff has alleged inter alia that the 1st Defendant’s failure to state and/or particularise the intended Termination in the Notice and/or Agenda of the Board Meeting had rendered the said Board Meeting and/or resolutions passed therein being wrongful, ineffective, invalid, null and/or void. In the course of the proceeding, the Defendants had filed an application pursuant to Order 14A Rules of Court 2012 (“Order 14A Application”) where several questions of law were posed and answered which ultimately led to the Plaintiff’s entire action being struck out by the High Court with costs.

Issue The main issue in this case was whether there is a legal requirement that the notice of board of directors’ meeting must contain particulars or sufficient particulars of the matters to be discussed at the board of directors’ meeting?

Held The High Court dismissed the Plaintiff’s claim and held that there is no requirement of law to mandate the particularisation of a particular agenda for a Board Meeting and stated that the service of the Notice is in line with the Constitution and that the Constitution is silent on the need for the matters of particulars to be discussed at the meeting. The Court further held that it may be a matter of best practice in general for the meeting agenda to contain specifics of what will be discussed, it is not a necessity and/or requirement under the law, unless expressly required in the company’s constitution.

ZUL RAFIQUE & partners
{30 September 2020}