NSW Company Directors - Are Board Minutes Now Considered Invalid?

[EmmaG]

I served as a director for a company for a period of time. A number of new board appointments were made and the final minutes of the board meeting when I was a director were in a draft format prior to stepping down as a director of the business. The company directors at that time never signed or approved them but they were being circulated for discussion before the board change over.

The new board that stepped in never approved these minutes in the next board meeting and have now asked me ( many many months later) to recall what was agreed in that meeting.

My questions are:

1. If the minutes were not entered into the minute book within 30 days are they still valid? On what grounds can they be legally binding?

2. Has the new board missed the boat on ratifying these minutes?

3. Can the new board ask an ex director to confirm and recall what was agreed in that meeting? Given so much time has passed.

4. Can an ex director keep copies of board minutes on file after they step down from acting as a director? Or should they discard and destroy this information?

 

[Adam1user]

Hi,
I don't have much info on this matter, but the only key point that may help is that reporting to AISC as change of directors, if this is what worries you regarding your responsibilities, if it has been reported then you are no longer a director. If not, then you need to speak to a lawyer or solicitor, that is the best way to go.
I hope that helps.

 

[Rod]

1. Yes. Assumes other formalities have been complied with eg quorum etc.
2. New board can't ratify as they did not participate in the original meeting
3. Yes. Need to be careful here because directors hold special duties.
4. If the company doesn't have a board/document policy then you can probably assume they are personal records. If anything shady was happening with either the new or old board I'd be keeping the copies.

 

[EmmaG]

Thanks so much Rod.

regarding point 3. What duties that arose during my directorship might have continuing effect after the directorship has come to an end ? I did not realise there were any special duties that continued..

 

[Rod]

There are a number of duties but can be categorised as using information obtained as director for your personal benefit, even after leaving the company, and competing with the company, again using information gathered as a result of being a director.

The duties diminish over time, not when the directorship ends, and are looked at on a case by case basis. Else unscrupulous directors would be free to rip off and destroy business goodwill by simply resigning.

Full disclosure, and preferably consent, can be a defence.