What makes a general meeting resolution valid?

The short answer

A general meeting resolution is valid when the meeting was properly called, the item was on the notice, any quorum was met, only those entitled to vote voted, and the majority your law and rules require was reached, counted on the right base. Miss one of these and the resolution can be challenged.

An ordinary resolution usually needs a simple majority, more than half. A special resolution needs a larger, qualified majority, such as 75% in UK company law. The sections below take each condition in turn.

What makes a resolution valid?

Six conditions, in the order a meeting meets them:

1. Proper notice. The meeting was called by the right person, to every member entitled to notice, within the period your law and rules set. A UK private company needs at least 14 days (Companies Act 2006, s. 307(1)).
2. The item was on the notice. Members must know in advance what will be decided. German association law makes this a condition of validity: the subject must be named when the meeting is called (BGB § 32(1)).
3. Quorum, where one is required. Under the UK Act, in a company with more than one member, two qualifying persons present are a quorum unless the articles say otherwise (CA 2006, s. 318(2)). See how many is a quorum.
4. Only entitled votes count, at the right weight. Check the register: who may vote, through which proxy, and with how many votes per share or unit. See how voting weight is calculated.
5. The required majority, on the right base. Ordinary or special, of votes cast or of all voting rights, as the next sections explain.
6. A record. The minutes state the motion, the result and how it was counted. Without a record, a valid decision is hard to prove.

What is the difference between an ordinary and a special resolution?

The threshold. In UK company law an ordinary resolution is passed by a simple majority (CA 2006, s. 282(1)) and a special resolution by a majority of not less than 75% (s. 283(1)). Other laws use other names for the same idea: a simple and a qualified majority.

German association law goes further for one decision: changing the purpose of the association needs the consent of all members, and absent members must consent in text form (BGB § 33(1)). Your own articles may set higher thresholds than the law.

How is a majority counted?

On a base your law sets, and the base changes the result. Three bases are common:

• Votes cast. A German association decides by a majority of the votes cast (BGB § 32(1)). On a UK show of hands, a special resolution needs 75% of the votes cast by those entitled to vote (s. 283(4)).
• Voting rights of those who vote. On a UK poll, a resolution needs a majority of the total voting rights of the members who vote in person, by proxy or in advance (s. 282(4)). Each share’s votes count, not each person.
• All eligible voting rights. A UK written resolution needs a majority of the total voting rights of all eligible members, whether they respond or not (s. 282(2)).

How votes are counted shows how Assembley counts an item against the requirement you set.

How are abstentions counted?

It depends on the base. Where the rule is a majority of votes cast, an abstention is generally not a vote cast, so it counts neither for nor against. Where the base is everyone present or all members, an abstention works like a vote against. Check how your rules define the base.

Example, with hypothetical numbers. 100 members, one vote each; 60 take part: 35 for, 20 against, 5 abstain.

The same ballots pass under one base and fail under another. Record which base you used.

Can a resolution be passed without a meeting?

Sometimes. A UK private company can pass a written resolution, on the base of all eligible voting rights (s. 282(2)). A German association can decide without a meeting if all members consent to the resolution in text form (BGB § 32(3)).

What happens if a condition is missed?

The resolution can be challenged, and depending on your law it may be void or voidable. Courts and laws differ on which defects matter. Fixing it usually means calling a new, properly noticed meeting and voting again. If the meeting itself is held online, check the format first: can a general meeting be held online?

Checklist before the vote

• The notice went out on time and named every item to be decided.
• Quorum is met, if your rules require one.
• The register shows who may vote, with which weight, and which proxies are valid.
• You know whether each item needs an ordinary or a special resolution.
• You know the base: votes cast, voting rights of those voting, or all members.
• You know how abstentions and invalid votes are treated.
• The minutes record motion, result, figures and base.

Where Assembley fits

Assembley tracks quorum, records proxies, weights votes by shares held and produces documented minutes with an evidence package. Which majority and base apply is set by your law and your rules. Votes by shares need theAdvanced voting add-on; without it, each voter has one vote.