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Minutes of members' and directors' decisions

Many private companies neglect to keep propoer minutes of the members' and directors' decisions, but this is unwise. Not only is there a statutory requirement to keep proper records (see below), such minutes may be crucially important as evidence of what occured, which could be of major importance if the parties disagree or there are disputes with third parties. The lack of such minutes can also hamper the sale of a company, as proper due diligence cannot be carried out by the purchaser without such records.
The following provisions of the Companies Act 2006 apply:

Members decisions

Directors' decisions

Members' decisions

Sec355 Records of resolutions and meetings etc
(1) Every company must keep records comprising-
(a) copies of all resolutions of members passed otherwise than at general
meetings,
(b) minutes of all proceedings of general meetings, and
(c) details provided to the company in accordance with section 357
(decisions of sole member).
(2) The records must be kept for at least ten years from the date of the resolution,
meeting or decision (as appropriate).
(3) If a company fails to comply with this section, an offence is committed by every
officer of the company who is in default.
(4) A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 3 on the standard scale and, for
continued contravention, a daily default fine not exceeding one-tenth of level
3 on the standard scale.

Sec356 Records as evidence of resolutions etc
(1) This section applies to the records kept in accordance with section 355.
(2) The record of a resolution passed otherwise than at a general meeting, if
purporting to be signed by a director of the company or by the company
secretary, is evidence (in Scotland, sufficient evidence) of the passing of the
resolution.
(3) Where there is a record of a written resolution of a private company, the
requirements of this Act with respect to the passing of the resolution are
deemed to be complied with unless the contrary is proved.
(4) The minutes of proceedings of a general meeting, if purporting to be signed by
the chairman of that meeting or by the chairman of the next general meeting,
are evidence (in Scotland, sufficient evidence) of the proceedings at the
meeting.
(5) Where there is a record of proceedings of a general meeting of a company,
then, until the contrary is proved-
(a) the meeting is deemed duly held and convened,
(b) all proceedings at the meeting are deemed to have duly taken place,
and
(c) all appointments at the meeting are deemed valid.

Sec357 Records of decisions by sole member
(1) This section applies to a company limited by shares or by guarantee that has
only one member.
(2) Where the member takes any decision that-
(a) may be taken by the company in general meeting, and
(b) has effect as if agreed by the company in general meeting,
he must (unless that decision is taken by way of a written resolution) provide
the company with details of that decision.
(3) If a person fails to comply with this section he commits an offence.
(4) A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 2 on the standard scale.
(5) Failure to comply with this section does not affect the validity of any decision
referred to in subsection (2).

Sec58 Inspection of records of resolutions and meetings
(1) The records referred to in section 355 (records of resolutions etc) relating to the
previous ten years must be kept available for inspection-
(a) at the company's registered office, or
(b) at a place specified in regulations under section 1136.
(2) The company must give notice to the registrar-
(a) of the place at which the records are kept available for inspection, and
(b) of any change in that place,
unless they have at all times been kept at the company's registered office.
(3) The records must be open to the inspection of any member of the company
without charge.
(4) Any member may require a copy of any of the records on payment of such fee
as may be prescribed.
(5) If default is made for 14 days in complying with subsection (2) or an inspection
required under subsection (3) is refused, or a copy requested under subsection
(4) is not sent, an offence is committed by every officer of the company who is
in default.
(6) A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 3 on the standard scale and, for
continued contravention, a daily default fine not exceeding one-tenth of level
3 on the standard scale.
(7) In a case in which an inspection required under subsection (3) is refused or a
copy requested under subsection (4) is not sent, the court may by order compel
an immediate inspection of the records or direct that the copies required be
sent to the persons who requested them.

Sec359 Records of resolutions and meetings of class of members
The provisions of this Chapter apply (with necessary modifications) in relation
to resolutions and meetings of-
(a) holders of a class of shares, and
(b) in the case of a company without a share capital, a class of members,
as they apply in relation to resolutions of members generally and to general
meetings.

Directors' decisions

Sec248 Minutes of directors' meetings
(1) Every company must cause minutes of all proceedings at meetings of its directors to be recorded.
(2) The records must be kept for at least ten years from the date of the meeting.
(3) If a company fails to comply with this section, an offence is committed by every officer of the company who is in default. (4) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.

Sec249 Minutes as evidence
(1) Minutes recorded in accordance with section 248, if purporting to be authenticated by the chairman of the meeting or by the chairman of the next directors' meeting, are evidence (in Scotland, sufficient evidence) of the proceedings at the meeting. (2) Where minutes have been made in accordance with that section of the proceedings of a meeting of directors, then, until the contrary is proved- (a) the meeting is deemed duly held and convened,
(b) all proceedings at the meeting are deemed to have duly taken place, and
(c) all appointments at the meeting are deemed valid.