Board Meeting Minutes Legal Requirements California

As with insurance, the only time you really miss is to have formal minutes, . when they are needed. As soon as there is a dispute within a company about what happened or what decisions were made, or when an external authority, such as the Internal Revenue Service or a potential buyer, wants to confirm that action is being taken, protocol becomes absolutely vital. Minutes of board meetings are “association documents” that can be viewed by association members under certain restrictions. (Civ. Code § 5200(a)(8); See also “Records Under Inspection.”) Executive committees are composed of directors and are empowered to act on behalf of the board of directors. (Corp. Code § 7212(a).) If an Executive Committee has “decision-making powers”, the minutes of its meetings must be kept and made available to members for inspection within fifteen (15) calendar days of approval. (Code Civ. § 5210; See also “Registration Deadlines.”) There are a number of jurisdictions that diminish the importance of the minutes of a board meeting. Courts generally believe that the minutes are only prima facie evidence of what attended the meeting and can be refuted by the proof of pay.

For example, in Hughes Manufacturing & Lumber Co. v. Wilcox (App. 1910) 13 Cal.App. 22, the court stated: “It is equally irrelevant that the minutes do not disclose the actions of the commission with respect to certain matters. At most, the minutes of the deliberations of the Board of Directors constitute only prima facie evidence of its actions. In the absence of registration of the proceedings, they may be justified by proof of remuneration. The content of the protocol may also affect the level of investigation. For example, the Internal Revenue Manual states: “The auditor must consider all schedules, exhibits and reports as part of the protocol.

If they are not marked with the logbook, they must be requested as an integral part of the logbook. This would include the correspondence mentioned in the Minutes. Internal Revenue Manual (Part IV, Section, Protocol) (30.08.2010). The Internal Revenue Manual also states that “the data listed in the protocols will help identify possible delays for document sampling.” Id. Enterprise protocols offer several benefits for an organization. They help reduce the risk of future litigation and provide a reliable record of compliance with resolutions in the event that the company needs concrete evidence to support a decision or action. Because California law is silent on the subject, legal treaties, to which judges and arbitrators often refer, can be helpful. These include Fletcher`s Corporations, California Jurisprudence, and other texts, but none of these texts indicate a requirement to use any particular form of protocol. In California, the Attorney General has the power to regulate nonprofit corporations.

At a minimum, the California Corporations Code requires nonprofits to keep “minutes of the proceedings of their members, board of directors, and committees of the board” in “written form or any other form that can be converted into a clearly legible physical form or any combination of the foregoing,” and for which they may be admitted as evidence for any accepted purpose. See sections 6320, 8320 and 9510 of the C.C.C. For not-for-profit organizations, considerations relating to the practice of documentation should go beyond what is minimally required, as minutes of meetings can be important evidence to defend against lawsuits such as allegations against a director of breach of fiduciary duties. This can work until there is an audit or dispute within the company about when written minutes and resolutions can suddenly become vital. This often only happens when there is a death in the family or a new owner is brought in or a divorce occurs; But it happens, and it`s not uncommon to hear angry owners accuse previous owners or board members of negligence for not keeping accurate records of what happened many years ago. Since tax authorities require proof of the company`s critical financial decisions, the absence of such protocols can be extremely costly. Minutes or approvals of meetings list the actions contemplated, the resolution taken and the vote of each director or shareholder on each decision. Shareholders are required to sign minutes of shareholder meetings, while directors sign minutes of board meetings.

Minutes and copies of communications of the meeting (or waiver of notification) sent to meeting participants will be kept in the Corporation`s minutes book. For the broader meeting of the school committee, the Brown Act only provides for the possible recording and broadcasting of the meeting. The League of California Cities summarized the part of the Brown Act in California Government Code Section 54953.5(a) that refers to records of citizens` meetings: Most associations are incorporated under the California Company Code.