How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Alex J. Your Own Question
Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3653
Experience:  Solicitors 2 years plus PQE
13113900
Type Your Law Question Here...
Alex J. is online now

I am a shareholder of a limited company. At the AGM, I and

Resolved Question:

I am a shareholder of a limited company.
At the AGM, I and a minority number of shareholders want to record the meeting.
The Directors voted and said we were not allowed to record the meeting.
In light of the fact that the minutes rarely reflect the meeting, statements are made that are defamatory and/or personal and/or factually incorrect about individual shareholders and that we believe that a criminal act may be committed in terms of misinterpretation of the facts and the above.
Do we have a right to advise we are recording the meeting and not stop recording irrespective of the voting to deny us that right? what can we state in terms of supporting that right
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Alex J. :

Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. I am a company law expert. How many shareholders are there? Do the meetings have a chairperson?

Customer:

Hi ALex

Customer:

52 Shareholders.
There are 4 directors one of which is the chairperson.

Customer:

All directors are shareholders with one share each

Alex J. :

Hi, Thank you. The chairperson is free to conduct the rules of the meeting. If they say that no sound recordings may be taken then you have to abide by that rule.

Alex J. :

In making this rule they are setting a reasonable expectation of privacy and making a recording would be in breach of this. This leaves you with the following options:

Alex J. :

1. Make a hand written transcript of the meeting. Really the only relevant business will be the acutal resolutions that are voted on. If the directors are being fraudulent or misleading the shareholders then there are protections under S.994 of the Companies Act 2006 act against unfairly prejudicial behaviour.

Alex J. :

Further more S.260 allows shareholders to bring derivative actions against directors if you can prove breach of duty.

Alex J. :

2. Make the sound recording any way in secret. In doing this you have to bare in mind that you will only have limited uses of such information - for example you would need permission of a court to use it as admissible evidence in a trial.

Alex J. :

If the directors found out you had the recording they could injunct you to destroy it.

Alex J. :

Therefore really you would only be able to use it to make a written transcript.

Alex J. :

3. Get the directors to appoint an official transcriber of the minutes or make one official recording that can be done by the transcriber.

Alex J. :

If you have enough shareholders to support you, you can just insist that recordings be allowed at an AGM by resolution?

Customer:

I read on one of the sites that as the law of the land takes precedence.
That if one suspects that a criminal act act may occur that you have a right to record?

Customer:

nfortunately the official transcriber is the chairpersons wife!

Alex J. :

Hi, Thank you. If you suspect criminal activity then I would just record the AGM covertly.

Alex J. :

You are balancing competing interests here - its either you worry about what the directors might try and do or allow the criminal behaviour to continue.

Customer:

Thank You

Alex J. :

Just bare in mind you wont be able to use the recording in court proceedings with the permission of the court. If the directors find out, there is not really that much they can do, especially if they are then subject to a criminal investigaton

Alex J. :

just bare in mind that if you do make the recording covertly and they find out, and nothing comes of your investigation or compliant, they are likely to treat you as an outcast and probably be less co operative (that is just a practicality).

Customer:

Agreed. Thank You

Alex J. and 2 other Law Specialists are ready to help you