Bermuda: This Meeting Stands Adjourned

Last Updated: 12 October 2015
Article by Tiffany Boys

Adjournment means suspending a meeting after it has been duly commenced either indefinitely or so that it may be resumed at a future time and/or place fixed in that meeting or as decided later on.

A meeting may be adjourned automatically for want of a quorum or, where a quorum is present, either at the direction of the meeting or at the instance of the chairman.

Adjourning a meeting, concluding a meeting and postponing a meeting are different concepts.

To conclude a meeting is to bring a meeting to an end or to deem a meeting terminated once all the business on the agenda has been transacted, while to postpone means to defer or put off the meeting to a later time. A meeting is typically postponed before it has been actually held (by contrast, for valid adjournment, the holding of the original meeting at its scheduled time is necessary). Absent an express provision in the bye-laws, it is not possible to postpone or abandon a meeting once notice has been circulated.

This article will focus on how a meeting may be properly adjourned, as well as the formalities required with respect to an adjourned meeting.

The bye-laws of a Bermuda company may contain provisions outlining the circumstances when a chairman may adjourn a meeting, failing which the power to adjourn is vested in the meeting.

Under common law, a meeting is deemed to have the power to adjourn itself. Additionally, the chairman of a meeting has residual authority to adjourn a meeting if circumstances require.

The chairman's common law authority is a fiduciary one and must be exercised reasonably and for a legitimate purpose connected with the proper transaction of the business (and not merely to prevent the meeting from reaching a decision that he does not favour).

The chairman must take into account: whether the delay would benefit or prejudice the members, the expense of the adjournment and the likelihood of the vote at the adjourned meeting producing a different result.

The chairman must adjourn the meeting:

  • In absence of a quorum (the bye-laws usually allow the chairman to delay the start of the meeting for a short period of time if a quorum is not present); or
  • If requested to do so by the meeting.

Further, the chairman may adjourn the meeting:

  • In accordance with the provisions of the bye-laws.
  • With the consent of the meeting by way of resolution.
  • On his own authority if, in the chairman's opinion, it is not practical to get the consent of the meeting but it appears necessary to him to adjourn to facilitate the business of the meeting (e.g. the venue is not appropriate or unsafe); or
  • On his own authority, if, in the chairman's opinion, it is necessary to facilitate orderly conduct of the meeting (the adjournment should only be for such period necessary to restore order).

Subject to the bye-laws, a meeting may be adjourned indefinitely (sine die) or to a date, time and place:

  • As set out in the bye-laws.
  • As fixed in the meeting; or
  • To be subsequently determined by the board of directors of the company.

As a general rule, and subject to any contrary provisions in the bye-laws of the company, where notice of the original meeting had been properly given, there is no necessity for notice of its bona fide adjournment.

An adjourned meeting is merely the continuance of the original meeting and a fresh notice of the adjourned meeting is not therefore necessary unless the bye-laws require such a notice to be given (for instance, some bye-laws require notice of the adjourned meeting to be given when there is a long delay between the original meeting and the adjourned meeting).

However, in the case of an adjournment sine die (ie without appointing a day for a further meeting) fresh notice is necessary. Clearly the date and time of the adjourned meeting will need to be communicated to members and the notice provisions of the bye-laws must be followed.

As an adjourned meeting is a continuation of the original meeting, all procedural requirements must be complied with at the adjourned meeting for it to be valid, including:

  • All shareholders are entitled to attend the adjourned meeting (even if they were not present at the original meeting).
  • The same quorum will be required for the adjourned meeting as for the original meeting. If no quorum is present at the adjourned meeting, the bye-laws usually provide that the meeting will be dissolved.
  • Unless duly amended and/or revoked and subject to any contrary provision in the proxy, proxies received with respect to the original meeting remain valid.
  • No business shall be transacted at an adjourned meeting other than business that might properly have been transacted at the original meeting had the adjournment not taken place. In short, the meeting shall only consider business left uncompleted by the original meeting. If new business outside the scope of the original meeting is to be considered, fresh notice would be required; and
  • Any resolution passed at the adjourned meeting is deemed to have been passed at the date of the adjourned meeting.

Article first published in The Royal Gazette, October 2015

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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