GAMING & LEISURE Alert: Good News for Clubs on Members General Meetings

Apr 27 2015

Publications

Previously, under section 249D of the Corporations Act 2001, a Club Board could be required to call and hold a General Meeting on the request of:

  • members with at least 5% of the votes that may be cast at the general meeting; or
  • 100 members entitled to vote at the general meeting,

whichever was less, provided that the members’ request met the relevant legal criteria. This is in most Club Constitutions that we have seen over the years.

However, this was creating undue cost and expense for many clubs because 100 members represents a relatively small number in the overall membership of many companies, and legislation was allowing a very small percentage of members to require a company to hold a General Meeting and sometimes incur substantial costs as a result.

The Corporations Legislation Amendment (Deregulatory and Other Measures) Act 2015 removes the right for 100 members to require the Board to call a General Meeting. Instead, only members with at least 5% of the votes that may be cast at the General Meeting will be able to make such a request to the Board. If you have 20,000 members, for example, it will now take 1000 members to call a meeting instead of 100.

This change does not affect the requirement for a Club to hold the Annual General Meeting each year.

Any Club which receives a request from members to call and hold a General Meeting should seek legal advice, to ensure that the Board meets its obligations under the law. Clubs should also review their Constitution for consistency with the current law.

We are offering a free quick check of your Constitution to let you know if it needs to be amended.

Please contact Vivienne Young on 02 8248 5838 or vyoung@tglaw.com.au or Sherif Mouakkassa on 02 8248 5837 or smouakkassa@tglaw.com.au for your free quick check.