The sections, word for word
Every section on this subject, exactly as printed in the Official Gazette (Act No. 3 of 2020). The explanation follows beneath.
Section 258. Resolutions
(1) A resolution is an ordinary resolution when it has been passed by a simple majority of votes cast by members of the company as, being entitled to do so, vote in person or by proxy at a general meeting.
(2) A resolution is a special resolution when it has been passed by at least three-fourths of the votes cast by members of the company as, vote in person or by proxy at a general meeting of which 21 days’ notice, specifying the intention to propose the resolution as a special resolution, has been duly given : Provided that, if it is so agreed by majority in number of the members having the right to attend and vote at any such meeting, being a majority together holding at least 95% in nominal value of the shares giving that right or, in the case of a company not having a share capital, together representing at least 95% of the total voting rights at that meeting of all the members, a resolution may be proposed and passed as a special resolution at a meeting of which less than 21 days’ notice has been given.
(3) At any meeting in which a special resolution is submitted to be passed, a declaration of the chairman that the resolution is carried is, unless a poll is demanded, conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against the resolution.
(4) In computing the majority of a poll demanded on the question that a special resolution be passed, reference shall be had to the number of votes cast for and against the resolution.
(5) For the purposes of this section, notice of a meeting is deemed to be duly given and the meeting to be duly held when the notice is given and the meeting held in the manner provided by this Act or the articles.
(6) A company may, by its articles, provide that any matter not required by the articles or this Act to be passed by a special resolution, shall be passed by an ordinary resolution.
Section 259. Written resolutions
All resolutions shall be passed at general meetings and are not effective unless so passed, but in the case of a private company a written resolution signed by all the members entitled to attend and vote are as valid and effective as if passed in a general meeting.
Section 260. Circulation of members’ resolutions
(1) Subject to provisions of this section, it is the duty of a company, on the requisition in writing of such number of members as specified in this section and (unless the company otherwise resolves) at the expense of the company to—
(a) give to members of the company entitled to receive notice of the next annual general meeting notice of any resolution submitted by a member which may properly be moved and is intended to be moved at that meeting ; and
(b) circulate to members entitled to receive notice of general meeting any statement of not more than 1,000 words with respect to the matter referred to in any proposed resolution or the business to be dealt with at that meeting, and where the statement has more than 1,000 words to circulate a summary of it.
(2) The number of members necessary for a requisition under subsection (1) shall be—
(a) any one or more members representing at least one-twentieth of the total voting right of all the members having at the date of the requisition a right to vote at the meeting to which the requisition relates ; or
(b) at least 100 members holding shares in the company on which there has been paid up an average sum, per member, of at least N500.
(3) Notice of any such resolution shall be given, and any such statement shall be circulated, to members of the company entitled to receive notice of the meeting, by serving a copy of the resolution or statement on each such member in any manner permitted for service of notice of the meeting, and notice of such resolution is given to any other member of the company by giving notice of the general effect of the resolution in any manner permitted for giving notice of meetings of the company : Provided that the copy is served, or notice of the effect of the resolution is given, as the case may be, in the same manner and at the same time as notice of the meeting and, where it is not practicable for it to be served or given at that time, it shall be served or given as soon as practicable.
(4) A company is not bound under this section to give notice of any resolution or to circulate any statement unless—
(a) a copy of the requisition signed by the requisitionists (two or more copies which between them contain the signatures of all the requisitionists) is deposited at the registered office of the company—
(i) in the case of a requisition requiring notice of a resolution, at least six weeks before the meeting, and
(ii) in the case of any other requisition, at least one week before the meeting ; and
(b) there is deposited or tendered with the requisition, a sum reasonably sufficient to meet the company’s expenses in giving effect to it, but if, after a copy of a requisition requiring notice of a resolution has been deposited at the registered office of the company, an annual general meeting is called for a date six weeks or less, the copy, though not deposited within the time required by this subsection, is deemed to have been properly deposited for that purposes.
(5) The company is also not bound under this section to circulate any statement if, on the application of the company or any other person who claims to be aggrieved, the court is satisfied that the rights conferred by this section are being abused to secure needless publicity for defamatory matter, and the Court may order the company’s costs on an application under this section to be paid in whole or in part by the requisitionist, notwithstanding that the requisitionist is not party to the application.
(6) Notwithstanding anything in the company’s articles, the business which may be dealt with at an annual general meeting includes any resolution of which notice is given in accordance with this section and for purposes of this subsection, notice is deemed to have been given, notwithstanding the accidental omission in giving it to one or more members.
(7) Where there is default in complying with the provisions of this section, each officer of the company is liable to a penalty in such amount as the Commission shall specify in its regulations.
Section 261. Resolutions requiring special notice
Where by any provision contained in this Act, special notice is required of a resolution, the resolution is not effective unless notice of the intention to move it has been given to the company at least 28 days before the meeting at which it is to be moved, and the company shall give its members notice of any such resolution at the same time and in the same manner as it gives notice of the meeting, or if that is not practicable, shall give them notice thereof, either by advertisement in a newspaper having an appropriate circulation, or in any other mode allowed by the articles, at least 21 days before the meeting : Provided that if, after notice of the intention to move such a resolution has been given to the company, a meeting is called for a date 28 days or less after the notice has been given, the notice, though not given within the time required by this section, is deemed to have been properly given.
Section 262. Registration and copies of certain resolutions
(1) Subject to section 51 (7) (b) of this Act, a printed copy of every resolution or agreement to which this section applies shall, within 15 days after the passing or making of the resolution or agreement, be forwarded to the Commission.
(2) Where, pursuant to the provisions of sections 49-52 of this Act, a company by special resolution alters the provisions of its memorandum and the Commission is satisfied that the alteration is not in compliance with the applicable provisions of those sections, it may refuse to file a copy of the resolution in its records and shall notify the company, and any person aggrieved by the refusal may appeal to the court within 21 days from the receipt of the notification.
(3) A copy of every such resolution or agreement shall be embodied in or annexed to every copy of the articles issued after the passing of the resolution or making of the agreement.
(4) This section applies to—
(a) special resolutions ;
(b) resolutions which have been agreed to by all the members of a company, but which, if not so agreed to, would not have been effective, unless they had been passed as special resolution ;
(c) resolutions or agreements which have been agreed to by all the members of any class of shareholders but which, if not so agreed to, would not have been effective, unless they had been passed by some particular majority or in some particular manner, and all resolutions or agreements which effectively bind all the members of any class of shareholders though not agreed to by all those members ; and
(d) resolutions requiring a company to be wound up voluntarily, passed under section 620 (1) (a) of this Act.
(5) If a company fails to comply with subsection (1), the company and each officer of the company are liable to a penalty in such amount as the Commission shall specify in its regulations.
(6) If a company fails to comply with subsection (3), the company and each officer of the company are liable to a penalty for each copy in respect of which default is made in such amount as the Commission shall specify in its regulations.
(7) For the purposes of subsections (5) and (6), a liquidator is deemed to be an officer of the company.
Section 263. Effect of resolutions passed at adjourned meetings
Where a resolution is passed at an adjourned meeting of—
(a) a company,
(b) the holders of any class of shares in a company, or
(c) the directors of a company, the resolution shall, for all purposes be treated as having been passed on the date on which it was in fact passed, and not be deemed to have been passed on any earlier date.
What this means
Short answer
An ordinary resolution needs a simple majority of the votes cast. A special resolution needs at least three-quarters of the votes cast, at a meeting with 21 days’ notice that says it will be proposed as a special resolution (section 258). A private company can also pass a written resolution signed by all members entitled to attend and vote (section 259).
Ordinary and special resolutions
Section 258(1) says a resolution is ordinary when it passes by a simple majority of the votes cast by members entitled to vote, in person or by proxy, at a general meeting. Under section 258(2), a special resolution needs at least three-fourths of the votes cast at a general meeting for which 21 days’ notice, specifying the intention to propose a special resolution, has been given.
Shorter notice is possible. If a majority in number of the members entitled to attend and vote agree, and together they hold at least 95% in nominal value of the shares giving that right, a resolution can be proposed and passed as a special resolution on less than 21 days’ notice. For a company without share capital the figure is 95% of the total voting rights. A company’s articles can also say that matters not requiring a special resolution may be passed by ordinary resolution (section 258(6)).
Written resolutions
Section 259 says all resolutions must be passed at general meetings and are not effective otherwise. The exception is a private company: a written resolution signed by all the members entitled to attend and vote is as valid and effective as one passed at a general meeting. Public companies cannot use this route.
Special notice
Where the Act requires special notice of a resolution, the resolution is not effective unless the company received notice of the intention to move it at least 28 days before the meeting. The company must then tell members at the same time and in the same way as it gives notice of the meeting, or, if that is not practicable, by newspaper advertisement or another mode the articles allow, at least 21 days before the meeting (section 261). Removing a director is one example (see leaving the board).
Filing resolutions with the Commission
A printed copy of every special resolution, and of the other resolutions listed in section 262(4), must reach the Commission within 15 days of being passed or made. If a company fails to comply, the company and each officer are liable to a penalty set by the Commission (section 262(1) and (5)). A copy must also be attached to every copy of the articles issued afterwards (section 262(3)).
Resolutions proposed by members
Under section 260, a company must, on a written requisition, give notice of a member’s proposed resolution for the next annual general meeting and circulate a statement of up to 1,000 words. The requisition needs either members holding at least one-twentieth of the total voting rights, or at least 100 members with an average of at least ₦500 paid up per member. A requisition for notice of a resolution must be deposited at the registered office at least six weeks before the meeting, and any other requisition at least one week before, with enough money to cover the company’s expenses.
Questions and answers
What is a written resolution?
A resolution in writing signed by all the members entitled to attend and vote. Only a private company can use it, and it is as valid as a resolution passed at a general meeting (section 259).
What majority does a special resolution need?
At least three-fourths of the votes cast at a meeting for which 21 days’ notice of the special resolution has been given (section 258(2)).
Can a special resolution be passed on shorter notice?
Yes, if a majority in number of the members entitled to vote, holding at least 95% in nominal value of the shares carrying that right, agree (section 258(2)).
How soon must a special resolution be filed with the Commission?
Within 15 days of being passed (section 262(1)).
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