Publications

Annual Meeting Governance: Special Resolutions

Feb 27, 2024 | ClubHub

What are Special Resolutions?
A special resolution is an approved motion for a significant proposal to effect major change raised at an Annual General Meeting (AGM) or Special General Meeting (SGM). It needs at least 75 per cent of members voting in favour for it to pass. For Incorporated Association clubs regulations concerning special resolutions are governed by the Association Incorporation Reform Act 2012. Common examples include:

• A proposal to undertake substantial expenditure of capital

• Changing the club’s name or rules

• Amalgamation with another club/association

• Voluntary winding up of the club

Democracy in Action – Why Transparency is Key
Special resolutions can spark emotional and philosophical debate, as members may question the club’s direction or the impact on their social and behavioural environment. For example, a special resolution proposing to spend a large amount of capital on a development at the club premises may have members questioning the necessity of the change or the motive behind it.

For this reason, transparency is extremely important. Members will likely feel more comfortable with significant changes when they understand the scope and intentions. One practical way to ensure the AGM/SGM where the special resolution is voted on runs smoothly is for committee members to organise an information evening beforehand to introduce the proposed change and field questions from members. Providing a ‘business case’ and ensuring that members understand the ‘What, Where, How and Why’ elements of the decision–making can ease anxiety and reservations concerning change, and allow them to be addressed in a productive and positive manner.

Raising Issues Within a Club
Another critical and often contentious issue that causes conflict in clubs is the manner and way in which to raise issues. Many clubs have implemented a board charter and code of conduct that serve them well in setting the culture and processes in how to manage and step through issues to seek mutually agreeable resolutions.

The focus should always be on creating an environment of respect, fun, friendship and ‘best practice’ management. Everyone should look forward to joining their club to enjoy common interests and a cohesive and friendly environment.

Pre-Director Training
In New South Wales pre-director training has been a mandatory pre-requisite to sit on a club committee/board for many years and this program has served their industry well.

In recent years CCV has focused more comprehensively on providing board governance seminars and training to assist directors in a proactive and educative way to appreciate their duties and legal obligations from a regulatory perspective.

It is a great idea to have a pre-director information session and information evening for your club’s members contemplating joining a committee; this can help them understand the important aspects of the roles and responsibilities and business operations of your club.

Implementing Special Resolutions
In relation to introducing special resolutions, the following information will assist in implementing and managing the procedural aspects of this discreet part of the club’s AGM or SGM.

Because special resolutions are used to make important decisions, it’s vital to give members more time and information about the matter so that they can consider it carefully before the meeting. The following framework must be followed carefullybefore the meeting. The following framework must be followed carefully before the meeting. The following framework must be followed carefully, otherwise, the resolution can’t be passed. All voting members must be given at least 21 days’ notice of the proposed special resolution. The notice must state the:

• Time, date and place where the meeting to vote on the special resolution will be held

• Proposed resolution in full

• Intention to propose the resolution as a special resolution.

A special resolution will be passed if:

• At least 75 per cent of members voting at the meeting (either in person or, if the rules of the association allow, by proxy) vote in its favour, and

• Any further relevant requirements from the rules have been met.

Additionally, the below guidelines must be followed in relation to the rules and minutes from the AGM/SGM where the Special Resolution was raised:

• If a member asks, the association must, at a reasonable time, let them inspect its rules and the minutes of general meetings.

• If a member makes a written request for a copy of the rules or minutes, the association must give them a copy within 14 days.

• Your association may also let a member inspect the minutes of committee meetings, but only if its rules allow it. A member does not have a general legal right to inspect minutes of committee meetings.

Amalgamation as a Special Resolution
If the special resolution is in relation to amalgamating clubs, the notice should:

• Nominate the first secretary of the amalgamated organisation

• Include the terms of the amalgamation, and

• Attach a copy of the proposed rules of the amalgamated organisation

An application to amalgamate can only be approved by Consumer Association Victoria if the application includes the relevant details above and is accompanied by evidence of the passing of the special resolution approving the amalgamation’s proposed terms and the amalgamated organisation’s rules.