Talk:Wikimedia South Africa/Tobias comments

PLEASE HAVE A LOOK AT MY ANSWERS, DISCUSS AND THEN GIVE ME SPECIFIC TASKS AS TO WHAT YOU WANT TO HAVE CHANGED IN OR ADDED TO THE DOCUMENTS.

Articles of Association

1

"When referring to "the directors" I assume you are referring to the Board of directors, and not individual directors? To me it was not entirely clear in all cases whether certain authorities also were delegated to individual directors.” Effeietsanders
In broad terms, the powers of the directors must be exercised by all directors acting together unless the articles of association authorise the board of directors to delegate such powers to one or more of their numbers.

2

“Auditors are referred to a few times, but never explicitely mentiones as to how they are appointed etc. How does this work?” Effeietsanders

The appointment & removal of auditors is dealt with in the Companies Act (sec 269 et seq). Generally, it is part of the business at every annual meeting to appoint an auditor. Before the first annual meeting, directors are required to appoint an auditor within 21 days of the date of incorporation.

3

“There is no notice of how the bylaws can be changed. Is this taken care of in the Statutes? Could you please clarify?” Effeietsanders

If the Bylaws do not contain special requirements for their alteration, the general rule is as follows: Both the Memorandum of Association and the Articles of Association may, according to sec 56(4) and sec 62 of the Companies Act respectively, altered by Special Resolution.

For the record, the vote is a "special resolution" explained at [1]. (effeietsanders)

4

Do I understand correctly that the General Meeting is the ultimate authority of the association and that the board of directors executes that? Effeietsanders

While the (Annual) General Meeting is indeed the ultimate authority of the company, the authorities of the directors should not be underestimated. In short, the directors exercise all such powers of the company that are not by either the Companies Act or the Articles/ Memorandum of Association required to be exercised by the company in general meetings. Directors manage the company.

5

Do I understand correct that the following bodies are defined: 1) General Meeting of members 2) Board of directors 3) Audit Committee. Effeietsanders 14:39, 5 October 2010 (UTC) - I don't know whether a meeting can be considered a body, and I see no mention of an audit committee in the text. Where did you see that? --Slashme 18:13, 12 November 2010 (UTC) - Article 6.1 and 13.2 Effeietsanders 14:04, 18 November 2010 (UTC) - Those talk about auditors, not an audit committee. --Slashme 07:57, 24 November 2010 (UTC)

The two defined organs (rather than bodies) – ‘Meetings of Members’ and ‘Board of Directors – are arguably the most important organs of a company. But other organs, officers and functionaries (incl. auditors) also play an important role in its governance.

6

“What is the procedure for budgets and financial controlling? Does the General Meeting have a voice in approving the budget / financial statements? How is the accuracy of the financial statements controlled? Effeietsanders 14:39, 5 October 2010 (UTC) - As I read 12.1, the directors decide on budgets and financial management. As for how the statements are controlled, that must be answered as part of your question on the auditing rules above. --Slashme 18:13, 12 November 2010 (UTC)”

Part of the normal business transacted at Annual General Meetings is the consideration of the annual financial statements.

7

“Can we add this to the definitions? --Slashme 07:02, 13 November 2010 (UTC): ‘Where a member has supplied an email address, email sent to that member (whether personally or through a mailing list) shall constitute notice in writing.’”

We can – and perhaps should to make things clear. This said, the ECT Act of 2002 gives full legal force and effect to data messages, including emails (see sec 11 and 12 ECT Act).

8

Expulsion of Members (sec 4.3.4). Under what circumstances would this be done? There are even two options (members or directors), it would be clearer if the only option would be the members. Or is this defined in the Statutes already? Does the member being removed have redress or a chance to explain? Can't we include an option for the member to appeal his removal? I think we should definitely add a point that states the person could ask for an appeal.

Seeing that the directors are running the day-to-day business of the company, I personally prefer if they can make such decisions as well. But it’s up to you. Perhaps one could think of reviewing such decisions at the Annual General Meetings – if such review is requested by the member concerned – based upon statements by both the removed member and the directors?

9

Membership fees and membership categories.

I don’t think we need minimum and maximum fees. As for the categories, yes, the wording of 4.4.2 (General members) and 4.4.4 (Sponsor members) reads the same but that obviously does not mean that both categories are treated the same by directors (eg in terms of the membership fees). I still think it makes sense to have the category “sponsor members” but it is obviously not something that we really need to have. Up to you again.

10

“Quorum, sec 5.3: This seems very archaic. Nowadays, whether someone is within the borders of RSA or not shouldn't affect their ability to call a meeting. --Slashme 16:44, 14 November 2010 (UTC)”

We can delete this sentence.

11

“What I was wondering about is whether it is possible to have your General Meeting in Johannesburg, and have a group of people join the meeting on distance in Capetown with a video link through Skype for example. That would save them quite a trip, which some might not be able to afford. Would that be something that you would want to be possible? From the current set, it is not clear to me if it would be allowed. Effeietsanders 21:12, 7 November 2010 (UTC)”

Interesting one – remember, the current Companies Act is from 1973 and this means that it is outdated in many respects and does not speak to many issue we consider normal these days. I have done some research and most colleagues I spoke to believe that Online AGMs should be possible, however, a few articles I read suggest otherwise. Now, I can change the Articles so that Online AGMs are provided for – but before I do this I want you to consider the advantages and disadvantages. Obviously, the advantage is a heightened possibility for members to attend. At the same, however, it is a bit of a logistical challenge for the company as there will be voting at AGMs and how do you make sure that the right people do vote? You probably have to send out unique passwords etc and have systems in place to restrict voting of others. Bet that as it may, my suggestion would be to first go ahead with offline AGMs as currently provided for in the Articles. See how the first AGM goes and if attendance was poor and travel barriers are to blame then we can still change the articles. Also, by then we should have our new Companies Act (enters into force on 1 April 2011 I believe) – and I have been told that this piece of legislation deals with virtual AGMs. So we can use this as a starting point. In any event, due to the change in legislation, we should probably earmark to review the entire Articles once the new Act is in force.

12

Proceedings at Meetings of Members “ 6.3 defines a quorum as at least three voting members "personally present" - How about more than half the directors and more than 20% of non-director members? That way it scales if we grow, and an unrepresentative small number of members can't change things.

I agree but would only refer to members (not directors) – so must I change the clause to something like “at least 3 members or 20% of the members (whichever number is greater)…”?

13

6.4: This allows 1 person to be a quorum.

Yes.

14

6.9 - does this also count for, for example, electronic resolutions?

In my opinion, yes – but again, we can spell it out expressly if wanted.

15

Votes of members: 7.3 - does this also include electronically? (for example an email originating from a registered email address to both the secretary and the representant) Effeietsanders 14:39, 5 October 2010 (UTC)

In my opinion, yes – but we can spell it out expressly if wanted. I can also change the phrase “under the hand of” if this phrase causes discomfort.

16

7.3 - deletion: I changed "...and take part in the meetings and proceedings of the company or companies generally, whether or not he himself/ she herself is a member of the company generally." to read "and take part in the meetings and proceedings of the company generally." - "whether or not" doesn't specify anything useful - no-one would presume that a member wouldn't be able to act under a power of attorney, surely? Also, we're not defining multiple companies here, so we can keep it singular. If this was a mistake for some specific legal reason, please explain! --Slashme 16:05, 14 November 2010 (UTC)

I suggest using the original version. It may appear superfluous; however, the section is entitled “votes of members” and the last part contains some sort of exception according to which someone can vote in spite of not being a member - and the “whether or not” part makes this clear.

17

7.4 - "in default the form of proxy shall not be treated as valid." What does this mean? --Slashme 07:36, 13 November 2010 (UTC)

It means that if the requirements mentioned before are not fulfilled, the form appointing a proxy is invalid.

18

In a similar vein, what constitutes a "casual vacancy" under 8.4? --Slashme 07:44, 13 November 2010 (UTC) - I think it means that should there be a lack of directors, the directors present may fill the spot with any other member to act as a director. LouriePieterse 20:50, 23 November 2010 (UTC)

“Casual” is another word for occasional here, ie something that happens every now and then only.

19

MoA powers (5), 9.1, 9.2 and 12.2 - remuneration - I am not sure how this works out in practice, and I am a bit confused how this overlaps with the way chapters usually work. It sounds like it is possible that directors receive pay, and that this pay is determined by the directors. This sounds very tricky. I would like to suggest that this pay is limited to only the made costs while functioning as a director for the association, and that any further payment (salery) would have to be agreed upon by the general meeting of members. Effeietsanders 14:39, 5 October 2010 (UTC) – I agree. Directors should only be allowed to receive money to cover chapter related costs. If we remove point 12.2, would it then read the right way? I think we should leave point 9.2, because it may be required to cover other than the general (traveling and accommodation) costs for a certain director. LouriePieterse 14:13, 7 November 2010 (UTC) - I agree. Anyone who gets a salary from the chapter would in my mind be admin staff, not an MD. --Slashme 07:49, 13 November 2010 (UTC) - I changed the point as David suggested. Does it read correctly? LouriePieterse - I've made a change to indicate that they can appoint admin staff instead of saying that they can appoint one of the directors as admin staff. It might be that a director could be given the job, but it might as easily just be a student, a secretary or a manager who responds to a job offer. --Slashme 08:13, 24 November 2010 (UTC)

I can obviously not decide whether you want directors to be paid or not. This said, please take into account that directors do spend significant time on running the company – and should all this really be done for free? Also, by becoming directors, people accept quite some degree of legal responsibility – especially if something goes wrong. Perhaps taking such risk should also be rewarded? Why should admin staff be paid and directors should not? As for directors deciding on their own salaries, well they sort of have a legal obligation to not overcharge – but it is a risk. A solution to this problem could be to let directors suggest a director salary for the year ahead at the Annual General Meeting and this then needs to be approved by the members? This I guess is pretty much in line with what Effeietsanders suggests.

I am not sure why you made the admin staff / managing director changes. Obviously, directors can employ admin staff – but 12 (2) introduced the possibility for directors to make one of their own a Managing Director, a position quite commonly created by companies (a bit like a CEO). Should we not have such position?

20

13.1 - When a director deceases, the membership still will remain active, will the directorate also go to the executor? (doesnt sound like appropriate) Effeietsanders 14:39, 5 October 2010 (UTC) - Good point, we need a legal opinion on whether we need to explicitly exclude this or whether it's covered in some sense already. --Slashme 08:16, 13 November 2010 (UTC)

No, the directorate does not go to the executor. This is one of the cases in which we speak of “casual vacancy” (see above).

21

14.8.1 - does this also include electronic signatures, such as on a wiki? Effeietsanders 14:39, 5 October 2010 (UTC) - I guess this depends on what is "legally recognized". If electronic communication isn't legally recognized, we might want to specify a different criterion. --Slashme 08:35, 13 November 2010 (UTC) - I don't think wiki signatures is regarded as legal. What does other institutions do? LouriePieterse 19:35, 23 November 2010 (UTC)

The ECT Act recognises electronic signatures and defines these as “data attached to, incorporated in, or logically associated with other data and which is intended by the user to serve as a signature”. On this basis, it appears that wiki signatures are sufficient. Is this what you want or do you want to require, for instance, so-called advanced electronic signatures when dealing with electronic resolutions.

22

If I am correct, there is no mention of a treasurer or secretary. Is this correct? Effeietsanders 14:39, 5 October 2010 (UTC) - I find the constitution a bit confusing, but I think for the 3 quorum directors the roles are divided into: Chair(wo)man, Treasurer and Secretary. ArieScheurwater 20:15, 21 October 2010 (UTC) - That doesn't seem to me to be the correct interpretation: any 3 directors can form a quorum, and the specific roles of the directors (e.g. secretary, treasurer etc.) would probably be for the whole term of the director. These roles aren't specified in this document, however - they could probably be decided at the first directors' meeting. --Slashme 16:38, 14 November 2010 (UTC) – I agree with David on this. I don't know if this is legally required, but I feel that if it's not needed to mention this, then there is no need to do so. Not mentioning this will make this documents also simpler. The directors can sort the different duties out at the first meeting, as mentioned by David. I believe we need a legal opinion on this. LouriePieterse 19:39, 23 November 2010 (UTC)

While ‘public companies with a share capital’ are obliged to have a company secretary, companies limited by guarantee (incl sec 21 companies) are not. Nor is there a requirement to have a treasurer. This, however, does not mean that such positions cannot be created – but it does not need to be part of these documents.

23

16.1 and 16.5 What is the reference to members being "entitled to shares" about? 12.1 also talks about shareholders and 7.5 talks about transfer of shares. Does a non-profit have shareholders? --Slashme 18:31, 14 November 2010 (UTC)

No, a section 21 company does not have share capital and all references to shares and shareholders can therefore be deleted or, if necessary , be changed to “members”

24

This article does not state who takes the decision to wind up. To me it would be normal to let that be the general meeting of members. Clarification would be helpful. Effeietsanders 14:39, 5 October 2010 (UTC) - Normally this is done with a vote from the members. --Arie Scheurwater - A normal vote, or a supermajority vote? I guess it is good to define this clearly. Effeietsanders 14:43, 7 December 2010 (UTC)

In certain circumstances, a company may be wound up by the court. This said, I believe your question regards a voluntary winding-up. At this point in time courts seem to disagree whether the law gives directors the power to decide on winding up a company or not. For this reason, the current version of the articles expressly allows this (sec 12.1). However, if this is not what you want, it can easily be changed so that only members can decide to voluntarily wind up the company.

Memorandum of Association

1

“The word community is a bit confusing to me. Are you referring to the general audience or the community of editors? Also you seem to limit yourself to South Africans. Is this on purpose, or would it be wise to make it "for everybody human being"? Although the name does not include that word, you use the word "chapter" in your purpose. Just use the official name there? Effeietsanders 14:52, 5 October 2010 (UTC)”

Is this question aimed at me?