February 2021 – Charities and Virtual Meetings

Author: Mitchells Roberton
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  • The Scottish Charity Regulator (“OSCR”) oversees charities in Scotland. It regularly publishes bulletins on its website. This month’s bulletin included the question: “Does your governing document allow for virtual meetings?”
  • The background to that question is that a charity must have a “governing document” or “constitution” setting out how it came into being, what its purposes are and how it is to be run.
  • The governing document will generally include provisions about when and how those in charge of the charity should meet to discuss the charity’s affairs and take decisions about the charity. Where the charity is one which also has members it will include provisions about when and how the members should meet to discuss matters and take membership decisions.
  • The governing document may provide, expressly or by necessary implication, that those meetings are to be “face-to-face” meetings where those concerned are all physically present together in the same place. Or it may provide, expressly or by necessary implication, that there is no need for physical attendance but that meetings may be held virtually – for example, by Zoom.
  • This of course has been of significance during the Covid pandemic where face-to-face meetings have not generally been permitted. For example, if the governing document of a charity says there must be a physical face to face meeting on a particular date each year, or in order to decide on some particular question concerning the charity, what happens when the Coronavirus restrictions make that impossible?
  • Specific legislation (see schedule 14, Corporate Insolvency and Governance Act 2020) was passed allowing many charities to hold virtual members’ meetings where face-to-face meetings were not possible. This legislation runs until 30 March 2021, but is not going to be extended further. Hence OSCR’s bulletin this month alerting charities to that fact as follows:

“If you are going to need to alter your governing document to allow for virtual meetings, then now is the time to make the relevant changes.

It doesn’t matter whether your charity is a company, a [Scottish Charitable Incorporated Organisation], an unincorporated organisation or anything else. Having the ‘virtual’ provision there can only be a good thing in terms of the resilience of your charity going forwards.”

  • The governing document of most charities will include provisions allowing it to be altered and setting out the procedures for making any alterations. If however there is no power to alter the terms of the governing document then one may make an application to OSCR seeking its consent to alter the governing document so as to provide for a particular alteration and so as to include a general power to alter it again in the future should that prove necessary.
  • Of course it may not always be that easy to decide whether a charity’s governing document does or does not allow for “virtual meetings”. It can be argued however that if a charity’s governing document is a reasonably modern one then unless there is something in the governing document imposing a requirement – either expressly or by necessary implication – for face-to-face meetings it should follow that “virtual meetings” as well as face-to-face meetings are both permitted.
  • That view is largely based on a 1990 case (Byng v London Life Association Ltd. and Another [1990] Ch 170 at 182 per Sir Nicolas Browne-Wilkinson V-C)  where it was said (emphasis added):

“[the submission was made]  that a ‘meeting’ for the purpose of the Companies Act 1985 requires that everyone shall be physically present in the same room or space. I do not accept this submission. The rationale behind the requirement for meetings in the Companies Act 1985 is that the members shall be able to attend in person so as to debate and vote on matters affecting the company. Until recently this could only be achieved by everyone being physically present in the same room face to face. Given modern technological advances, the same result can now be achieved without all the members coming face to face: without being physically in the same room they can be electronically in each other’s presence so as to hear and be heard and to see and be seen.”

  • Those observations relate to company law – specifically the Companies Act 1985 – rather than charity law. But one would expect the same principle to apply to both.
  • Nevertheless, those in charge of charities will generally want to have the matter spelled out in their governing document so they know just where they are in relation to holding meetings virtually.

Note: This material is for information purposes only and does not constitute any form of advice or recommendation by us. You should not rely upon it in making any decisions or taking or refraining from taking any action. If you would like us to advise you on any of the matters covered in this material, please contact Lauren Booth: email Lauren@mitchells-roberton.co.uk

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