The Importance of In-Person Meetings

We live in a world where almost everything is automated; our communications are no different. Sending an email or text message has become more common than picking up a phone or driving somewhere for an actual conversation. In many cases, we’ve come to rely on 140-character or less methods of sharing information and have nearly abandoned the formalities of the past.

While this can make businesses run smoother than ever, it can also make it easy to shortcut certain formalities that are still necessary. Meetings where a vote is required fall into this category as far as the law is concerned.

When a contract or issue that would traditionally require a consensus or formal vote is required, the easy route could be to send out an e-mail asking for each person to weigh in on the issue, especially if a unanimous yes or no is expected. The ease of this process makes it even more appealing, but, is it covered under law?

The answer, while surprising to some business owners and board members, is a simple, clear-cut, “no.”

While there’s no penalty for hosting a vote through e-mail, it is not enforceable or covered under law. While many business owners assume that, because e-mails are recorded and can be saved they count as an actual meeting. This is not the case.

Under law, non-profit and profit boards and committees cannot act by correspondence, only by a physical meeting or by unanimous written consent (whereby emails could count if the entire board agrees that this qualifies in advance, the vote is unanimous and if each email is printed and saved with hardcopy meeting minutes). Meetings are defined as events where each person can be heard simultaneously (it’s important to note that phone conferences are likely legally enforceable under this definition).

Bottom line: votes taken when boards are not physically present may be considered nothing more than an “informal action” which is not legally valid.

Unsure of whether the activities of your corporation or non-profit’s board are legally enforceable? Want to talk with an experienced business law attorney who can provide guidance while answering relevant legal questions? Contact Attorney Michael Hynum with Hynum Law in Harrisburg, PA today to set up a consultation. We look forward to working with you.