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Here, as promised, is Diane Cabell's comments and advice about our draft MoA and AoA.
Diane Cabell wrote about the MoA:
James,
Here are some initial thoughts on the memorandum.
- Unlike commercial corporations, charities do not have to include the
term "Limited" in their name, but it does require a special approval process which might take longer. I would suggest you insert the full name as "Wiki Educational Resources Ltd." if time is of the essence.
- The objects you describe in Sec. 3 are not "exclusively charitable"
and could be rejected. In other words, a commercial enterprise might adopt these same objects. You need to include some language that shows how you operate on a charitable basis. See
http://www.charity-commission.gov.uk/registration/exobjintro.asp
Also, "campaign" is a loaded term and could be interpreted to include impermissible political activities. Generally, charities can't support political candidates although they are often permitted to engage in legislative work, so one needs to be cautious about this.
Here are the objects that I would suggest for Sec. 3:
"to advance the education of the general public worldwide by (a) publishing a free, publicly-accessible encyclopedia and other information resources via the internet and in other media; (b) publishing other informational and educational materials at no cost or at no profit; and (c) encouraging the adoption of practices and policies that reduce the cost of education by utilizing volunteer public participation in the creation, dissemination and expansion of informational material."
I can't assure you that this language will be approved either, but it is less likely to raise red flags. One is allowed great leeway in conducting activities that promote one's objects, so it isn't necessary to get too detailed here.
- Sec. 4(a)(x) should be amended to read as below. The last clause
should qualify A, B and C; your version uses it only to qualify C.
"(x) to: (A) deposit or invest funds; (B) employ a professional fund-manager; and (C) arrange for the investments or other property of the Charity to be held in the name of a nominee;
in the same manner and subject to the same conditions as the trustees of a trust are permitted to do by the Trustee Act 2000."
- One doesn't cite to a "Sub-sub-clause;" one merely cites to a
"sub-clause".
- If you are going to add references to overseas organizations in some
clauses [as you do in Sec. 4(a)(vi)], you should add it to all similar references throughout the document; otherwise, the law would presume you intended to restrict those other clauses to UK domestic activity. See Sec. 8 for example, which determines where the assets may be distributed if the company is dissolved.
I'll send another email about the Articles. If you have any questions at all, don't hesitate to ask.
... and this about the AoA:
- Sec. 9(b) -- needs editing as it repeats itself on the succeeding
page.
This should be a simple either/or choice between two options: either X% of the membership or Y members, whichever is greater (or lesser, as you prefer).
75% is a very high quorum. The members must meet annually and are required to take certain mandatory actions. If the membership is large, failure to meet the 75% minimum attendance could keep you from holding the meeting even after 74% of the members have made the effort to show up. This can actually become a tool to disrupt the company. Generally a simple majority or less is sufficient for a quorum. If the membership is very small, say fewer than 10, then 75% may be totally appropriate, but in this day and age it may be hard to get even that small a number together for a meeting.
I'd suggest the following: "A quorum is: . a majority of the members entitled to vote upon the business to be conducted at the meeting; or . one tenth of the total membership at the time whichever is the greater."
You may, as a separate matter, require the vote of a supermajority to pass any resolution at the meeting. A simple majority vote is required for votes at meetings of the directors [See Sec. 33(e)]. You may wish to add a mirror of 33(e) to Sec. 16. You can adjust Sec. 16's voting requirement to 75% but bear in mind that a supermajority requirement can often result in a frozen corporation unable to muster enough votes to take action. While you may want broad support for some types of votes, you certainly don't want to be held up on more mundane activities.
- Sec. 9(d) and (e)
It is generally risky to condition the corporation's activities on the presence of any single individual. A dissatisfied (or ailing) Treasurer could simply fail to appear and hold up all the proceedings, even those that don't affect the budget (such as election of officers, appointment of additional directors, amendment of bylaws, etc.). The directors have all the rights and obligations of a treasurer. They may delegate these to an officer, if they choose. Generally, it is accomplished by enacting a set of bye laws for the corporation that specifies the titles of the officers and their duties and empowers each as appropriate. The members of the corporation, on the other hand, are not generally responsible for the day-to-day operations of the company and you don't want to hold up those activities until the membership (often a very large class of individuals) holds its meeting.
Instead of requiring the physical presence of a Treasurer, or allowing one individual to hold up the proceedings of the corporation, it might be more appropriate to enact a bye law that sets objective standards for voting on budgetary items. For example, requiring that any vote having a direct effect on expenditures should, _where possible_, be reviewed and reported on by the Treasurer in advance. See Sec. 38(b) as an example of objective language. The law requires the Directors to take certain actions by certain dates (including filing annual reports with Companies House and the Charity Commission and, of course, filing tax returns), so it would be risky to make that review mandatory. Otherwise the company might be in violation of the law because a disgruntled Treasurer doesn't want to cooperate. Sec. 34(a) and (d) present the same problem.
Note: If you intend to open a UK bank account, the directors will need to delegate the authority to do so to some specific individual. The bank may require that the resolution contain particular language and name the specific individual. Check with your bank first.
- 10(a)
The final clause should not be merged into sub-section (ii). It should qualify both (i) and (ii), so insert a line space after the word "present;":
- 11(a) doesn't make sense to me.
The Charity Commission template uses the simple statement "General meetings shall be chaired by the person who has been appointed to chair meetings of the Directors."
Note: Directors are not necessarily members of the company unless you require this elsewhere in the document. The UK concept of a charity is that the directors are the trustees who act to direct a operations that, in turn, benefit the membership. An example is a bunch of fat cats who decide that the world needs another soup kitchen for the deserving poor. The fat cats are generally the directors/trustees and the deserving poor are generally the members. The rights of the members of a charity are more limited than those of a commercial share-holder organization.The reason is that the directors are responsible for funding the operation and may decide, if they see fit, to change the beneficiaries of their operations (perhaps turn it into a library if they decide that the deserving poor are getting too fat). Even for shareholder organizations, the members generally have very few powers over daily operations.
- Sec. 15 permits membership votes without a face-to-face meeting as
does Sec. 37 for meetings of directors. Very handy. You may wish to add (either in this section or in a new clause at the end of the document) that electronic and facsimile signatures shall be considered as valid signatures wherever signatures are required by the Articles. This would allow you to get faxed copies when you want to take a vote without holding a general meeting. The downside is that the signatures are easier to forge, so it may be a tough choice. Where the membership and directors are few and well-known to each other, electronic sigs are pretty safe.
Sec. 34(a) and (d) - see earlier comments about the Treasurer.
The Articles require signatures. See page 24 of the template at
http://www.charity-commission.gov.uk/ Library/publications/pdfs/gd1text.pdf.
As always, I'm happy to answer any questions or clarify obtuse comments. Let me know if you'd like to chat about it.
Obviously, there are some changes suggested here that we may not agree with (the change in spirit of them, etc., perhaps), but I thought that, rather that try to work out all of them on my own, I'd put them here so that we can all try to deal with the necessary changes together.
Yours sincerely, - -- James D. Forrester Wikimedia : [[W:en:User:Jdforrester|James F.]] E-Mail : james@jdforrester.org IM (MSN) : jamesdforrester@hotmail.com
James D. Forrester wrote:
Here, as promised, is Diane Cabell's comments and advice about our draft MoA and AoA.
- The objects you describe in Sec. 3 are not "exclusively charitable"
and could be rejected. In other words, a commercial enterprise might adopt these same objects. You need to include some language that shows how you operate on a charitable basis. See http://www.charity-commission.gov.uk/registration/exobjintro.asp Also, "campaign" is a loaded term and could be interpreted to include impermissible political activities. Generally, charities can't support political candidates although they are often permitted to engage in legislative work, so one needs to be cautious about this.
ah, ok.
Here are the objects that I would suggest for Sec. 3: "to advance the education of the general public worldwide by (a) publishing a free, publicly-accessible encyclopedia and other information resources via the internet and in other media;
We are, of course, not actually going to be doing anything of the sort! At least not so far in our plans.
"Furthering" such? I suppose we'd have to ask again ...
(b) publishing other informational and educational materials at no cost or at no profit; and
Hmm ...
(c) encouraging the adoption of practices and policies that reduce the cost of education by utilizing volunteer public participation in the creation, dissemination and expansion of informational material."
Absolutely.
I can't assure you that this language will be approved either, but it is
Of course!
less likely to raise red flags. One is allowed great leeway in conducting activities that promote one's objects, so it isn't necessary to get too detailed here.
Good :-)
- If you are going to add references to overseas organizations in some
clauses [as you do in Sec. 4(a)(vi)], you should add it to all similar references throughout the document; otherwise, the law would presume you intended to restrict those other clauses to UK domestic activity. See Sec. 8 for example, which determines where the assets may be distributed if the company is dissolved.
I would have thought we'd have to distribute assets in case of dissolution within the UK ...
Generally a simple majority or less is sufficient for a quorum. If the membership is very small, say fewer than 10, then 75% may be totally appropriate, but in this day and age it may be hard to get even that small a number together for a meeting.
Sounds good.
. a majority of the members entitled to vote upon the business to be conducted at the meeting; or . one tenth of the total membership at the time whichever is the greater."
Should be okay.
Note: If you intend to open a UK bank account, the directors will need to delegate the authority to do so to some specific individual. The bank may require that the resolution contain particular language and name the specific individual. Check with your bank first.
Ooh hmm.
- Sec. 15 permits membership votes without a face-to-face meeting as
does Sec. 37 for meetings of directors. Very handy. You may wish to add (either in this section or in a new clause at the end of the document) that electronic and facsimile signatures shall be considered as valid signatures wherever signatures are required by the Articles.
Can we all work PGP? (e.g. Thunderbird with Enigmail is pretty usable.)
This would allow you to get faxed copies when you want to take a vote without holding a general meeting. The downside is that the signatures are easier to forge, so it may be a tough choice. Where the membership and directors are few and well-known to each other, electronic sigs are pretty safe.
I have no idea if anyone has tested the legal status of digital signatures in the UK, of course.
- d.
Obviously, there are some changes suggested here that we may not agree with (the change in spirit of them, etc., perhaps), but I thought that, rather that try to work out all of them on my own, I'd put them here so that we can all try to deal with the necessary changes together.
Yours sincerely,
James D. Forrester Wikimedia : [[W:en:User:Jdforrester|James F.]] E-Mail : james@jdforrester.org IM (MSN) : jamesdforrester@hotmail.com
Face to face? Or by email?
On 20/12/05, David Gerard fun@thingy.apana.org.au wrote:
I have no idea if anyone has tested the legal status of digital signatures in the UK, of course.
In theory they are fine. See: http://en.wikipedia.org/wiki/Electronic_Communications_Act_2000
Faxed signatures on the other hand are on far iffier ground as well as their forgeability. I would suggest that we do not allow them. To my mind fax technology is completely outdated and should be consigned to the history books along with telegraphs and telexs. I can't forsee anyone involved in the organisation not having access to a computer for electronic signatures.
-- James Hardy (MrWeeble)
At 20:27 +0000 20/12/05, James D. Forrester wrote:
Here, as promised, is Diane Cabell's comments and advice about our draft MoA and AoA.
These are very detailed; please thank Diane for her work. My recollection was that much of the wording was from the drafts as supplied by the charities commission, and I am surprised at some of the changes.
I would like to suggest that Diane Cabell attends a physical meeting, or that we have an IRC meeting to go through the documents again, line by line.
It's good to have Diane's comments. May I echo Gordon's request that our thanks be passed onto her.
My reading of the comments is that I have no problem with any of the proposed amendments except for the Objects - and then on the factual grounds that David has already highlighted that we will not actually be publishing anything ourselves. Maybe "Encouraging the publication of..." would be a better phrase?
Also, I am tempted to apply to not have "Ltd" in the name straightaway. In practice we're not going to be up and running as a registered charity until the middle of next year, I guess, and a few days' additional delay is no concern. Indeed, if Companies House was concerned about us using Ltd then I can't see us getting passed the Charity Commission.
Once amendments have been tweaked, I think we can put the things together that we need to incorporate. We'll soon need another meeting - maybe IRC over the Christmas break, or face-to-face in the New Year, to tidy things up, get things signed (for which we also need a solicitor), and start putting things together for the Charity Commission. I'm also wondering how many of the GBP donations of future WM fundraisers would come to Wiki Educational Resources!
All the best
Jon
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On 12/22/05, Jon thagudearbh@yahoo.co.uk wrote:
My reading of the comments is that I have no problem with any of the proposed amendments except for the Objects - and then on the factual grounds that David has already highlighted that we will not actually be publishing anything ourselves. Maybe "Encouraging the publication of..." would be a better phrase?
Would we not be publishing Wikireaders and such? Surely that would be us and not the Wikimedia Foundation (or another interested party).
Cormac
Cormac Lawler wrote:
On 12/22/05, Jon thagudearbh@yahoo.co.uk wrote:
My reading of the comments is that I have no problem with any of the proposed amendments except for the Objects - and then on the factual grounds that David has already highlighted that we will not actually be publishing anything ourselves. Maybe "Encouraging the publication of..." would be a better phrase?
Would we not be publishing Wikireaders and such? Surely that would be us and not the Wikimedia Foundation (or another interested party).
I don't think it is sensible for chapters to be directly involved in publishing Wikireaders. This is a subtle point, but chapters may in some cases be involved in trademark licensing issues (the Germans are, for example) related to publishing, but this is a far cry from doing publishing ourselves, either as a chapter or as the foundation.
--Jimbo
Jimmy Wales wrote:
I don't think it is sensible for chapters to be directly involved in publishing Wikireaders. This is a subtle point, but chapters may in some cases be involved in trademark licensing issues (the Germans are, for example) related to publishing, but this is a far cry from doing publishing ourselves, either as a chapter or as the foundation.
Mmm. Even the de: DVDs are published by an outside commercial company, who quite sensibly set up a structure so the usual de: volunteer editors could do the work they needed while clearly also improving the encyclopedia.
Jimbo, has anyone sniffed around en: with a plan to do a DVD, in the wake of the moderate success of the de: DVDs?
- d.
On 12/24/05, David Gerard fun@thingy.apana.org.au wrote:
Jimmy Wales wrote:
I don't think it is sensible for chapters to be directly involved in publishing Wikireaders. This is a subtle point, but chapters may in some cases be involved in trademark licensing issues (the Germans are, for example) related to publishing, but this is a far cry from doing publishing ourselves, either as a chapter or as the foundation.
Mmm. Even the de: DVDs are published by an outside commercial company, who quite sensibly set up a structure so the usual de: volunteer editors could do the work they needed while clearly also improving the encyclopedia.
Jimbo, has anyone sniffed around en: with a plan to do a DVD, in the wake of the moderate success of the de: DVDs?
I don't think publishing (anything) needs to be one of our main objects, but it would be foolish to prevent ourselves from doing so. It is very important to avoid having to change the MoA after we incorporate.
Andreww
At 22:20 +0000 24/12/05, Andrew Walker wrote:
On 12/24/05, David Gerard fun@thingy.apana.org.au wrote:
Jimmy Wales wrote:
I don't think it is sensible for chapters to be directly involved in publishing Wikireaders. This is a subtle point, but chapters may in some cases be involved in trademark licensing issues (the Germans are, for example) related to publishing, but this is a far cry from doing publishing ourselves, either as a chapter or as the foundation.
Mmm. Even the de: DVDs are published by an outside commercial company, who quite sensibly set up a structure so the usual de: volunteer editors could do the work they needed while clearly also improving the encyclopedia.
Jimbo, has anyone sniffed around en: with a plan to do a DVD, in the wake of the moderate success of the de: DVDs?
I don't think publishing (anything) needs to be one of our main objects, but it would be foolish to prevent ourselves from doing so. It is very important to avoid having to change the MoA after we incorporate.
Andreww
Which is why very wide open objects, which are succinct, are the best.
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This reply has been sitting in my drafts folder, three-quarters done, for a fortnight now; my apologies.
James D. Forrester wrote:
Diane Cabell wrote about the MoA:
James,
Here are some initial thoughts on the memorandum.
- Unlike commercial corporations, charities do not have to
include the term "Limited" in their name, but it does require a special approval process which might take longer. I would suggest you insert the full name as "Wiki Educational Resources Ltd." if time is of the essence.
I don't think this applies (we're not in a dreadful hurry - if we were, we'd have finished this two years ago when we were originally discussing founding Wikimedia UK).
- The objects you describe in Sec. 3 are not "exclusively
charitable" and could be rejected. In other words, a commercial enterprise might adopt these same objects. You need to include some language that shows how you operate on a charitable basis. See
http://www.charity-commission.gov.uk/registration/exobjintro.asp
Also, "campaign" is a loaded term and could be interpreted to include impermissible political activities. Generally, charities can't support political candidates although they are often permitted to engage in legislative work, so one needs to be cautious about this.
Here are the objects that I would suggest for Sec. 3:
"to advance the education of the general public worldwide by (a) publishing a free, publicly-accessible encyclopedia and other information resources via the internet and in other media; (b) publishing other informational and educational materials at no cost or at no profit; and (c) encouraging the adoption of practices and policies that reduce the cost of education by utilizing volunteer public participation in the creation, dissemination and expansion of informational material."
I can't assure you that this language will be approved either, but it is less likely to raise red flags. One is allowed great leeway in conducting activities that promote one's objects, so it isn't necessary to get too detailed here.
I'm not sure about these different Objects, so I'll post-pone their updating.
- Sec. 4(a)(x) should be amended to read as below. The last
clause should qualify A, B and C; your version uses it only to qualify C.
"(x) to: (A) deposit or invest funds; (B) employ a professional fund-manager; and (C) arrange for the investments or other property of the Charity to be held in the name of a nominee;
in the same manner and subject to the same conditions as the trustees of a trust are permitted to do by the Trustee Act 2000."
Ah, whoops, a mistake in my formatting. Fixed.
- One doesn't cite to a "Sub-sub-clause;" one merely cites to a
"sub-clause".
Right-o. Even if it is rather imprecise. :-)
- If you are going to add references to overseas organizations in
some clauses [as you do in Sec. 4(a)(vi)], you should add it to all similar references throughout the document; otherwise, the law would presume you intended to restrict those other clauses to UK domestic activity. See Sec. 8 for example, which determines where the assets may be distributed if the company is dissolved.
Updated to include "[...], based either in the United Kingdom or elsewhere,[...]" (though, as discussed, it may raise difficulties with the Commission).
[Snip]
... and this about the AoA:
- Sec. 9(b) -- needs editing as it repeats itself on the
succeeding page.
This should be a simple either/or choice between two options: either X% of the membership or Y members, whichever is greater (or lesser, as you prefer).
75% is a very high quorum. The members must meet annually and are required to take certain mandatory actions. If the membership is large, failure to meet the 75% minimum attendance could keep you from holding the meeting even after 74% of the members have made the effort to show up. This can actually become a tool to disrupt the company. Generally a simple majority or less is sufficient for a quorum. If the membership is very small, say fewer than 10, then 75% may be totally appropriate, but in this day and age it may be hard to get even that small a number together for a meeting.
I'd suggest the following: "A quorum is: . a majority of the members entitled to vote upon the business to be conducted at the meeting; or . one tenth of the total membership at the time whichever is the greater."
I've changed it to:
| A quorum is: | | * a majority of the members entitled to vote upon the business to be | conducted at the meeting; or | * one tenth of the total membership at the time | | whichever is the lesser.
Which is, I feel, clear enough, and along the lines of what we have agreed would be appropriate.
You may, as a separate matter, require the vote of a supermajority to pass any resolution at the meeting. A simple majority vote is required for votes at meetings of the directors [See Sec. 33(e)]. You may wish to add a mirror of 33(e) to Sec. 16. You can adjust Sec. 16's voting requirement to 75% but bear in mind that a supermajority requirement can often result in a frozen corporation unable to muster enough votes to take action. While you may want broad support for some types of votes, you certainly don't want to be held up on more mundane activities.
Possibly. Thoughts, anyone? I'm not wholly enamoured with the idea, personally.
- Sec. 9(d) and (e)
It is generally risky to condition the corporation's activities on the presence of any single individual. A dissatisfied (or ailing) Treasurer could simply fail to appear and hold up all the proceedings, even those that don't affect the budget (such as election of officers, appointment of additional directors, amendment of bylaws, etc.). The directors have all the rights and obligations of a treasurer. They may delegate these to an officer, if they choose. Generally, it is accomplished by enacting a set of bye laws for the corporation that specifies the titles of the officers and their duties and empowers each as appropriate. The members of the corporation, on the other hand, are not generally responsible for the day-to-day operations of the company and you don't want to hold up those activities until the membership (often a very large class of individuals) holds its meeting.
Instead of requiring the physical presence of a Treasurer, or allowing one individual to hold up the proceedings of the corporation, it might be more appropriate to enact a bye law that sets objective standards for voting on budgetary items. For example, requiring that any vote having a direct effect on expenditures should, _where possible_, be reviewed and reported on by the Treasurer in advance. See Sec. 38(b) as an example of objective language. The law requires the Directors to take certain actions by certain dates (including filing annual reports with Companies House and the Charity Commission and, of course, filing tax returns), so it would be risky to make that review mandatory. Otherwise the company might be in violation of the law because a disgruntled Treasurer doesn't want to cooperate. Sec. 34(a) and (d) present the same problem.
Possibly. The thing is, a great deal of the point behind Wikimedia UK is to raise money for grants to give organisations for charitable purposes (the Wikimedia Foundation would likely be the main beneficiary, yes, but certainly not the only one), and in such circumstances, the Treasurer is going to be absolutely vital; as we're quite a geographically spread-out organisation, it would be very hard to have the entirety of the Directors all "in the loop" 100% on every detail at every moment, whereas a Treasurer would necessarily be involved in everything of that sort, and so be a final authority.
How about adding something to Clause 31 saying that any Director can be removed by the rest of the Directors in a vote in a DM? That would allow unhelpful Treasurers to be replaced quite easily.
Note: If you intend to open a UK bank account, the directors will need to delegate the authority to do so to some specific individual. The bank may require that the resolution contain particular language and name the specific individual. Check with your bank first.
The resolution would be post-creation of the company, though, so I assume we wouldn't need to fix this until then; we'd make any necessary changes before submitting to the Commission, though, so it shouldn't be a problem.
- 10(a)
The final clause should not be merged into sub-section (ii). It should qualify both (i) and (ii), so insert a line space after the word "present;":
Another mistake in my formatting. Sorry. Fixed.
- 11(a) doesn't make sense to me.
The Charity Commission template uses the simple statement "General meetings shall be chaired by the person who has been appointed to chair meetings of the Directors."
Note: Directors are not necessarily members of the company unless you require this elsewhere in the document. The UK concept of a charity is that the directors are the trustees who act to direct a operations that, in turn, benefit the membership. An example is a bunch of fat cats who decide that the world needs another soup kitchen for the deserving poor. The fat cats are generally the directors/trustees and the deserving poor are generally the members. The rights of the members of a charity are more limited than those of a commercial share-holder organization. The reason is that the directors are responsible for funding the operation and may decide, if they see fit, to change the beneficiaries of their operations (perhaps turn it into a library if they decide that the deserving poor are getting too fat). Even for shareholder organizations, the members generally have very few powers over daily operations.
I have no problem with it - GMs are chaired either by the Director who chairs DMs, or a Member who the Directors have chosen so to do. It's simple enough.
We might want to add something about Directors having to also be Members, though, yes; 31(c) implies it, of course ("A Director shall cease to hold office if he [...] ceases to be a member of the Company").
- Sec. 15 permits membership votes without a face-to-face meeting as
does Sec. 37 for meetings of directors. Very handy. You may wish to add (either in this section or in a new clause at the end of the document) that electronic and facsimile signatures shall be considered as valid signatures wherever signatures are required by the Articles. This would allow you to get faxed copies when you want to take a vote without holding a general meeting. The downside is that the signatures are easier to forge, so it may be a tough choice. Where the membership and directors are few and well-known to each other, electronic sigs are pretty safe.
Electronic signatures as specified as legally binding under UK law are quite (read: very) complicated, and, as discussed, I don't think we want fax signatures to be used. What are others' opinions?
[Snip more stuff about the Treasurer position, answered above.]
- The Articles require signatures. See page 24 of the template at
http://www.charity-commission.gov.uk/ Library/publications/pdfs/gd1text.pdf.
Ah, yes, forgot that part when duplicating the style of the MoA. Added.
- -- James D. Forrester Wikimedia : [[W:en:User:Jdforrester|James F.]] E-Mail : james@jdforrester.org IM (MSN) : jamesdforrester@hotmail.com
On Mon, 2 Jan 2006, James D. Forrester wrote:
Instead of requiring the physical presence of a Treasurer, or allowing one individual to hold up the proceedings of the corporation, it might be more appropriate to enact a bye law that sets objective standards for voting on budgetary items. For example, requiring that any vote having a direct effect on expenditures should, _where possible_, be reviewed and reported on by the Treasurer in advance. See Sec. 38(b) as an example of objective language. The law requires the Directors to take certain actions by certain dates (including filing annual reports with Companies House and the Charity Commission and, of course, filing tax returns), so it would be risky to make that review mandatory. Otherwise the company might be in violation of the law because a disgruntled Treasurer doesn't want to cooperate. Sec. 34(a) and (d) present the same problem.
Possibly. The thing is, a great deal of the point behind Wikimedia UK is to raise money for grants to give organisations for charitable purposes (the Wikimedia Foundation would likely be the main beneficiary, yes, but certainly not the only one), and in such circumstances, the Treasurer is going to be absolutely vital; as we're quite a geographically spread-out organisation, it would be very hard to have the entirety of the Directors all "in the loop" 100% on every detail at every moment, whereas a Treasurer would necessarily be involved in everything of that sort, and so be a final authority.
How about adding something to Clause 31 saying that any Director can be removed by the rest of the Directors in a vote in a DM? That would allow unhelpful Treasurers to be replaced quite easily.
Would it not be prudent to add something to allow members to get rid of a director or directors who are going against the aims? Off the top of my head perhaps, (assuming director A is the one they want to remove) - a petetion of <a large number of> members is handed to at least two other directors requiring that the directors call an SGM to vote on whether director A should be removed from their posistion. If this vote is refused then all the directors forfeit their position as directors and the petioning members call the SGM to elect a new set of directors. AND/OR a director can be removed if at least <20 members or 75% of members at a quorate meeting, except were 20 members exceeds 75% of the total members entitled to vote] vote to do so. If any director is removed by this method a further quorate meeting must be held in 2-8 weeks time to vote in a replacement director.
The idea is that members can remove a director without the agreement of the other directors but it takes a lot of effort to do so. Hopefully this allows the members to remove directors that are going against the will of the organisation but makes it very difficult for a faction of the members to take over the organisation. It would need re-wording into official language of course - if we agree we want it.
Electronic signatures as specified as legally binding under UK law are quite (read: very) complicated, and, as discussed, I don't think we want fax signatures to be used. What are others' opinions?
The only benefit to faxed signatures is the speed at which they arrive. For example Defra does not normally use them (but there are exceptions), but they were used extensively during the FMD outbreak. I presume that electronic signatures are the same.
I would suggest that for simplicity we do not allow faxed/electronic signatures under normal circumstances. However, there may be occasions where speedy is of the essence (perhaps to meet the deadline of an external organisation), so we /might/ want to allow them in specific instances. The procedure for allowing them could be as simple as getting the agreement of at least half the directors in a logged IRC meeting to allow them for X project or allow Y member to use them (for Z amount of time). I do not currently participate in IRC (I have never managed to get it working) so I don't know how realistic this would be.
I know this does introduce a bit of complexity, but knowing the way that some charities and grant-making organisations (partiuclarly local authorities) behave when they approach the end of their budget year and find they've been over/under cautious, I feel it would be unwise to rule it out completely. There is also the possibility that in the future electronic signatures could be a less complicated matter.
Above all I think that we need a face-to-face meeting to discuss all of these changes. Someone (Gordon?) was keen to have it either on the 7th/8th or 14th/15th of January so we are not limiting ourselves timewise like we would be before the Birmingham meetup on the 21st.
As the first week back after Christmas for many people is liekly to be hectic and/or stressful (I know mine will be) I suggest that we give people the first weekend to recuperate. So could someone organise a venue for either the 14th or 15th of January in London (as peopel seem to prefer this) - perhaps the meeting room of the Royal Oak again?
Chris
Would it not be prudent to add something to allow members to get rid of a director or directors who are going against the aims?
This is a very tricky area. I know of a charity were the Chair (both a Director and a Trustee) was removed by sending in the relevant form, duly signed by one or more Trustees (or Directors). This was not spotted by the Charity in question for about nine months. Cheques had been signed, meetings convened, all without knowing that the Chair was not longer in post!
Anyway, I believe is the job of Charities Commission to make sure that Trustees are acting within the confines of the Objects. If somebody (inside or outside the Charity has cause for concern, then there must a mechanism for redress.
Hello all
Here's my two-penneth (tax-deductable):
On Monday, January 2, 2006, at 01:35 pm, James D. Forrester wrote:
James D. Forrester wrote:
Diane Cabell wrote about the AoA:
You may, as a separate matter, require the vote of a supermajority to pass any resolution at the meeting. A simple majority vote is required for votes at meetings of the directors [See Sec. 33(e)]. You may wish to add a mirror of 33(e) to Sec. 16. You can adjust Sec. 16's voting requirement to 75% but bear in mind that a supermajority requirement can often result in a frozen corporation unable to muster enough votes to take action. While you may want broad support for some types of votes, you certainly don't want to be held up on more mundane activities.
Possibly. Thoughts, anyone? I'm not wholly enamoured with the idea, personally.
Have it so that the majority of people who can be bothered to turn up to an AGM can make the decisions, approve the accounts etc - ie a simple majority vote of those present.
I'm not too clear on what the membership will be - eg will they just be people who sign up to a mailing list, or promise money to a certain level? In the event that we have many passive/sleeping members, we don't want their inactivity to freeze the company.
- Sec. 9(d) and (e)
It is generally risky to condition the corporation's activities on the presence of any single individual. A dissatisfied (or ailing) Treasurer could simply fail to appear and hold up all the proceedings, even those that don't affect the budget (such as election of officers, appointment of additional directors, amendment of bylaws, etc.). The directors have all the rights and obligations of a treasurer. They may delegate these to an officer, if they choose. Generally, it is accomplished by enacting a set of bye laws for the corporation that specifies the titles of the officers and their duties and empowers each as appropriate. The members of the corporation, on the other hand, are not generally responsible for the day-to-day operations of the company and you don't want to hold up those activities until the membership (often a very large class of individuals) holds its meeting.
Instead of requiring the physical presence of a Treasurer, or allowing one individual to hold up the proceedings of the corporation, it might be more appropriate to enact a bye law that sets objective standards for voting on budgetary items. For example, requiring that any vote having a direct effect on expenditures should, _where possible_, be reviewed and reported on by the Treasurer in advance. See Sec. 38(b) as an example of objective language. The law requires the Directors to take certain actions by certain dates (including filing annual reports with Companies House and the Charity Commission and, of course, filing tax returns), so it would be risky to make that review mandatory. Otherwise the company might be in violation of the law because a disgruntled Treasurer doesn't want to cooperate. Sec. 34(a) and (d) present the same problem.
Possibly. The thing is, a great deal of the point behind Wikimedia UK is to raise money for grants to give organisations for charitable purposes (the Wikimedia Foundation would likely be the main beneficiary, yes, but certainly not the only one), and in such circumstances, the Treasurer is going to be absolutely vital; as we're quite a geographically spread-out organisation, it would be very hard to have the entirety of the Directors all "in the loop" 100% on every detail at every moment, whereas a Treasurer would necessarily be involved in everything of that sort, and so be a final authority.
How about adding something to Clause 31 saying that any Director can be removed by the rest of the Directors in a vote in a DM? That would allow unhelpful Treasurers to be replaced quite easily.
You do not want to be 100% reliant on all decisions being made with one person present. If the Treasurer is the only person of importance, why have anyone else there?
Sorry, I'm being facetious. But if you decide that every meeting has to have the person called the Treasurer there, then it will frustrate you.
In company law and charity law, all directors and all trustees are equally financially liable and responsible for the organisation, whether they label themselves Chair, Treasurer or Honorary Biscuit Officer or whatever. It is a good idea for the trustees/directors to have specific roles, just as in any other team, but in the interest of succession planning and engineering redundancy, its good for there to be some overlap, and some flexibility.
In an Annual General Meeting (which is the most common form of General Meeting this organisation will have), the usual role of a Treasurer is to present the accounts (we spent X, we got in Y, we're doing fine or we're going bankrupt) and call for approval of the accounts by the members (hands up). It is a Good Idea if they are there, but if their train breaks down, or they get stuck in a tube tunnel, or they have a heart attack outside the venue, or.. or... then it is a Good Idea if there is some flexibility to allow the Chair or another to fill in, rather than having to cancel the entire Annual General Meeting (and then having to wait at least 3 weeks for the next one). At the last meeting of Directors before the AGM, the Treasurer should have talked through the accounts with the other Directors, so everyone should have a rough idea of what all the figures mean anyway.
Note: If you intend to open a UK bank account, the directors will need to delegate the authority to do so to some specific individual. The bank may require that the resolution contain particular language and name the specific individual. Check with your bank first.
The resolution would be post-creation of the company, though, so I assume we wouldn't need to fix this until then; we'd make any necessary changes before submitting to the Commission, though, so it shouldn't be a problem.
Some Articles (or Memos, I can't remember which at this hour) have this in their documentation - alternatively this could be stated in the documents that the Directors will create financial procedures for the operation of the company at its first meeting, and these will be published to members.
For charities, it is frequently the case that expenditure authorisation (ie the signing of cheques) is made by two Directors, any two of four [often a named list, eg Treasurer, Chair, Vice-Chair, Vice-Treasurer]. Two of three is common too, but this can make things hairy when one of the signatories leaves and the paperwork to replace them takes ages (I speak from experience).
- 11(a) doesn't make sense to me.
The Charity Commission template uses the simple statement "General meetings shall be chaired by the person who has been appointed to chair meetings of the Directors."
Note: Directors are not necessarily members of the company unless you require this elsewhere in the document. The UK concept of a charity is that the directors are the trustees who act to direct a operations that, in turn, benefit the membership. An example is a bunch of fat cats who decide that the world needs another soup kitchen for the deserving poor. The fat cats are generally the directors/trustees and the deserving poor are generally the members. The rights of the members of a charity are more limited than those of a commercial share-holder organization. The reason is that the directors are responsible for funding the operation and may decide, if they see fit, to change the beneficiaries of their operations (perhaps turn it into a library if they decide that the deserving poor are getting too fat). Even for shareholder organizations, the members generally have very few powers over daily operations.
I have no problem with it - GMs are chaired either by the Director who chairs DMs, or a Member who the Directors have chosen so to do. It's simple enough.
But why would you want this? In almost every organisation, GMs are usually chaired by the Chair of the Board of Trustees/Directors etc or someone similar. If you want it as described in your para above, then the current clause confuses meetings (of Directors) and General meetings. How about:
General meetings shall be chaired by the person who has been appointed to chair meetings of the Directors or the member appointed by the Directors to chair General meetings.
We might want to add something about Directors having to also be Members, though, yes; 31(c) implies it, of course ("A Director shall cease to hold office if he [...] ceases to be a member of the Company").
If Directors are implicitly to be members then it would be good to state this explicitly, checking that that doesn't impact on who we were envisaging would be members and who would be directors.
- Sec. 15 permits membership votes without a face-to-face meeting
as does Sec. 37 for meetings of directors. Very handy. You may wish to add (either in this section or in a new clause at the end of the document) that electronic and facsimile signatures shall be considered as valid signatures wherever signatures are required by the Articles. This would allow you to get faxed copies when you want to take a vote without holding a general meeting. The downside is that the signatures are easier to forge, so it may be a tough choice. Where the membership and directors are few and well-known to each other, electronic sigs are pretty safe.
Electronic signatures as specified as legally binding under UK law are quite (read: very) complicated, and, as discussed, I don't think we want fax signatures to be used. What are others' opinions?
You might wish to clarify with Dianne whether electronic signatures in the context of the UK law stuff, or just as in a signature sent electronically. I'm not sure what the legitimacy of a signature mark sent via fax machine is, versus one I've scanned in or just put at the bottom of my email.
Hope that helps
Scott Scott Keir + scottkeir@yahoo.co.uk + 44 (0) 7811 266225
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On Sat, 7 Jan 2006, Scott Keir wrote:
I'm not sure what the legitimacy of a signature mark sent via fax machine is, versus one I've scanned in or just put at the bottom of my email.
I know that faxed signatures were fine for MAFF/Defra to do all sorts of stuff during the Foot and Mouth Crisis. I presume that if it is fine for a government dept to do this then it would be fine for private organisations to do so as well. IANAL though.
Hi All,
my views on the AoA issues are below. In short I agree with Scott, as we don't have to have a treasurer, we can not expect them to be present. Also, I think I know who the members will be.
On 1/7/06, Scott Keir scottkeir@yahoo.co.uk wrote:
Hello all
Here's my two-penneth (tax-deductable):
On Monday, January 2, 2006, at 01:35 pm, James D. Forrester wrote:
James D. Forrester wrote:
Diane Cabell wrote about the AoA:
You may, as a separate matter, require the vote of a supermajority to pass any resolution at the meeting. A simple majority vote is required for votes at meetings of the directors [See Sec. 33(e)]. You may wish to add a mirror of 33(e) to Sec. 16. You can adjust Sec. 16's voting requirement to 75% but bear in mind that a supermajority requirement can often result in a frozen corporation unable to muster enough votes to take action. While you may want broad support for some types of votes, you certainly don't want to be held up on more mundane activities.
Possibly. Thoughts, anyone? I'm not wholly enamoured with the idea, personally.
Have it so that the majority of people who can be bothered to turn up to an AGM can make the decisions, approve the accounts etc - ie a simple majority vote of those present.
I'm not too clear on what the membership will be - eg will they just be people who sign up to a mailing list, or promise money to a certain level? In the event that we have many passive/sleeping members, we don't want their inactivity to freeze the company.
The members are (1) all the people who sign the MoA and AoA and (2) anybody who applies to the directors and is given membership and obeys the rules (to be written by the directors). I imagine those rules will involve some amount of money changing hands (a subscription) and one of the first tasks after writing the rules will be to get the people who signed the articles to agree to become members under the new rules. The directors may have more than one category of membership - and some may not give members the right to vote or attend meetings.
As I understand it, votes at the AGM and EGM will be by simple majority of those who both turn up and vote. If 10% of a membership of 100 turn up to a meeting, two people vote for a motion, one votes against and seven abstain the motion is carried.
- Sec. 9(d) and (e)
It is generally risky to condition the corporation's activities on the presence of any single individual. A dissatisfied (or ailing) Treasurer could simply fail to appear and hold up all the proceedings, even those that don't affect the budget (such as election of officers, appointment of additional directors, amendment of bylaws, etc.). The directors have all the rights and obligations of a treasurer. They may delegate these to an officer, if they choose. Generally, it is accomplished by enacting a set of bye laws for the corporation that specifies the titles of the officers and their duties and empowers each as appropriate. The members of the corporation, on the other hand, are not generally responsible for the day-to-day operations of the company and you don't want to hold up those activities until the membership (often a very large class of individuals) holds its meeting.
Instead of requiring the physical presence of a Treasurer, or allowing one individual to hold up the proceedings of the corporation, it might be more appropriate to enact a bye law that sets objective standards for voting on budgetary items. For example, requiring that any vote having a direct effect on expenditures should, _where possible_, be reviewed and reported on by the Treasurer in advance. See Sec. 38(b) as an example of objective language. The law requires the Directors to take certain actions by certain dates (including filing annual reports with Companies House and the Charity Commission and, of course, filing tax returns), so it would be risky to make that review mandatory. Otherwise the company might be in violation of the law because a disgruntled Treasurer doesn't want to cooperate. Sec. 34(a) and (d) present the same problem.
Possibly. The thing is, a great deal of the point behind Wikimedia UK is to raise money for grants to give organisations for charitable purposes (the Wikimedia Foundation would likely be the main beneficiary, yes, but certainly not the only one), and in such circumstances, the Treasurer is going to be absolutely vital; as we're quite a geographically spread-out organisation, it would be very hard to have the entirety of the Directors all "in the loop" 100% on every detail at every moment, whereas a Treasurer would necessarily be involved in everything of that sort, and so be a final authority.
How about adding something to Clause 31 saying that any Director can be removed by the rest of the Directors in a vote in a DM? That would allow unhelpful Treasurers to be replaced quite easily.
You do not want to be 100% reliant on all decisions being made with one person present. If the Treasurer is the only person of importance, why have anyone else there?
Sorry, I'm being facetious. But if you decide that every meeting has to have the person called the Treasurer there, then it will frustrate you.
In company law and charity law, all directors and all trustees are equally financially liable and responsible for the organisation, whether they label themselves Chair, Treasurer or Honorary Biscuit Officer or whatever. It is a good idea for the trustees/directors to have specific roles, just as in any other team, but in the interest of succession planning and engineering redundancy, its good for there to be some overlap, and some flexibility.
In an Annual General Meeting (which is the most common form of General Meeting this organisation will have), the usual role of a Treasurer is to present the accounts (we spent X, we got in Y, we're doing fine or we're going bankrupt) and call for approval of the accounts by the members (hands up). It is a Good Idea if they are there, but if their train breaks down, or they get stuck in a tube tunnel, or they have a heart attack outside the venue, or.. or... then it is a Good Idea if there is some flexibility to allow the Chair or another to fill in, rather than having to cancel the entire Annual General Meeting (and then having to wait at least 3 weeks for the next one). At the last meeting of Directors before the AGM, the Treasurer should have talked through the accounts with the other Directors, so everyone should have a rough idea of what all the figures mean anyway.
I agree with Diane and Scott here. We may want to have an accounts director and a fund raising director - we would then be in trouble if the articles required that somebody called a treasurer turned up.
Note: If you intend to open a UK bank account, the directors will need to delegate the authority to do so to some specific individual. The bank may require that the resolution contain particular language and name the specific individual. Check with your bank first.
The resolution would be post-creation of the company, though, so I assume we wouldn't need to fix this until then; we'd make any necessary changes before submitting to the Commission, though, so it shouldn't be a problem.
Some Articles (or Memos, I can't remember which at this hour) have this in their documentation - alternatively this could be stated in the documents that the Directors will create financial procedures for the operation of the company at its first meeting, and these will be published to members.
Or we could expect that the directors will create finical procedures and, if they don't require it by an ordinary motion at the first AGM.
For charities, it is frequently the case that expenditure authorisation (ie the signing of cheques) is made by two Directors, any two of four [often a named list, eg Treasurer, Chair, Vice-Chair, Vice-Treasurer]. Two of three is common too, but this can make things hairy when one of the signatories leaves and the paperwork to replace them takes ages (I speak from experience).
- 11(a) doesn't make sense to me.
The Charity Commission template uses the simple statement "General meetings shall be chaired by the person who has been appointed to chair meetings of the Directors."
Note: Directors are not necessarily members of the company unless you require this elsewhere in the document. The UK concept of a charity is that the directors are the trustees who act to direct a operations that, in turn, benefit the membership. An example is a bunch of fat cats who decide that the world needs another soup kitchen for the deserving poor. The fat cats are generally the directors/trustees and the deserving poor are generally the members. The rights of the members of a charity are more limited than those of a commercial share-holder organization. The reason is that the directors are responsible for funding the operation and may decide, if they see fit, to change the beneficiaries of their operations (perhaps turn it into a library if they decide that the deserving poor are getting too fat). Even for shareholder organizations, the members generally have very few powers over daily operations.
I have no problem with it - GMs are chaired either by the Director who chairs DMs, or a Member who the Directors have chosen so to do. It's simple enough.
But why would you want this? In almost every organisation, GMs are usually chaired by the Chair of the Board of Trustees/Directors etc or someone similar. If you want it as described in your para above, then the current clause confuses meetings (of Directors) and General meetings. How about:
General meetings shall be chaired by the person who has been appointed to chair meetings of the Directors or the member appointed by the Directors to chair General meetings.
We might want to add something about Directors having to also be Members, though, yes; 31(c) implies it, of course ("A Director shall cease to hold office if he [...] ceases to be a member of the Company").
If Directors are implicitly to be members then it would be good to state this explicitly, checking that that doesn't impact on who we were envisaging would be members and who would be directors.
wikimediauk-l@lists.wikimedia.org