LML4806
ASSIGNMENT 1 (SEMESTER 1)
DUE DATE: March 2025
Written Assignment Submission Guidelines:
Please ensure that your assignment is submitted electronically through the myUnisa platform no
later than March 2025. Kindly note that fax or email submissions will not be accepted.
NB: Assignment submitted to the lecturer(s) through email will not be considered.
QUESTION 1
Can Busi Validly Appoint a Proxy to Attend the AGM and Express Her Views?
Based on the provisions of the Companies Act 71 of 2008 and the facts presented, Busi can appoint
a proxy to attend the Annual General Meeting (AGM) and vote on her behalf, as long as she complies
with the requirements set out in the company’s Memorandum of Incorporation (MOI). According
to the MOI in Clause 10.3, an instrument appointing a proxy must be submitted to the Transfer
Secretaries or the Chairperson of the Company at least 48 hours before the commencement of the
AGM.
In this case, since Busi realizes she will be unable to attend the meeting due to an emergency and
only has two hours before the meeting to appoint a proxy, she cannot validly appoint a proxy at
this late stage, because it falls outside the 48-hour requirement stipulated in the MOI.
However, Section 57(4) of the Companies Act provides that a shareholder can appoint a proxy by
submitting the appointment at a reasonable time before the meeting, and that the company’s MOI
or rules may set a different timeframe. Since Busi is aware of the 48-hour notice requirement in the
, MOI, she must comply with it unless the Board of Directors allows a shorter period or waives the
condition, but this does not appear to be the case here.
Thus, Busi cannot appoint a proxy validly within two hours of the meeting, and if she does so, the
proxy would likely not be accepted due to the company’s specific provision in the MOI.
Is Clause 10.3 of the MOI a Valid Clause?
Clause 10.3 of the company’s MOI which requires proxy instruments to be submitted at least 48
hours before the AGM is valid under the Companies Act 71 of 2008. Section 57(4) of the Act gives
a company the freedom to determine the timeframe for the appointment of proxies in its MOI, as
long as it is reasonable. A 48-hour notice requirement is considered reasonable and is typically
enforceable.
The Companies Act does not prohibit the imposition of a timeframe for proxy appointments;
instead, it provides the flexibility for companies to set such requirements within the boundaries of
reasonableness. Therefore, Clause 10.3 is valid, and the company is entitled to enforce it, provided
it has been properly included in the MOI and shareholders were made aware of it in advance.
Conclusion:
• Busi’s Proxy Appointment: Busi cannot validly appoint a proxy if she attempts to do so less
than 48 hours before the meeting, as the company’s MOI mandates this requirement, and it
is enforceable under the Companies Act.
• Validity of Clause 10.3: The 48-hour deadline set by the company’s MOI for proxy
appointments is valid and enforceable, as it aligns with the provisions of the Companies Act
71 of 2008.
ASSIGNMENT 1 (SEMESTER 1)
DUE DATE: March 2025
Written Assignment Submission Guidelines:
Please ensure that your assignment is submitted electronically through the myUnisa platform no
later than March 2025. Kindly note that fax or email submissions will not be accepted.
NB: Assignment submitted to the lecturer(s) through email will not be considered.
QUESTION 1
Can Busi Validly Appoint a Proxy to Attend the AGM and Express Her Views?
Based on the provisions of the Companies Act 71 of 2008 and the facts presented, Busi can appoint
a proxy to attend the Annual General Meeting (AGM) and vote on her behalf, as long as she complies
with the requirements set out in the company’s Memorandum of Incorporation (MOI). According
to the MOI in Clause 10.3, an instrument appointing a proxy must be submitted to the Transfer
Secretaries or the Chairperson of the Company at least 48 hours before the commencement of the
AGM.
In this case, since Busi realizes she will be unable to attend the meeting due to an emergency and
only has two hours before the meeting to appoint a proxy, she cannot validly appoint a proxy at
this late stage, because it falls outside the 48-hour requirement stipulated in the MOI.
However, Section 57(4) of the Companies Act provides that a shareholder can appoint a proxy by
submitting the appointment at a reasonable time before the meeting, and that the company’s MOI
or rules may set a different timeframe. Since Busi is aware of the 48-hour notice requirement in the
, MOI, she must comply with it unless the Board of Directors allows a shorter period or waives the
condition, but this does not appear to be the case here.
Thus, Busi cannot appoint a proxy validly within two hours of the meeting, and if she does so, the
proxy would likely not be accepted due to the company’s specific provision in the MOI.
Is Clause 10.3 of the MOI a Valid Clause?
Clause 10.3 of the company’s MOI which requires proxy instruments to be submitted at least 48
hours before the AGM is valid under the Companies Act 71 of 2008. Section 57(4) of the Act gives
a company the freedom to determine the timeframe for the appointment of proxies in its MOI, as
long as it is reasonable. A 48-hour notice requirement is considered reasonable and is typically
enforceable.
The Companies Act does not prohibit the imposition of a timeframe for proxy appointments;
instead, it provides the flexibility for companies to set such requirements within the boundaries of
reasonableness. Therefore, Clause 10.3 is valid, and the company is entitled to enforce it, provided
it has been properly included in the MOI and shareholders were made aware of it in advance.
Conclusion:
• Busi’s Proxy Appointment: Busi cannot validly appoint a proxy if she attempts to do so less
than 48 hours before the meeting, as the company’s MOI mandates this requirement, and it
is enforceable under the Companies Act.
• Validity of Clause 10.3: The 48-hour deadline set by the company’s MOI for proxy
appointments is valid and enforceable, as it aligns with the provisions of the Companies Act
71 of 2008.
