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Resolution
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The formal decision of an organization. A motion which has obtained the necessary majority vote in favor.
In parliamentary law and procedure, a motion of a single member becomes a resolution of the whole meeting if it carries; if it obtains necessary number of votes.
A resolution is what a motion seeks to become.
It is by resolution that an organization or company makes decisions and speaks.
As aptly put in the 2nd edition of Horsley’s, at page ¶608:
“Until and unless a resolution is passed, a meeting does not accomplish anything that a real effect; i.e. it does not produce a result which has any potency at all nor … any legal significance.
"But when a resolution has been passed, a legally binding decision has thereby been made.”
Practitioners of parliamentary law and procedure or company law or rules of order generally characterize resolutions by reference to the majority required for the underlying motion to carry.
A resolution in which requires a simple majority of those voting is called an ordinary resolution.
Special or extraordinary resolutions are those which require specified majorities, usually either two-thirds or three-quarters of the members present and entitled to vote. These types of resolutions generally relate to changes to the organizations constitutional documents and therefore, as a precautionary measure, a three-quarters or two-thirds majority is required.
For example, the Canadian federal incorporation statute, known as the Canada Business Corporations Act (CBCA), prefers the term “special resolution” which it defines at §2 as:
“’special resolution’ means a resolution passed by a majority of not less than two-thirds of the votes cast by the shareholders who voted in respect of that resolution or signed by all the shareholders entitled to vote on that resolution.”
Special or extraordinary resolutions are generally required for significant constitutional changes within the organization. For example, the CBCA requires a special resolution to dissolve a company (§210).
REFERENCES OR FURTHER READING:
- Canada Business Corporations Act, RSC 1985 Chapter C-44, published at canlii.org/ca/sta/c-44/
- Taggart, W. J., Horsley’s Meetings – Procedure, Law and Practice, 2nd Edition (Sydney: Butterworth, 1983)