The terms minute and resolution are often used interchangeably and it is common for a trustee resolution to be only treated as final once signed – but is this correct? What is a resolution? A record of a decision or is the resolution the decision?
I have previously considered whether a resolution requires that there be a meeting. See Does a resolution require a meeting? However, if there is a meeting, is the resolution valid only when signed by all of the trustees who made the decision?
The matter has just been somewhat usefully canvased in Mair & Ors v Pehi. The trust in question is a common law trust as the “post-settlement governance entity” for Whanganui iwi in relation to settlement of historical Treaty of Waitangi grievances. However, the question for consideration by the court, which may have wider application, relates to the validity of a partially executed trustee resolution, which was circulated after a hui at which the subject of the resolution was put and passed.
Following the hui the terms of the agreed resolution were recorded in writing and the written resolution was circulated for execution. However one trustee did not sign the resolution and as certainty was required in a timely fashion the matter was brought before the court as an application for directions in accordance with s 66 of the Trustee Act.
While the validity of any other resolution would require consideration of the relevant trust deed the decision provides that where consistent with the terms of the trust a written resolution can be verification of a resolution which has already been proposed and passed orally.
Note that where a deed specifies that a valid resolution must be recorded in writing it would be important to carefully review whether the written record is the resolution or a record of the resolution. A subtle but important consideration.
- Mair & Ors v Pehi  NZHC 1398
- Trustee Act 1956, s 66