By Corinne Gartner
In a recent post, we offered some best practices for preparing minutes of board meetings of California nonprofit corporations. Here’s another general tip (borrowed from Habit 2 of The 7 Habits of Highly Effective People): Begin With the End in Mind. In the context of preparing nonprofit board meeting minutes, this means to think about who (besides the board itself) might ultimately have access to the minutes.
Minutes of board meetings of most California nonprofit corporations are not required to be open to inspection by the general public. However, if the corporation has statutory members (i.e., voting members, as defined in California Corporations Code § 5056), the members have a right to inspect board meeting minutes. (See Cal. Corp. Code §§ 6311, 6333, 8311, 8333, 9512.) This member inspection right may be limited if the corporation is a religious corporation, but cannot be limited in the case of California’s other types of nonprofit corporations (public benefit corporations and mutual benefit corporations).
In addition, under California law, the California Attorney General has broad oversight over public benefit corporations and mutual benefit corporations holding assets in charitable trust, including the right to inspect board meeting minutes upon proper demand. (Cal. Corp. Code §§ 5250, 7240; Cal. Gov. Code §§ 12580-12599.8.) Finally, board meeting minutes could be subject to discovery in the event the corporation becomes involved in litigation.
The takeaway? Board meeting minutes might not end up being for the board’s eyes only, so when preparing them, California nonprofit corporations would be wise to consider other potential constituencies who might someday read them.
Nothing in this blog is intended to constitute legal advice and your interactions with this blog do not result in the formation of an attorney-client relationship. All matters are different and, as such, nothing in this blog is intended to guarantee, warrant, or predict a specific outcome.