It is ironic that in an era of technology, recording devices have been banned at company meetings. Or is it?

The South Australian Supreme Court (SASC) in Alliance Craton Explorer Pty Ltd v Quasar Resources Ltd [2010] SASC 266, held that the use of recording devices can be prohibited at meetings by the Chairman. The Chairman also reserves the right to adjourn the meeting if any member defies this rule.

Quick Facts

• In the above case, a Joint Venture (JV) took place between the plaintiff and defendant.

• The plaintiff held 25 percent and the defendant held 75 percent of voting power on the management committee.

• In one of the meetings the Chairman ruled that the meeting could not be recorded by the plaintiff. In spite of this announcement, the plaintiff continued to record the meeting.

• As a result, the meeting was adjourned by the Chairman.

The JV agreement did not contain any provisions on this procedural aspect or the management committee’s powers either.

What happened next?

The plaintiff challenged the Chairman’s decision. The SASC ruled in favour of the defendant dismissing the plaintiff’s argument that the chairman did not have the right to adjourn the meeting. The court also highlighted that the Chair has innate powers to exercise its discretion on these matters, in the absence of express contractual provision.

Section 4 of The Listening Devices Act, 1972, provides that a person must not intentionally use any listening device to overhear record, monitor or listen to any private conversation whether or not the person is a party to the conversation, without the consent, express or implied, of the parties to that conversation. However, section 7 of the same Act provides for the use of recording devices for the protection of the lawful interests of a person who is a party to the conversation.

In this case, the plaintiff was a party to the meeting and wanted to record the meeting however it failed to prove that it had a lawful interest in doing so.

Lessons

There is no simple or set rule that administrates the use of recording devices in meetings. The discretion of the Chair is mainly to facilitate meetings and to preserve order. His or her role is to also ensure that proceedings are conducted in a proper manner and to prevent unruly conduct that prevents a meeting from continuing.

Ideally, it makes for good protocol and avoids any professional embarrassment if such intentions to use recording devices are announced before the meeting itself. Any possible objections can be resolved beforehand rather than invite unwanted adjournments and certainly expensive law suits.