Legal Question in Business Law in California

Re: corporation law

I think a court would apply the ordinary rules for deciding whether an oral contract was formed, including whether a reasonable person who was present for the discussions would believe, at the time, that one or more parties made and agreement with one or more other parties with the present intention to be contractually bound, that there was a "meeting of the minds," etc.

The fact that the setting was a corporate board room and that a board meeting was under way would be taken into account in deciding whether the conversations could reasonably be taken to have binding intent. Since it is customary for boards to discuss matters without taking formal action, and indeed the bylaws and tradition usually require formalities, it is very unlikely that the court would find a contract binding the corporation itself. An exception could exist if the party alleging a contract in his favor were a third party (non-director) who had been led to believe he was making a contract with the corporation and that belief was reasonable.

As to whether a director made an oral contract with another director, that too is unlikely, but perhaps not so unlikely as with regard to the corporation being bound to someone. Again, it would depend upon whether intent to be bound existed at the time, and that would be measured not by the subjective or hidden intent of the parties to the alleged contract, but upon how things would have appeared to a reasonable bystander.

Re: corporation law

generally, directors at a board meeting discuss and pass on resolutions governing the acts of the corporation, as recorded on the minutes of the meeting.

I am not sure what you are referring to as "agreements reached during a board meeting". Are these agreements between the directors to which the corporation is not a party, or are you referring to agreements to decisions for the corporation to take certain action? If the latter, it depends on what the agreement is as to whether it constitutes a formal agreement that one party can enforce against the other. If it is the latter, any action requiring board approval should be recorded in the minutes. Otherwise, there is no record of board approval.

Re: corporation law

generally, directors at a board meeting discuss and pass on resolutions governing the acts of the corporation, as recorded on the minutes of the meeting.

I am not sure what you are referring to as "agreements reached during a board meeting". Are these agreements between the directors to which the corporation is not a party, or are you referring to agreements to decisions for the corporation to take certain action? If the latter, it depends on what the agreement is as to whether it constitutes a formal agreement that one party can enforce against the other. If it is the latter, any action requiring board approval should be recorded in the minutes. Otherwise, there is no record of board approval.

Re: corporation law

If you're asking if they have to follow Roberts Rules of Order, of course not. They just have to reasonably document in the minutes what decisions were made. If someone validly contests the minutes, then there would have to be a more formal 'meet and vote' session to ratify or correct the prior minutes and decisions.