Corporations Act 249H: How Shareholders Can Call a Directors’ Meeting

If you’re running a company with other shareholders, you’ve probably had moments where you want decisions made quickly - but the board (or the other directors) aren’t calling meetings, aren’t circulating updates, or aren’t engaging with shareholder concerns.

That’s where the Corporations Act steps in. In particular, many business owners come across section 249H and start asking: can shareholders “call a directors’ meeting”?

In practice, shareholders generally can’t force a board meeting (a directors’ meeting). But shareholders can require the company to hold a general meeting of shareholders (a members’ meeting) - and section 249H of the Corporations Act becomes important because it sets core rules for giving notice of that meeting.

Below, we’ll break down how the process works in plain English, what section 249H actually covers, and how you can use Corporations Act mechanisms to get a meeting happening when it matters.

What Does Section 249H of the Corporations Act Actually Do?

Section 249H (often searched as “249H Corporations Act”) is primarily about notice of meetings of members (shareholders).

It sets out who must receive notice and the minimum notice period for a meeting of shareholders (subject to some important exceptions and related provisions).

While the section is often mentioned in conversations about “calling a meeting”, it’s important to understand that:

• 249H doesn’t give shareholders the power to call a board meeting (directors’ meeting).
• 249H governs key notice requirements once a meeting of members is being held (including meetings shareholders request or call).

In other words, if you’re trying to “force a meeting” because directors aren’t listening, you’ll usually be looking at sections like 249D (members request directors call a meeting) or 249F (members call a meeting themselves) - and then you’ll rely on 249H (and related notice provisions) to make sure the notice is valid.

It’s also worth checking whether your company has replaced some “replaceable rules” with a tailored Company Constitution, because constitutions can add procedural requirements (and you’ll want to follow both the constitution and the Corporations Act).

When Would Shareholders Need to “Force” a Meeting?

In a small business company, disputes and deadlocks are common - especially where the shareholders are also directors (which is typical in founder-led companies).

You might want a meeting because:

• you suspect poor financial management and want formal accountability
• the board is ignoring shareholder requests for information
• you want to remove or appoint a director
• you want to replace the auditor (where relevant) or address financial reporting issues
• the company is proposing a major transaction and you want members to vote
• you’re at a deadlock and need shareholder resolutions to move forward

Even where you can’t compel a directors’ meeting, a properly convened general meeting can still be powerful, because members can pass resolutions (including, in many cases, resolutions about directors).

If you have a Shareholders Agreement, it may also include deadlock clauses, meeting rights, and decision-making processes that sit alongside the Corporations Act.

Step-By-Step: How Shareholders Can Get a Meeting Called (And Where 249H Fits)

There are generally two main pathways shareholders use to get a general meeting happening when directors won’t voluntarily call one:

• Requesting the directors call a meeting (commonly via section 249D)
• Calling the meeting themselves (commonly via section 249F)

Once a meeting is being convened (whether by directors or members), section 249H becomes essential because it deals with notice. If notice is wrong, the meeting (and any resolutions passed) can be challenged.

1) Check Your Constitution And Shareholder Documents First

Before you send formal notices, check:

• the company’s constitution (if any)
• any shareholders agreement
• the share register (so you can confirm who the members are and their voting power)

Some companies use the Corporations Act replaceable rules. Others have adopted a tailored constitution (for example, through Adopt A Constitution) which can change meeting mechanics, notice methods, and voting thresholds.

2) Use The “Request Directors Call A Meeting” Route (Commonly s249D)

In many cases, shareholders start by formally requesting the directors call a general meeting.

Broadly, this route requires that the request comes from shareholders with at least:

• 5% of the votes that may be cast at the general meeting, or
• (for certain companies) at least 100 members entitled to vote (more common in widely held companies than small proprietary companies)

The request needs to be properly drafted, state the resolutions to be proposed, and be given to the company.

If the request is valid, directors generally must call the meeting within the timeframes required by the Act (and then issue notice that complies with the Corporations Act, including section 249H where applicable).

3) Shareholders May Be Able To Call The Meeting Themselves (Commonly s249F)

Section 249F can allow members with at least 5% of the votes that may be cast at the general meeting to call and arrange a general meeting themselves. This is sometimes used where directors don’t act on a valid request, but it can also be used as a direct pathway where the threshold is met.

This is where it becomes extra important to follow the meeting rules carefully, including:

• who is entitled to receive notice
• how notice is served
• how much notice must be given
• what must be included in the notice (agenda/resolutions)

Those “notice” questions are why section 249H is so commonly searched - because notice mistakes can undermine the whole meeting.

How Much Notice Is Required Under 249H?

Section 249H sets out the basic notice requirements for meetings of members. The default position is that members must be given at least 21 days’ notice of a general meeting.

There are some important wrinkles (and these often matter in shareholder disputes):

• Listed companies generally need at least 28 days’ notice (this is dealt with under a related provision, section 249HA).
• A meeting can sometimes be called on shorter notice if the required majority of members agree (commonly, a 95% threshold applies, but the rules differ depending on the type of company and the purpose of the meeting).

In a small proprietary company, shareholders often want things done quickly - but rushing and getting notice wrong is one of the easiest ways to create legal risk.

Who Must Receive Notice?

Notice must be provided to:

• each member entitled to vote at the meeting
• each director
• the company’s auditor (if the company has one and the auditor is entitled to notice)

This matters because, in many small businesses, the “problem” person may be both a shareholder and a director. Even if the meeting is being called because of a dispute with them, they still usually have legal rights to receive notice.

How Should Notice Be Given?

The Corporations Act and your constitution will affect the acceptable delivery methods (for example, post vs email). This is a common trap - particularly where a company has historically communicated informally (texts, DMs, verbal chats) but then tries to rely on those same habits for formal notice.

If the constitution allows electronic service, email may be fine. If it doesn’t, you may need to use more formal methods. The safest approach is to follow the constitution and keep clear records of:

• when notice was sent
• how it was sent
• what exactly was sent (attachments, wording, resolutions)

What Should Be Included In The Meeting Notice (So Resolutions Actually Stick)?

Getting the notice period right is only part of the story. The content of the notice matters too.

For a shareholders meeting, you’ll typically want to include:

• date, time and place of the meeting (including video/online details if permitted)
• the general nature of the business to be dealt with
• the text of proposed resolutions (especially for special resolutions)
• explanatory information where required or strongly recommended (to reduce disputes about what people were voting on)
• proxy details (how to appoint a proxy, deadlines, forms)

If the goal is to remove or appoint directors, or pass a special resolution, you need to be particularly careful. These decisions can have major consequences for control of the company, bank access, and ongoing operations.

You should also check whether any proposed resolution triggers special notice requirements under the Corporations Act (for example, certain resolutions about directors or auditors can require special notice and additional steps).

From a practical standpoint, it’s also wise to align the meeting notice and proposed resolutions with your company’s governance documents - for example, your constitution and any share classes (if not all shares vote the same way).

Practical Tips For Small Businesses (To Avoid Disputes And Keep Your Company Running)

In founder-led companies, calling a meeting is rarely just a “legal formality” - it’s usually happening because something has already gone wrong in the relationship.

Here are some practical ways to reduce the risk of the meeting being challenged (and to keep the business operational while you work through governance issues).

Put The Rules In Writing Early

The easiest time to set meeting rules is when everyone is still getting along.

For many small companies, that means having:

• a tailored Shareholders Agreement setting out voting thresholds, deadlock processes, and dispute resolution
• a clear Company Constitution (or a deliberate choice to rely on replaceable rules)

These documents can help you avoid needing to rely on “bare minimum” statutory processes at the worst possible time.

Keep Your Paper Trail Clean (Especially Service And Voting Records)

If you’re calling a meeting in a dispute context, assume everything you do may be scrutinised later.

That means keeping copies of:

• the request to call the meeting
• proof of shareholdings and voting power
• the meeting notice and attachments
• delivery records (email sent items, registered post receipts)
• attendance and proxy forms
• minutes and outcomes

Minutes and resolutions should be consistent with your governance approach. For example, if you need formal decisions recorded, it can help to use a consistent template style, similar to how you’d document important corporate decisions via a Directors Resolution Template (even though general meeting minutes are distinct from directors’ resolutions).

Be Careful About “Informal” Agreements And Sign-Offs

In small businesses, people often agree to big decisions over email or a quick phone call. Sometimes that works - until it doesn’t.

If your meeting results in documents needing execution (for example, changes to company structure, significant contracts, or banking authorities), you should ensure signing is done properly. Many companies rely on execution rules like section 127 signing to reduce arguments about whether documents are validly executed.

Consider The Commercial Impact Before You Escalate

Calling a formal meeting can be the right move - but it can also inflame a conflict.

Before you press “send” on a notice, it’s worth thinking through:

• Will this disrupt staff, suppliers, or customers?
• Is there a funding or banking deadline coming up?
• Are there key contracts that require director approval vs member approval?
• Would a mediated discussion (or structured negotiation) resolve the issue faster?

Sometimes the best path is a combination: you prepare to call the meeting properly (so you’re not stuck), while also trying to resolve the dispute commercially.

Key Takeaways

• Section 249H of the Corporations Act is about giving valid notice of a meeting of members, not about calling a directors’ (board) meeting.
• Shareholders usually can’t force a board meeting, but they can often require a general meeting through mechanisms like requesting directors call the meeting (and in some cases, by calling the meeting themselves).
• Getting the notice period, recipients, and delivery method right under section 249H (and related notice rules, including for listed companies) is crucial - mistakes can lead to challenges to the meeting or resolutions.
• Your constitution and any shareholders agreement may add extra requirements (or provide more efficient ways to manage deadlocks and disputes).
• For small businesses, the most practical approach is usually: follow the rules carefully, keep a strong paper trail, and align the meeting process with your company’s governance documents.

If you’d like help preparing a shareholder meeting notice, reviewing your company constitution, or navigating a shareholder dispute, contact Sprintlaw on 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.