23 Jun Meetings
An owners corporation or Body Corporate, is a separate legal entity with lot owners as members and accordingly, needs to have appropriate methods of decision making.
Types of decisions
There are three types of decisions an owners corporation may pass:
- an ordinary resolution which is a simple majority of cast are in favour;
- a special resolution which requires 75% of all lots affected by the owners corporation to vote in favour;
- a unanimous resolution which requires all lots affected by the owners corporation vote in favour.
Most matters are determined by ordinary resolution with only a limited number of particular matters requiring a special or unanimous resolution. These will be specified in the relevant legislation.
General Meetings
All members are entitled to attend or appoint a proxy to attend general meeting to represent a member who is unable to attend.
The most common is the Annual General Meeting (AGM). An owners corporation which receives or pays out money in any financial year is required to convene an AGM. The AGM allows for review of the preceding year and the approval of future activities such as setting the annual fees and appointing a committee.
It is held after the end of the owners corporation financial year and agenda items will include:
- confirming the minutes of the previous AGM;
- receiving the financial statements;
- determining the annual fees (budget) for the current financial year;
- reviewing insurance;
- appointing a committee;
- other matters such as approving works.
Any other general meeting of members is a Special General Meeting (SGM). An SGM is usually convened to consider a particular business such as making rules or considering building defects. Most owners corporations do not conduct a SGM in a given year.
What Notice Period is Required?
The notice period for a general meeting is specified as a minimum of 14 days to allow for the distribution of the notice of meeting and agenda. In practical terms, this is 21 days to allow for delivery by post where members have not elected electronic delivery.
What is the Quorum for General Meeting?
The quorum is 50% of the lots affected by the owners corporation.
Can a General Meeting Proceed Without a Quorum?
A meeting may proceed in the absence of a quorum but all decisions taken are termed interim resolutions. The minutes are required to be sent to members within 14 days of the meeting and take effect 29 days after the meeting unless petition from 25% of members opposing those decisions is received within 28 days of the meeting.
Ballots
An owners corporation may make a decision by ballot which is a written vote taken outside of a general meeting. The ballot must be open for a minimum of 14 days and all members are entitled to exercise their voting rights.
Voting papers must be returned by the specified closing date and a ballot may not be extended. Any late voting paper is not counted in determining the result.
If a ballot is being conducted for an ordinary resolution matter, a quorum must be achieved to pass a valid resolution. If a quorum is not achieved, the motion is not passed.
Eligibility to Vote at a Meeting or in a Ballot
A member who has fees or charges owing to the owners corporation at the date of the meeting or close of a ballot is not entitled to cast a vote for an ordinary resolution item. If a special or unanimous resolution is under consideration, all members are entitled to vote even if there are any fees or charges outstanding. Fees must be paid at least four (4) business days before the date of the meeting or the close of the ballot.
Committees
The owners corporation may elect a committee at the AGM which is delegated powers and functions requiring an ordinary resolution. The committee will have the power to act on behalf of the owners corporation between AGMs.
An owners corporation consisting of more than 10 members is required to appoint a committee at each AGM. It consists of between 3 and 7 members although the maximum size can be up to 121 if authorised by ordinary resolution.
Committees may act more informally with a shorter notice period for meetings which allows greater flexibility when compared to a general meeting. It also obviates the need to have SGMs and the possible delay which may arise if a special general meeting is conducted.
A committee meets when it considers it appropriate. Committees may conduct their business by email to provide greater flexibility and speed.