Owners in limbo after proxies used in levy vote


Wednesday, October 4th, 2017

Proxies put tenants in a pickle

Tony Gioventu
Times Colonist

Dear Tony:

Our strata council has put owners in a serious conflict. The council proposed a special levy of $100,000 to remodel our lobby and the owners passed it at a special general meeting last week.

No one is objecting to the price. A good specification was written and we had four bids for the work, which includes new marble flooring, new elevator cabs, new entry doors, lighting and new windows.

The problem that has arisen stems from procedures at the meeting. A council member was holding proxies for 35 units. The vote only passed by three. The next day, at least five owners came forward advising they did not authorize proxies held by this person.

Our council deemed that the vote was still valid and proceeded to sign the contract and issue a deposit to the successful company. Because it was a three-quarters vote, more than 50 per cent of the owners petitioned to reconsider the vote.

Martin D.

Dear Martin:

The Strata Property Act sets out specific conditions to reconsider three-quarters votes. If a three-quarters vote is passed at a special general meeting by individuals holding less than 50 per cent of the strata corporation’s votes, the strata corporation must not take any action to implement the resolution for one week following the vote, unless there are reasonable grounds to believe that immediate action is necessary to ensure safety or prevent significant loss or damage.

Within one week following the vote, individuals holding at least 25 per cent of the strata corporation’s votes can, by written demand, require that the strata corporation hold a special general meeting to reconsider the resolution. The demand must be signed by each person making it.

After receiving a demand for a special general meeting, the strata corporation must not take any action to implement the resolution unless there are reasonable grounds to believe that immediate action is necessary to ensure safety or prevent significant loss or damage.

The strata corporation must hold the meeting within four weeks after the demand is given to the strata corporation. The president of the council can call the special general meeting without holding a council meeting.

At the meeting, the resolution being reconsidered is the first item on the agenda and must be dealt with before any other matter about which notice has been given. If a quorum is not present within a half hour of the start of the meeting, the meeting must not proceed and the resolution stands and can be implemented only if one of the following conditions is met: a) a demand for reconsideration is not made b) the resolution is approved by a three-quarters vote at the special general meeting held c) the meeting held does not proceed for lack of a quorum.

Even without the proxy errors, your strata council did not have the authority to proceed and deem the resolution passed and deny the petition.

Out of 178 votes in your strata, there were only 82 votes represented in person and by proxy. Your strata corporation must hold the petitioned meeting to reconsider this vote.

This problem occurs frequently in strata corporations that are eager to get on with the work and assume they have the authority to proceed.

Your strata council should consult with an experienced strata lawyer to look at its options. Holding the meeting is the first step. Depending on the outcome of the decision, your strata might be required to negotiate with the contractors.

The process certifying the proxies should be closely reviewed. Registration and issuing of voting cards can be done by your manager, a council member or volunteer, but only the chairperson of the meeting has the elected or appointed authority to determine whether a proxy is valid.

There is an ironic twist to this situation. Your strata corporation has more than $1.4 million in its contingency fund and these repairs are recommended in your depreciation report. It only required a majority vote to approve the $100,000 expense from the contingency fund and all of this could have been avoided.

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