26 Sep Dish from the Commish – Questions about meetings

Dish from the Commish – Questions about meetings

One of the fundamental aspects of being in a community titles scheme is the use of meetings and voting as a way of conducting body corporate business.

It is fair to say that some of the processes around meetings and voting can sometimes seem complex.

Processes will vary according to the Regulation Module applicable to a scheme.

With this in mind, I shall try, in a general way, to clarify some of the more common queries we receive.

As always, this information is not a substitute for a lot owner, caretaking service contractor, body corporate or committee seeking their own legal advice.

Lobbying

Question – Our caretaking service contractor has sent out a letter to all owners asking them to vote for certain committee candidates and to vote to extend the caretaking service contract. Is this permissible under the Act?

Answer – While the Body Corporate and Community Management Act 1997 and its associated regulations remain silent in regards to lobbying, it sets out the procedures required for calling and conducting general meetings to support owners making an informed, valid vote.

We have dealt with a small number of dispute resolution applications where it was claimed lobbying had influenced the vote. In each case, the adjudicator either could not find or was not presented with any evidence to suggest that any lobbying which might have been done to prevent a reasonable person making an informed, valid vote. In Macarthur Chambers Residences [2015] QBCCMCmr 252 at paragraphs 26 – 31, the adjudicator dealt with this issue and stated:

“Unreasonable Lobbying

  • The applicants state that the caretaker sends emails to owners who have their properties in the hotel pool, managed by her, instructing them how to vote and asking them to support her quest to insert an option to extend or renew the caretaking and letting agreement for a further five years and to elect certain persons to the committee. In addition to sending emails, the caretaker made a follow up phone call, again putting pressure on owners to vote as per her demands.  In doing so, she used undue pressure – close to 75% of the properties are in the hotel pool.  If an owner does not agree with the caretaker’s demands, the income they are receiving may be affected.  The owners may have chosen to vote as per the caretaker’s instructions for fear of losing money.  In the applicants’ view, the caretaker’s actions are akin to placing duress on owners.  The majority of owners who have their properties under the caretaker’s management voted as per her demands.
  • The applicants argue that, in lobbying, the caretaker used for improper purposes, personal information she had access to, due to the nature of the letting agreement, such as emails and phone numbers. This information is not available in the roll for all owners.  She unfairly benefited from the information unavailable to other owners who may have had interest in lobbying regarding Motion 12.
  • The committee includes in its submission, with the caretaker’s permission, the email sent by Dianne Papendorf to lot owners dated 4 August 2014. The committee points out that it is lacking in demands, undue pressure, duress etc.  The committee concludes that they are completely unaware of any evidence that supports the applicants’ allegations, or of any legislative provision that prohibits lobbying.  The committee also points out that Greg Kern lobbied lot owners in writing and by phone, with some of the phone calls being made by his secretary.  They provide an example of a letter dated 6 August 2014.  The submission by the owner of lot 503 states she did not receive any phone calls from Dianne asking for support to vote for anyone at the AGM.  She states that “the only requested (more like demanded) support was from Karen Kern for herself and for Julie Stanton to attain the positions which they had nominated for.  Julie Stanton has obtained my addresses from some source to send out her dreadful allegations against everyone who stands in her way.”
  • Campaigning or lobbying is not specifically regulated by the Act or the Regulation Modules. Even so, this issue has been considered in the adjudication of previous dispute resolution applications. In Ipomoea Court[1], the adjudicator stated “Each lot owner has 21 days’ notice of the motions on the agenda. If he or she wishes to find out more about a motion, he or she may contact the proponent of the motion, or the committee. Lot owners may also canvass others to vote for “their” motion, or to vote in a particular way, and lobby before the meeting.  In St. Tropez[2], the adjudicator stated “if an owner disputes decisions made by the Committee majority, they should lobby owners to vote against the motions…It is then for owners to decide which approach they prefer.  In Liberty[3], the adjudicator stated there is nothing to prevent lobbying for the election of certain persons to the committee.
  • A lot owner lobbying for votes in the election of a person or persons to committee positions and or voting for or against particular motions is not contrary to the legislation.
  • I consider the applicants’ assertions in relation to the caretaker placing “undue pressure” on owners in the hotel pool to vote a certain way to be without substance. Further, they are not supported by a single owner submission.”

Who forms a quorum and meaning of a voter?

Question – As the caretaking service contractor, I own a lot in my company name and a lot in my own name. I am also the representative for my son’s lot but he owes levies to the body corporate. If I go to the meeting, am I considered to have three votes when determining the quorum for a general meeting?

Answer – The quorum for general meeting provisions in the regulations require at least 25 percent of the number of ‘voters’ to be ‘present’ for the meeting. The term ‘voter’ is critical to establish a quorum; it differs to being an ‘owner’.

The term ‘voter’ is defined in the regulations as an individual whose name is entered on the body corporate’s roll (as the lot owner or the representative); an individual who is the nominee of a corporation whose name is entered on the body corporate’s roll; or an individual who is a corporate owner nominee.  It is not simply a matter of finding 25 per cent of the number of lots on the scheme and ensure they are present.

In Sierra Grand [2015] QBCCMCmr 447, the adjudicator dealt with all these issues and many more surrounding the quorum provisions. In short, when looking at a non-financial owner, the adjudicator stated at paragraph 25:

  • “Following this approach, any voters who were disqualified from voting on the basis that they owed a body corporate debt would still be counted when determining the number required to constitute a quorum.”

 

In regards to a person (an individual) whose name is entered more than once on the body corporate roll i.e. as the company nominee for one lot and the representative of another lot, the adjudicator stated at paragraph 41:

  • “Secondly, the body corporate argues that Mario Braganza should only be counted as 1 voter for the AGM as he is listed on the body corporate role as both the owner of lot 1502 and the company nominee for lot 1402.[4] Given that Mr Braganza is listed as representing both lots, I am satisfied that he should only be considered as 1 voter, instead of 2, for the AGM.”

 

This order looks at many issues surrounding who forms a quorum for a general meeting and I encourage everyone involved in conducting or attending general meetings to read the full order and statement of reasons. This is published on the Australasian Legal Information Institute website,  www.austlii.edu.au.

 

General meeting tips

To finish, I thought it suitable to provide some tips for a productive meeting:

  • General discussion is not mentioned in the legislation so there is no explicit right for an owner to speak at a general meeting.
  • Remove emotion from the meeting as this can cause unnecessary tension. You are there to vote not to express your personal opinion. If you feel it is necessary to ventilate an opinion, view, grievance or instigate a detailed discussion, this can and ideally should be done before the meeting takes place.
  • Ensure owners are aware of the meeting processes and what they need to do to vote at the general meeting.
  • You cannot take or deliver another’s persons voting paper to the general meeting. The voting paper must be sent from the voter to the secretary or the person depicted in the voting instructions. Any voting papers handed in by a third person will be invalid.

 

For further information and for general queries about the body corporate legislation, please contact the Information Service on Freecall 1800 060 119, email bccm@justice.qld.gov.au or visit our website www.qld.gov.au/bodycorporate.

Untitled-design Dish from the Commish - Questions about meetings

About Commissioner Chris Irons

Chris Irons is the Commissioner for the Body Corporate and Community Management department of the Queensland Government. This department provides a range of information and services for those who live, invest or work in a community titles scheme in Queensland.

If you require information on strata or body corporate issues you can search our fact sheets at https://www.hbcm.co/resources/or visit the BCCM website for additional information here.