14/10/2020 – Jurisdiction British Columbia
Part 72 published on 01/12/2020
Strata corporation’s special meeting not validly held
During the pandemic emergency, the strata corporation had held a special meeting of the owners at which a three-quarter (3/4) resolution had been passed to authorize termination of the corporation’s management agreement. The Tribunal found that the meeting had not been validly called or held. The Tribunal’s reasons included the following:
- The corporation had failed to give all owners a proper opportunity to attend the meeting. Section 56 of the Strata Property Act means that all owners and proxies “must have the opportunity to vote in person at an SGM if they decide to do so”. A provincial order (during the Covid-19 emergency) limited in-person gatherings to 50 persons. A provincial order also permitted owners to attend electronically. The corporation had only allowed owners to otherwise attend by written proxy (but, again, the appointed proxies were not necessarily able to attend the meeting). The Tribunal said:
However, the strata did not provide an alternative method of attendance, such as by telephone or computer, that would allow all eligible voters and proxies to attend and participate “in person”. I find the evidence does not support the strata’s argument that not all strata lot owners would be capable of attending by telephone or electronic means, and in any event this does not affect the SPA (Strata Property Act’s) SGM requirements. Also, I acknowledge that only 16 strata lot owners attended the SGM in person after the strata announced the 50-person limit, but again, this does not change the SPA’s SGM requirements.
- The strata corporation had treated some of the proxy votes as “advance ballot votes”, and the Tribunal said that “there is no explicit provision for advance ballot voting, before an SGM”.
- Persons attending by proxy were instructed to choose only a specified person as proxy. They were not permitted to freely choose someone to serve as proxy.
- The corporation had accordingly failed to hold the meeting in compliance with Section 56 of the Strata Property Act.
- In addition, the Notice of Meeting appeared to be inadequate. In particular, notices by email (the only compliant method chosen by the Board) were only provided to some (not all) of the owners.
- Furthermore, the resolution purportedly voted upon at the meeting had been amended without following proper procedures to do so. The Tribunal also said:
I find it significant that many strata lot owners cast advance “proxy votes” based on the proposed wording in the April 28, 2020 SGM notice, and that these votes were counted as approving different, amended wording at the SGM, without first approving those amendments.
The Tribunal ordered the corporation not to act on or rely on the meeting results. [The corporation was however free to call and hold a fresh meeting for the same business.]
At the same time, the Tribunal dismissed the owner’s claim against one of the Board members, in which the owner alleged that the Board member had improperly solicited proxy votes. The Tribunal held that there was no conflict of interest that prevented the actions of the Board member.