Challenges by owners to the chair, proxies, and voting

Davis v. Peel Condominium Corporation No. 22 [2013] O.J. No. 2594 is a recent decision of the Superior Court of Justice about owners’ meetings, especially voting rights and the role of the chair. It was an application by an owner alleging the chair of the meeting improperly allowed 12 proxies to be used to remove the board of directors. Without the 12 votes, the requisition to remove the directors would have failed.

The Court dismissed the application. The owner argued that the condominium’s lawyer and property manager had already found the proxies invalid because of arrears so there was no reason for the chair to rule on them. The judge disagreed:

Nothing in the statute confers the authority to make that decision upon the manager or the lawyer for the corporation. While, as a matter of procedural efficiency, the lawyer and the manager may assist in the meeting registration process, that does not confer authority upon them to make final determinations. Where there is a challenge to the preliminary determination that a proxy is ineligible (or, for that matter, is considered to be eligible), in the absence of any other specified mechanism, that decision should be made by the chair of the meeting.

The case emphasizes the significant influence a chair can have at a meeting. While the court held that a person is not an improper chair simply because he/she has an interest in the outcome, it would seem to me to be more appropriate to select or elect a chair (assuming the by-laws permit such) that is not interested in the outcome of any vote to be taken at the meeting. For instance, if a director is seeking re-election at the meeting it may be more appropriate for another director to chair.

As a final note, I should mention that one of the reasons the chair allowed the 12 proxies to be used was the condominium’s poor record-keeping. While the condominium argued the owners were in arrears, the chair found there was no evidence to establish the records were accurate. In fact, several of the owners paid their arrears when registering for the meeting or brought bank records showing payments were made in advance of the meeting.