Changes are Coming: Voting

vote

Big changes are coming to the voting procedures for owners’ meetings. I’ve previously written about the changes for notices and pre-notices, but you’ll also need to familiarize yourself with the new requirements for voting at owners’ meetings.

Method of Voting

The method of voting is changing. Votes at an owners’ meeting can currently be cast by show of hands or recorded vote (i.e. ballot or proxy). These options will continue, but voting may also be permitted by telephonic or electronic means if a condominium has a by-law that permits such. We aren’t sure how this will work exactly, but I understand that companies are already offering these services in other jurisdictions so it shouldn’t take long for them to pop up in Ontario.

The proxy process is also changing. The proxy form will be prescribed and its use mandatory; owners will no longer be able to create their own proxies. This should speed up the registration and counting processes as the form will be standard. Also, while the proxy form must still be in writing and signed by the owner, an owner will now be able to grant a proxy for “one or more particular meetings of owners”. This could be useful for snowbirds or others who know they will be away for a few months and wish to appoint a proxy before they leave.

Loss of the Right to Vote

Section 49 of the Act currently states that an owner is not entitled to vote at a meeting if they are in arrears for 30 days or more at the time of the meeting. This isn’t changing, but there are numerous amendments to make it clear that the loss of the right to vote applies to more than just ordinary motions at an AGM, like the election of directors. For instance, the owner will be unable to consent to dispense with the audit requirement (s.60), an amendment to the declaration or description (s.107), or to terminate the corporation on sale of the property (s.124).

Who gets to vote?

Unless the Act indicates otherwise, all questions at an owners meeting shall be determined by a majority of the votes cast by the owners at the meeting.  There is debate among lawyers as to the number of votes needed for certain matters, such as by-law or declaration amendments. Is it just the residential and commercial units, or do the owners of parking units get to vote as well? Does it depend upon the type of amendment (i.e. declaration, by-law, or rule).

The third draft regulation attempts to address this issue. It includes a lengthy, complex, and confusing section to determine the appropriate group for voting at owners’ meetings. Section 1.1, as proposed, states that a reference to a portion of units shall be interpreted as a reference to a portion of : a) owner-occupied units (if for the election or removal of that position); b) all units, except for parking, storage, services, facilities, or mechanical installations; or c) all of the units if the units are all for parking, storage, services, facilities or mechanical installations and the owner-occupied voting rights do not apply. Not surprisingly, most of the voting requirements will include (b). One noteable exception is declaration amendments. I’m not sure what will be required for declaration amendments yet as the amendments to the Act states that the regulations could prescribe a different level of approval than currently stated in the Act (i.e. 80% or 90% of the units). Hopefully a regulation will clearly state which units are to be used in calculating the required number of votes to approve the amendment. Otherwise, this will continue to be an issue debated by lawyers.

 

Since some of the changes could be in force as early as July 1st, if you can squeeze in your AGM in the next three months I suggest you do it to avoid all of the new requirements. It will buy you some time to figure them all out before the next AGM.