Update January 9, 2017: the BC Supreme Court Decision in Yang v. Re/Max Commercial Realty Associates (482258 BC Ltd.), 2016 BCSC 2147 has updated the law on this topic. Although the Court concluded that elections by acclamation are permissible under the Strata Property Act (SPA), the judge, in that case, observed as follows at paragraph 115:
“…given the uncertainty over this issue and the potential acclamation of a nominee to the council that the majority do not support, it is better practice to avoid elections by acclamation and require a vote where a majority has not approved a resolution to have an election proceed by acclamation.”
Although the case determined that a council elected by acclamation does not contravene the SPA, the decision recommends avoiding elections by acclamation unless there is a majority vote to approve the acclamation.
Over our years of attending general meetings, we have observed some common practices during strata corporation and section elections that, surprisingly, do not comply with the Strata Property Act (the “SPA”):
(1) elections by acclamation;
(2) “first past the post” elections; and
(3) bylaws that reserve a certain number of spots on the council for certain owners.
Some of these practices are informed by our experience with elections generally, and some of them are motivated by perceived fairness.
The starting point is s. 50, which says that all matters at a general meeting must be decided by majority vote “…unless a different voting threshold is required or permitted by the Act or the regulations”. This section has two obvious implications:
(1) since an election is a “matter” being decided at a general meeting, there must be a vote; and
(2) to be elected to the council or the executive you must have a “majority” of votes, which means “more than half” of the votes cast (note: abstentions are not counted).
Many strata have trouble getting enough people to run for council and usually the same people end up being elected by “acclamation” each year. In those cases, the correct way to elect the council will be to call for a motion from the floor to elect or appoint those individuals to the council. That motion must be approved by a majority vote to pass. But what if the motion is defeated? This can happen if one or more of the candidates are unpopular. In such a case the chair must call for an election and the owners will have to cast a vote for their preferred candidates.
Again, because the election is a “matter” being decided, only the persons with more than half of the votes will be elected. People who do not get the required votes are not elected.
This can cause confusion in strata where elections are hotly contested. In those strata, the practice has been to run “first past the post” elections. In those cases, the “top seven” candidates are elected to council even when one or more of them fail to get the requisite majority vote. Under s. 50, that practice is clearly wrong and candidates who do not get a majority vote are not elected to the council.
If s. 50 is applied correctly to contested elections, this can result in vacant positions after the election.
If some positions remain unfilled, the chairperson of the meeting has three options:
(1) leave the positions vacant;
(2) call for a motion to appoint those candidates to the council who finished in the top 7 but failed to get a majority vote; or
(3) call for a runoff election to fill the vacant seats.
It would also be a good idea to reopen nominations to fill the vacant positions.
Everything I say above applies to section executive elections too.
Speaking of sections, however, the other implication of s. 50 is that bylaws providing for automatic appointments for certain owners to council do not comply with the Act. I call those “special privilege” bylaws.
The most common special privilege bylaws are those that say “…one position on a council is reserved for the commercial owner” or “the council shall consist of at least 4 residential strata lot owners”. Special privilege bylaws remove some owners’ right to vote on what can be one of the most important matters at a general meeting. This clearly contravenes the Act.
Where those bylaws are in existence, the chairperson should call for a majority vote to ratify the appointment of the special privilege candidate and the council should be advised to obtain a legal opinion on whether the special privilege bylaws are valid. This same procedure should be followed when the bylaws or past practice says that the representatives from the section executives are appointed to the council. Any bylaw that restricts an owners’ right to vote is unlawful under the Act. The only permitted bylaws that may restrict voting are those passed pursuant to s. 53(2) which allows the strata to have a bylaw stating that the vote for a strata lot may not be exercised, except on matters requiring a unanimous vote, if the strata corporation is entitled to register a lien against that strata lot under section 116 (1).
Introducing these changes to elections sometimes meets with resistance. Some owners will protest that they have always conducted their meetings a certain way and they do not wish to change. Those owners must be reminded that doing things contrary to the Act is fine until there is a legal dispute about the outcome of a meeting. When a legal dispute happens, the Court’s preference will always be to uphold the Act.
Minority owners who benefit from the special privilege bylaws will also protest that changing the past practice is unfair because they may not get sufficient votes to be elected to the council. Those owners must be reminded that every owner is in the same boat. The Act treats all owners the same in respect of most things but not all. When it comes to elections, however, all owners are created equal.
WHAT WE DO: Lesperance Mendes advises strata councils and property managers on a wide range of strata property law issues, including how to run and plan for contentious general meetings. We are also skilled at chairing hotly contested or controversial general meetings. If your strata have a meeting coming up that may benefit from an “outside person” act as the chairperson, consider having one of our lawyers attend. For more information about this or any other strata law topic or question, contact Paul G. Mendes at 604-685-4894 / pgm@lmlaw.ca
Lesperance Mendes Lawyers
900 Howe St #550, Vancouver, BC V6Z 2M4
(604) 685-3567