BC Provincial Government Increases Options for Holding General Meetings
Alex J. Chang, Associate
Phone: 604-685-1255
Email: ajc@lmlaw.ca
In response to the COVID-19 pandemic, many strata corporations made the responsible choice to cancel or postpone in-person annual or special general meetings. The budgets and council composition of those stratas remain in effect until the AGM proceeds.
However, as the public state of emergency has dragged on, many strata councils and owners have become increasingly concerned that they cannot postpone passing new budgets and other important resolutions any longer. Section 40(2) of the Strata Property Act (SPA) also states that a strata must hold its AGM no later than two months after its fiscal year-end.
While there are standard bylaws that most strata corporations have to allow holding virtual council meetings, there is no such standard bylaw that allows for virtual general meetings.
Strata corporations that wanted to proceed with general meetings but are concerned about social distancing have three options:
- All owners may unanimously waive the requirement to hold an AGM in writing per s. 41 of the SPA. However, this option is unlikely to be practical for large strata’s or smaller stratas where owners cannot consent on all the resolutions.
- Strata’s may call a general meeting with instructions to owners to submit a restricted proxy.
- Per an order on April 15, 2020, under the Emergency Program Act, strata are now authorized to host all their meetings electronically, including general meetings, during the provincial state of emergency so long as the electronic method permits all persons participating in the meeting to communicate with each other.
The emergency order overrides s. 49 of the SPA, which provides that a strata must have a bylaw to allow for an electronic general meeting. Stratas that want to have electronic meetings after the state of emergency is lifted will need to pass bylaws to that effect.
The passage of the emergency order, likely means that strata corporations should also proceed with their AGM’s, particularly if they are approaching or past their fiscal year-end.
Proceeding with a meeting electronically or by restricted proxy requires careful planning.
A general meeting that uses restricted proxies requires eligible voters to fill out and return a restricted proxy form that is provided as part of the meeting notice package. It enables the voter to instruct the person to whom the proxy is given (typically a council member) how to vote on each resolution on the agenda. The proxy form must be customized based on the agenda items, including who is standing to run for the council. A conference call or online meeting can be held in advance of the general meeting to allow for discussion and questions. If all voters submit their proxies to a single person that one person can then hold the meeting by themself and record the votes based on the proxies. While owners should be strongly encouraged to submit a proxy instead of attending in person, the meeting should be held in a space where social distancing is possible in case some voters decide to attend. The chair must also be prepared to cancel the meeting if too many voters do attend in person, making social distancing impossible.
An electronic meeting avoids the prospect of owners insisting on attending in person because under the emergency order and s. 49 of the SPA, a person who attends a meeting electronically, is deemed to be there in person. However, electronic meetings also come with their own logistical issues. For example, the Standard Bylaws entitle voters to insist on a secret ballot. Strata corporations that choose to proceed with electronic general meetings will need to be prepared for these logistical challenges before proceeding.
Strata corporations that elect to proceed with a novel way of convening a general meeting should seek legal advice before issuing their notices.
WHAT WE DO: Lesperance Mendes would be pleased to assist your strata corporation in responding to issues regarding COVID-19 and calling general meetings. To make an appointment, please contact Paul G. Mendes, Alex J. Chang, or Amanda Magee.
Caution: As the circumstances surrounding the COVID-19 pandemic is rapidly evolving, we encourage readers to monitor official government and court websites and seek current legal advice based on their particular circumstances.
THIS ARTICLE IS NOT LEGAL ADVICE: This article provides general information and should not be relied upon without independent legal advice with respect to the specific facts of your case.