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NSW: Q&A Proxy and Voting Rules for Owners Corporation Meetings

The LookUpStrata Team

Lot owners from NSW have questions about dealing with proxy votes and other voting rules for owners corporation meetings.

According to Strata Community Association (NSW), here is the definition of:

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Question: In our 95 lot building, two companies hold proxies or positions on the committees. What can we do?

I live in a building with 95 apartments. A specialist disability accommodation company holds 12 apartments, with two on the executive committee, and another owner with close ties to the developers holds six or seven proxies. Under the new rules, are companies reduced to five per cent and rounded down? Do both companies hold five per cent? Can two people from one company be on the executive committee?

Answer: Company nominees and proxies are two different means of voting and two different types of limitations.

It sounds like you have two different individual owners appointing different individuals as either a company nominee or a proxy. Company nominees and proxies are two different means of voting and two different types of limitations.

A quick recap on proxy limitations in NSW.

From your comment, I expect that the other entity who holds 6 or 7 proxies meets all the above criteria.

Company nominees also have limits, which are set out below:

Noting that a power of attorney who is a family member must not be taken into account in this limitation.

In your situation, the specialist disability accommodation company (being one owner) can appoint one person to be the company nominee for all its lots. If the scheme has more than 20 lots, a person could be the company nominee of more than one company lot owner, provided they are the company nominee only for 5% of the number of lot owners for the scheme.

Breaking it down, if the scheme has ten lots and lots 1 and 2 are owned by ABC Pty Ltd and lots 3 and 4 are owned by XYZ Pty Ltd, the company proxy or power of attorney for ABC Pty Ltd could only exercise voting rights for lots 1 and 2. The same person could not also be appointed as the company nominee for XYX Pty Ld.

If the scheme has 21 lots and the remaining 17 lots are owned by different individuals, the same company nominee or power of attorney still could not be appointed for ABC Pty Ltd and XYZ Pty Ltd to exercise voting rights for lots 1, 2, 3 and 4 as together, the two lot owners are more than 5% of the total number of lot owners. Why? There are 19 total lot owners. The calculations are: 2 lot owners / 19 total lot owners X 100% – 10.5%.

If the scheme has 50 lots and ABC Pty Ltd owns lots 1 and 2, XYZ Pty Ltd owns lots 3 and 4, with all remaining 46 lots owned by different people, one person could be appointed by the company nominee for all lots 1, 2, 3 and 4, as together the two lot owners (ABC Pty Ltd and XYZ Pty Ltd) are less than 5% of the total number of lot owners. Why? There are 48 total lot owners. The calculations are two lot owners / 48 total lot owners x 100% = 4.16%.

Allison Benson Kerin Benson Lawyers E: allison@kerinbensonlawyers.com.au P: 02 4032 7990

This post appears in the August 2024 edition of The NSW Strata Magazine.

Question: To create an exclusive use by-law, is voting always based on one vote per lot, or do the unit entitlements for each owner apply?

My federation style strata block has four similar sized apartments, with two units downstairs and two upstairs. The strata plan was created in the mid 70s, and there are different unit entitlements for each lot. The unit entitlements do not reflect each apartment’s size.

Three owners want to create exclusive use by-laws for outdoor balcony and courtyard areas, however, one owner does not. To create an exclusive use by-law, is voting always based on one vote per lot or do the unit entitlements for each owner apply?

Answer: The answer is yes.

The answer is yes. To make a by-law requires a special resolution at a general meeting (see section 141 of the Strata Schemes Management Act 2015).

A special resolution is calculated based on unit entitlements (see section 5 of the Strata Schemes Management Act 2015).

Matthew Jenkins Bannermans Lawyers E: enquiries@bannermans.com.au P: 02 9929 0226

This post appears in the July 2024 edition of The NSW Strata Magazine.

Question: When should proxy forms be given to the strata manager? Is delivery required before the AGM, or can the person being the proxy deliver the form at the AGM?

Answer: For a building up to 100 lots, you can deliver the proxy form at the AGM. If the building has 100+ lots, it must be submitted at least 24 hours before the meeting.

If the building has less than 100 lots, you can deliver the proxy form at the AGM. If the building has more than 100 lots, excluding utility lots, it must be submitted at least 24 hours before the meeting. That is a hard 24 hours, not business hours. If the meeting is 6 pm Monday, you’ve got until 6 pm Sunday to send in the proxy, not 6 pm Friday. If the proxy form for a large building is handed in after the 24 hour limit, you’ve missed the time window, and the proxy goes to the next meeting.

Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547

This post appears in the March 2024 edition of The NSW Strata Magazine.

Question: If some units have defects and we all meet about repairing the defects, can these owners participate in the vote, or should they abstain?

In our 15 year old, 30 lot strata scheme, four units require rectification works due to building defects. We called a general meeting to approve a special levy to cover the cost of the work.

Can owners of the four units with defects vote at the general meeting, or should they abstain from the vote due to their vested interest?

Answer: All owners have a vested interest in ensuring that the owners corporation meets their requirements to repair and maintain its common property.

The Strata Schemes Management Act 2015 (NSW) (‘the Act’) contain no provisions that exclude owners of lots from voting on motions that relate to the owners corporation meeting its fundamental and statutory requirement to repair and maintain its common property (in accordance with section 106 of the Act).

All owners have a vested interest in ensuring that the owners corporation meets such requirements and would be required to contribute toward the special levy in question.

Tim Sara Strata Choice E: tsara@stratachoice.com.au P: 1300 322 213

This post appears in the February 2024 edition of The NSW Strata Magazine.

Question: The agenda notice for our AGM noted a 20% increase in levies. I sent my proxy. When the levy notice was received, it was actually an increase of 40%. Is this lawful?

The agenda for our AGM showed a 20% increase in levies plus three amended by-laws that required a vote. The AGM was held midweek during the day. Few people could attend. I sent my proxy for items on the agenda.

When the levy notice was received, it showed an increase of 40%. We have had no communication apart from the minutes saying it was resolved and amended. This seems manipulative. Is it lawful and within the proper procedures?

Answer: Matters can evolve out of discussions during a meeting, and therefore, not being personally present does lend itself to risks.

The secretary of a strata committee derives authority to convene meetings under:

  1. section 43(f) of the Strata Schemes Management Act 2015 (NSW) (‘the Act’) – which gives the right to convene meetings of the strata committee and owners corporation (i.e. strata committee meetings, general meetings and annual general meetings); and

  2. section 19 of the Act – which specifically gives the right to convene a general meeting at any time.

The authority to convene a meeting extends to the secretary being allowed to determine the time, date, location and method (such as holding the meeting in person, via video conference, etc.).

Schedule 1, clause 18 of the Act does stipulate that the owners corporation must only consider motions at a meeting if the requirements of the Act have been met.

For example, the right under Schedule 1, clause 4 of the Act for an owner to require a motion to be listed on the agenda of a general meeting and must provide an explanatory note of up to 300 words. If this requirement is not met, the motion should not be considered.

However, Schedule 1, clause 18 of the Act specifies that a motion to amend a motion can be moved during a meeting. This allows for fluidity during a meeting as matters are discussed, and perhaps a compromised version of the original motion can be agreed to instead of having rigidity. Perhaps new information has come to light during the meeting, which may influence the decisions people wish to make.

It is widely accepted that an amendment to a motion must not fundamentally alter the purpose of the original motion. For example, a motion to raise a special levy cannot be amended into a motion to register a new by-law, as the owners have not been given due notice of the intention to consider the by-law. They might have chosen to attend the meeting if they knew a new by-law would be discussed.

This presents a disadvantage for owners who attend the meeting via a proxy. Matters can evolve out of discussions during a meeting, and therefore, not being personally present does lend itself to risks.

It would not be unreasonable to expect that a motion considering levies could result in an amendment being moved to increase or decrease the contributions.

With that said, it is important that a budget and estimates of the levy contributions should be as accurate as possible leading into the meeting.

Tim Sara Strata Choice E: tsara@stratachoice.com.au P: 1300 322 213

This post appears in Strata News #674.

Question: Is the strata manager obliged to advise, well before the meeting, if the proxy form has been filled in correctly?

Does our strata management company have a legal or moral responsibility to advise us if a proxy form has been filled in correctly? Recently, the strata manager had plenty of time to advise the error and give us time to rectify the form, but we were not advised that it was invalid until the meeting. The vote was, amongst other things, whether to remain with this strata company.

Answer: It is up to each owner to take advice on such matters.

It is up to each owner to take advice on such matters. The strata manager doesn’t usually advise of the validity of forms before the meeting, however, if they are acting as chairperson, they will make a ruling on forms before the meeting commences.

Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547

This post appears in Strata News #670.

Question: If a husband and wife are co-owners, whose name needs to be on the proxy form and who needs to sign that proxy form?

On a submitted proxy form, the wife, as a co-owner of the lot, was indicated as the proxy for an AGM. On the night of the AGM, it was advised the wife could not attend, and the proxy was changed to the husband. The change indicated the person who initially completed the proxy form did not make the change. Is this allowed?

Answer: If the lot owner makes the change and initials the change, then sends in the proxy form, that’s fine.

It all depends on who makes the change. It would be better for the lot owner to get organised and send the proxy form in before the AGM so this question is not raised.

If the lot owner makes the change and initials the change, then sends in the proxy form, that’s fine. Let’s say the recipient of the proxy was originally the wife, and this is changed to the husband. If the husband makes that change, they’re not the one who was meant to complete the form. That’s an invalid form, and I would deal with that on the night of the AGM.

Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547

This post appears in the August 2023 edition of The NSW Strata Magazine.

Question: Should the proxy forms be given to the strata managers before the AGM, or can the person holding the proxy deliver the form on the night of the AGM?

Answer: If the building is over 100 lots, the proxy must be delivered 24 hours before the AGM.

If the building is under 100 lots, the proxy form can be delivered to the strata manager on the night of the AGM.

If the owners corporation is over 100 lots, excluding utility lots, then that proxy form has missed the 24-hour window, and it goes to the next meeting.

We are talking about a hard 24 hours, not business hours. If the meeting is, say 6 pm on Monday, they’ve got until 6 pm on Sunday to send in the proxy, not 6 pm on Friday.

Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547

This post appears in the July 2023 edition of The NSW Strata Magazine.

Question: Do lot owners have a right or the means to verify the legitimacy of proxy forms at a meeting?

Answer: It’s the role of the chairperson to validate proxies.

It’s the role of the chairperson to validate proxies. In extreme cases with difficult and challenging meetings in large schemes you may need to involve a lawyer to make that decision.

We had one meeting in a difficult building where a lawyer validated all the proxies and said “yes” or “no”. The lawyer was at the meeting as well. Usually the strata manager or the chairperson determines the validity of the proxies.

Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547

This post appears in the May 2023 edition of The NSW Strata Magazine.

Question: Can you please advise if a special resolution can take place at the annual AGM, or is a special meeting needed?

Answer: In practice, special resolutions occur at both Annual General Meetings and Extraordinary General Meetings.

A special resolution is defined under Section 5 of the Strata Schemes Management Act 2015. A resolution of the Owners Corporation is a “special resolution” if:

  1. it is passed at a properly convened general meeting, and

  2. of the value of votes cast–
    1. not more than 25% are against the resolution, or

    2. if the resolution is a sustainability infrastructure resolution–less than 50% are against the resolution.

In practice, special resolutions occur at both Annual General Meetings and Extraordinary General Meetings.

So to answer your question, yes a Special Resolution can be passed at an Annual General Meeting.

Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547

This post appears in the December 2022 edition of The NSW Strata Magazine.

Question: When seeking renovation approval, can I vote on my own bylaw?

Answer: You can’t vote on it unless you disclose your interest and the rest of the committee say that you can vote.

Yes, you can. If you were asking for a minor renovation and it was the strata committee deciding and you were a member the strata committee or if you have a pecuniary (which means monetary interest) in a motion, you can’t vote on it unless you disclose your interest and the rest of the committee say that you can vote. Provided you did that and the committee said, “Yeah, you can vote on it”, you can vote on your motion as a strata committee member for a minor renovation.

This is because every single owner has an interest in a bylaw motion, or any motion that’s put before the owners Corp. Because let’s face it, it’s going to involve common property or money, or something that’s going to affect your rights in the owners coup.

You can definitely vote on your own motion, you just need to be financial. That’s the trick, make sure you’re financial.

Allison Benson Kerin Benson Lawyers E: allison@kerinbensonlawyers.com.au P: 02 4032 7990

This post appears in Strata News #575.

Question: Is it possible for an owner to change their vote on an agenda item that they have already voted on during the same AGM?

Is it possible for an owner to change their vote on an agenda item that they have already voted on during the same AGM?

At an AGM, if Owner B votes Yes to agenda item 01. But later on during the same AGM, they change their mind and Owner B votes No to agenda item 01.

Context: There are 2 by-laws that need to be passed at an upcoming EGM, which needed to be resolved at mediation to be here (i.e. Owner A wants agenda item 01 passed and Owner B wants agenda item 02 passed – at mediation both owners agreed to pass each other’s by-law to proceed).

But sadly there is a reality where if Item 01 is passed, then Owner A could vote against item 02 – giving Owner A what they want and not what Owner B wants (going against the mediation agreement)*. In this instance, Owner B would want to change their vote on item 01 to a No.

It seems that an owner should have the right to change their mind mid-AGM.

*The number of units in the Strata scheme is small, so both have the ability to “veto” each special resolution.

Answer: Arguably, the vote could be changed before the result of the voting was announced or if there was unanimous agreement to do so.

There is no mechanism in the strata legislation to change a vote on a motion counted during a meeting, especially where the Chairperson has declared the result of voting. Arguably, the vote could be changed before the result of the voting was announced or if there was unanimous agreement to do so.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #575.

Question: If two proxy votes are handed in after the end of voting, does this invalidate all voting?

To pass a new by-law, a postal vote was held at our retirement village of 136 units. When the vote was concluded, the strata committee considered the voting invalid as two proxy votes were handed in after the voting was ended.

Are they correct in deeming the whole vote invalid? Should they have simply decided that the two proxy votes were invalid instead?

Answer: We agree that the two invalid proxies should not invalidate the whole meeting (provided quorum was achieved).

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #549.

Question: Can proxy holders address the committee speaking about an agenda item?

During a recent AGM an ex Owner was granted a proxy by the new owner of their lot to attend. This person was granted time, under the guise of a proxy holder to address the meeting to discuss insurance. The insurance was incomplete at the time the ex Owner sold. Our Managing Agent and Chairperson insist a proxy holder has all rights of an Owner. Is this correct and can a proxy address the committee speaking about an agenda item?

Answer: Like anyone else, proxy holders are entitled to make their opinion known.

There are various limitations on proxy holders, but speaking at a meeting is not one of them.

For example, under Schedule 1, clause 25(1) of the Strata Schemes Management Act, a proxy holder can even demand a poll vote just like an owner can.

Proxy holders need to be able to speak at a meeting in order to effectively participate in debates or discussions that lead to the eventual decision making. Like anyone else, they are entitled to make their opinion known.

Tim Sara Strata Choice E: tsara@stratachoice.com.au P: 1300 322 213

This post appears in Strata News #549.

Question: Is a proxy vote valid if the resident hasn’t been advised on the issue being voted on? What should the correct process be?

Answer: It depends on how the proxy form is completed.

It depends on how the proxy form is completed. If the “form authorises the proxy to vote on my/our behalf on all matters”, and the form is otherwise properly completed and observes all other legal technicalities, then yes, the vote can be counted. The form of proxy appears on the NSW Fair Trading website under Strata Scheme Forms. If it is for the appointment of a new strata managing agent or re-appointment of an existing one, Section 3 must be completed and give specific directions as to how to vote on that matter, such matter does not fall under all matters as set out under section 2 of the proxy.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #529.

Question: Our driveway requires major work. At the AGM over half the lots were missing or did not submit a vote. The missing owners were counted as voting YES. Is this correct?

I own a property in Strata. Our central driveway has not been maintained and is in need of serious repair. The only option put forward at the last AGM was for repair work of around $50,000. This could be a lot more if the underground pipes get damaged during the required work.

At the AGM only 6 out of 13 lots were in attendance or submitted a proxy for voting. Because the missing 7 lot owners did not vote, their vote was taken as a yes. This is a major repair and I think should have been voted on separately with all the relevant information supplied to lot owners and giving them a Yes or No option but with the condition that if they do not respond their vote would be taken as a No.

This is the second time this has been presented to the AGM for voting but prior to the AGM I discussed the issue with the Strata Manager and he told me that there was some special condition for this type of issue but he did nothing about it. Please advise if there is some special by-law for this type of case.

Answer: Only those in attendance in person, by proxy or by electronic vote, if applicable, should be counted towards the vote.

Only those in attendance in person, by proxy or by electronic vote, if applicable, should be counted towards the vote.

As per Schedule 1 Section 17 of the Strata Schemes Management Act 2015 the quorum of a general meeting is more than one-quarter of the persons entitled to vote. Not knowing anything further about the financial status of the owners in attendance, for example, it is assumed that 6 out of the 13 lots would indicate that there was likely a quorum for the meeting present.

The works described if the driveway is replaced like for like, would be an ordinary resolution and as per Schedule 2 Section 14 of the Strata Schemes Management Act 2015. This is decided by a majority vote of those in attendance and entitled to vote. If the 6 owners in attendance at the meeting were declared as a quorum, it is the majority of those 6 in attendance.

Those owners not in attendance should have no bearing on the decision being made if they have not submitted a vote. Based on the above sections of the Act and if the meeting was validly called and a majority of owners approved the works, the decision to proceed with the works would be valid.

You will need to consider the individual by-laws that have been adopted and registered for your particular scheme to see if there is anything in regards to your driveway.

Robert Fothergill Strata Life E: Robert@thestratalife.com.au P: 02 9456 9917

This post appears in Strata News #524.

Question: When does a motion passed at a meeting become valid?

When does a motion passed at a precinct association (or community association) meeting become valid?

Is it valid at the meeting once the motion is passed or is it not valid until the minutes of the meeting have been sent to all in attendance?

Answer: The resolution from a motion is valid as soon as it is made

As far as I am concerned, the resolution from a motion is valid as soon as it is made (i.e. the chairperson declares an outcome).

There are certain flow-on issues that come from motions (e.g. a by-law isn’t registered or in force until registered), but if you were to take a motion such as the passing of a budget or levies – the resolution would be made/valid until overturned.

Andrew Terrell Bright & Duggan E: Andrew.Terrell@bright-duggan.com.au P: 02 9902 7100

This post appears in Strata News #518.

Question: I have a car space and a home unit and I pay separate levies for each. Does this give me two votes at meetings when voting on motions?

I have a car space and a home unit for which I pay two sets of levies. They are classified as separate lots. I am under the impression these two lots allow me two votes at meetings when voting on motions.

Our strata committee consists of six lot owners. Three lot owners have car spaces and three do not. The car space owners want to paint the car spaces after 10 years of neglect. The other three members of the owners corporation committee refuse. We do not have an over 50% majority. If the three of us with car spaces were allowed two votes each, we would have over 50% vote. Is this the case?

Answer: In a general meeting you will have one vote per lot that you own, even if that lot is a utility lot such as a car space or storage space.

In the setting of a general meeting (one where all owners are invited to attend and vote), it is correct that you will have one vote per lot that you own (even if that lot is a utility lot such as a car space or storage space), as Schedule 1, clause 14(1) of the Strata Schemes Management Act 2015 (NSW) (‘the Act’) confirms that “A motion put to a meeting … is to be decided according to a majority in number of the votes cast for and against the motion with each person having one vote for each lot in respect of which the person is entitled to vote”.

However, when it comes to a strata committee meeting (one where only strata committee members are allowed to vote), each member only has one vote regardless of how many lots they own, as Schedule 2, clause 9(1) of the Act confirms “A motion put to a meeting is to be decided according to a majority of the number of the votes cast for and against the motion by the members present”.

If the motion cannot be passed by a majority of the strata committee members, you may have better luck putting the motion to a general meeting where you may get a different outcome due to the extra votes.

Tim Sara Strata Choice E: tsara@stratachoice.com.au P: 1300 322 213

This post appears in the October 2021 edition of The NSW Strata Magazine.

Question: Our caretaker who runs an accommodation business sits on the committee. They send a ‘how to vote’ sheet with suggestions for resolutions on AGM or ordinary meeting agendas. Can we stop this?

I am a lot owner of a complex for tourist accommodation. We have a caretaker contract with the same company that runs an onsite accommodation business. This person, who is correctly entitled to be on the Owners Corporation Committee, habitually sends a ‘how to vote’ sheet for resolutions on AGM or ordinary meeting agendas. There are short comments on each motion that may be construed as advice from the OC committee but often seem personal opinion. Occasionally, the correspondence has the name of the treasurer added. Owners can simply tick the recommended boxes and return them. 

Is this undue influence/bias on the voting outcome? Results certainly seem to indicate that it is. 

How can it be stopped?

Answer: There is nothing in the Act that prevents a person from distributing a how to vote card on motions at a general meeting.

Notions of undue influence or bias do not apply to voting at a general meeting of an owners corporation. This is because owners of lots do not owe any duties when they cast their vote at a general meeting and can vote in their own self-interest.

There is nothing in the Strata Schemes Management Act 2015 that prevents a person from distributing a how to vote card on motions at a general meeting. However, the general law applies so that any how to vote card should not be defamatory, contain misrepresentation or be misleading and deceptive.

If the caretaker’s how to vote sheet purports to be given on behalf of the strata committee or the treasurer when this is not correct, then the caretaker may be engaging in defamation, misrepresentation or misleading and deceptive conduct, and legal advice should be sought especially if that results in the motions passing that benefit the caretaker or the election of the caretaker to the strata committee.

It is not clear how an owner can vote at a general meeting simply by ticking boxes on the caretaker’s how to vote sheet and returning it. An owner can either appoint a proxy or vote by pre-meeting voting methods. If the owner gives a proxy, then they can indicate on the proxy form how the proxy is to vote. If the owner fills in the pre-meeting voting form, then that is how the owner is voting. If the how to vote sheet is a proxy form or a pre-meeting voting form filled in with votes, it is still up to the owner to decide whether to accept that, sign it and return the form.

Ultimately, if a majority of owners voting agree with the caretaker and no legal wrong is committed in the process, then the only option for owners who do not agree with the result is to campaign to convince enough owners to form a majority with them that is not aligned with the caretaker.

Carlo Fini Lawyer (NSW)

This post appears in the October 2021 edition of The NSW Strata Magazine.

Question: Can Owners Corporation members use their unit entitlements when calling a poll vote to form a strata committee?

Answer: In some circumstances, the motion can be decided according to the value of unit entitlements voting for or against.

In short, yes. Generally, a motion put to a meeting, or an election of officers of the owners corporation or members of the strata committee is to be decided according to a majority of votes of owners voting for or against based on one vote per lot.

However, if a poll is demanded by a person present and entitled to vote on a motion or for the election of officers of the owners corporation or members of the strata committee at the meeting, the motion is to be decided according to the value of unit entitlements voting for or against.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #513.

Question: What are the voting rights on a Strata motion mid-way through a unit’s sale process when contracts have been exchanged but are yet to be settled? Who is the voting party under these circumstances?

Answer: The voting party is the registered owner on the strata roll at the time the vote is conducted.

The voting party is the registered owner at the time of the vote being conducted. If you owned an apartment and I bought the apartment from you and we’ve exchanged, the settlement’s not due till September and a meeting is held in August, you will have the vote as the current owner. I don’t become an owner until I have settled. It’s the registered owner on the strata roll at the time the vote is conducted, being the time that the meeting is convened.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #501.

Question: My wife and I are co-owners. Do we really have to submit proxy forms for the other when only one of us attends a meeting?

My wife and I are co-owners. My reading of the act is that if one of us is not at the meeting then the other speaks and votes for us. The management says no, I must give her written proxy each time I am not there because my name is written first in the ownership document. Is that right? we are equal owners.

Answer: There are proxy rules in the case of co-ownership.

In case of co-ownership, the proxy may be one of the co-owners (or someone else) OR if no other co-owners show up, the co-owner who actually showed up OR if more than one co-owner turns up, they all consent to one of them being proxy OR if they don’t consent, the first named on the strata roll.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #498.

Question: What are the voting rights of a majority lot owner when a poll vote is called at an Owners Corporation meeting?

I own one lot in a duplex strata scheme and hold 60% of the unit entitlements.

In our scheme, for an ordinary resolution, does the majority rule apply if a poll is called at an Owners Corporation meeting? In particular, where there are strong differences of opinion as to the necessity/timing of capital works to be included in the CWFP will the majority prevail?

If yes, what recourse does the minority unit entitlement holder have, if any, to object to the resolution?

Answer: As with a lot of things in strata management the majority rules

As with a lot of things in strata management the majority rules and as per Schedule 1, Section 14 of the Strata schemes Management Act 2015 all motions are to be voted on by simple majority with each person having one vote.

However as you have stated if a poll vote is called by a person entitled to do so then the voting value of the vote is equal to the unit entitlements of that lot. So with 60% of unit entitlements that would be a majority.

As detailed on Section 14(4), below for ease of reference, a poll can be demanded immediately before or after a vote is taken.

If the minority unit entitlement owner does not agree with a decision, they always have the right to apply for Mediation Services through NSW Fair Trading and subsequently for consideration at the NSW Civil and Administrative Tribunal if an agreement cannot be reached at mediation.

STRATA SCHEMES MANAGEMENT ACT 2015 – SCHEDULE 1

14 Decisions at meetings

  1. Simple majority vote to generally apply: A motion put to a meeting, or an election of officers of the owners corporation or members of the strata committee, is to be decided according to a majority in number of the votes cast for and against the motion with each person having one vote for each lot in respect of which the person is entitled to vote.

  2. Vote of original owner who owns more than half of lots to be reduced: For the purposes of determining an election for officers of the owners corporation or members of the strata committee or appointing a strata managing agent (other than in the case of a poll), if the total unit entitlement of lots of the original owner is not less than half of the aggregate unit entitlement, the value of the vote in respect of the lots held by the original owner is taken to be reduced by two-thirds (ignoring any fraction).

  3. Value of votes to apply for poll: If a poll is demanded by a person present and entitled to vote on a motion or for the election of officers of the owners corporation or members of the strata committee at the meeting, the motion is to be decided according to the value of the votes cast for and against the motion and the value of a vote cast by a person entitled to vote in respect of a lot is equal to the unit entitlement of that lot. However, the value of the vote of an original owner is to be calculated in the same way as for a special resolution.
    Note— Section 5 sets out the manner in which a special resolution is determined.

  4. Polls: A poll may be demanded immediately before or after a vote decided by a majority in number has been taken. The demand for a poll may be withdrawn by the person who made it

Robert Fothergill Strata Life E: Robert@thestratalife.com.au P: 02 9456 9917

This post appears in Strata News #497.

Question: Is this general meeting valid? What about the quorum?

We have just had an EGM stated as (DATE) with pre-meeting voting closing (24 HRS PRIOR).

The notice of the meeting was misleading. On one side of the header, it says:

The meeting will be held on (DATE) via electronic vote commencing at (TIME)

Next to that it says:

Should you be unable to attend the scheduled meeting, you are encouraged to complete the Proxy Form and return to the office of ______ at least 24 hours prior to the commencement of the meeting.

As it was unclear, I rang the Strata Manager to ask if there was an actual meeting. He said no. I asked how that can work if votes are to be counted, motions passed, and minutes produced.

He said the Strata Managers do it, the votes act as proxies.

Is it correct that there doesn’t have to be a meeting of the Owners Corp following the electronic vote?

Isn’t there a need to have a quorum of owners?

Answer: The owners corporation may, by resolution passed at a general meeting, determine that a vote may be cast by some other specified means.

The owners corporation may, by resolution passed at a general meeting, determine that a vote may be cast by some other specified means. On the assumption that your owners corporation has done so, no physical meeting needs to take place and yes, any meeting (however held) must have a quorum.

As an owner, you have the right to make an application to NCAT for Orders to invalidate a resolution of or election held by the Owners Corporation if there has been a breach of the strata legislation but NCAT has the discretion not to do so if the failure did not adversely affect anyone and if compliance with the strata legislation would not have made a difference to the outcome of the voting.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #495.

Question: Can a proxy vote be cast in AGM elections for Owners Corporation committee members?

Can a proxy vote be cast in AGM elections for Owners Corporation committee members? If Yes:

  1. The person granting a proxy to another person may not know who the committee candidates are, as candidates can be nominated as late as the AGM itself.

    2. Each incumbent committee member who be able to hold up to 5% of owners as proxies, which in a seven-member committee, would be up to 35%, giving them a very good chance at self-renewal if proxies are cast for each other.

Answer: Yes, however, at the AGM the nominations are taken and the number of committee members is determined.

Yes, however, at the AGM the nominations are taken and the number of committee members is determined. It is the strata committee meeting immediately following the AGM which determines the office bearers and the balance remain members of the committee and there are no proxies at strata committee meetings.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #463.

Question: At a Committee meeting (not an owners corporation meeting), can a Strata Committee member have another committee member act as their proxy if they know they will be absent from the meeting?

Answer: Not as a “proxy” per se, but effectively, yes, with the consent of the strata committee.

Not as a “proxy” per se, but effectively, yes, with the consent of the strata committee, as per the section below:

34 Acting members of strata committee

  1. A member of a strata committee may, with the consent of the strata committee, appoint an owner or company nominee of a corporation that is an owner who is eligible to be a member to act in his or her place as a member at any meeting of the strata committee.

  2. The owner or company nominee appointed is, while so acting as a member, taken to be a member.

  3. An owner or company nominee of a corporation may be appointed whether or not he or she is already a member of the strata committee.

  4. If a person so appointed is a member of the strata committee, the person may, at any meeting of the strata committee, separately vote in the person’s capacity as such a member and on behalf of the member in whose place the person has been appointed to act.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in the March 2021 edition of The NSW Strata Magazine.

Question: How many owners in a complex of 12 units are required to vote against a motion at an extraordinary general meeting.

Answer: It depends whether you are asking about a unanimous, special or ordinary resolution.

It depends whether you are asking about a unanimous, special or ordinary resolution. No one can vote against a unanimous resolution for it to pass. With a special resolution no more than 25% of the value of votes cast can be against the resolution. An ordinary resolution only requires a simple majority.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #433.

Question: I was told AGM vote was not valid as I had sent it in 12 hrs before instead of 24 hours. Why are the rules around voting at AGMs so strict?

My ballot vote for our AGM was rejected as I sent it in 12 hrs before instead of 24 hours before, so I was told it was no longer valid. 

I had no idea the rules around this were so strict? Is there anything else I can do to have my vote considered?

Answer: Unfortunately, in your case, your vote was submitted after the deadline and therefore could not be counted.

Under Regulation 15 of the strata regulations, the secretary of the owners corporation must give information about the “closing date” of the ballot for pre-meeting electronic voting. Under sub-section (8) “close of the ballot”, for a meeting of the owners corporation, is defined to be 24 hours before the commencement of the meeting.

Unfortunately, in your case, your vote was submitted after the deadline and therefore could not be counted. Now that you are aware of this legislative requirement, please ensure you submit your notes no later than 24 hours before the commencement of the meeting and vote otherwise strictly in accordance with the instructions provided to you.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #433.

Question: Can a proxy vote be voted out by other members at a Strata meeting.

Answer: No, a proxy vote cannot be ousted by other owners at a general meeting because all owners are entitled to vote in person or by proxy.

No, a proxy vote (unless the proxy vote is ruled out of order or invalid) cannot be ousted by other owners at a general meeting because all owners are entitled to vote in person or by proxy (unless the owner turns up and wishes to vote in which case the proxy cannot vote).

Further, if the proxy holder hold proxies in excess of the permitted maximum, then such excessive proxies will be invalid.

For further information see: NSW Fair Trading, Meetings of the Owners Corporation

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

Question: Can a vote on a decision be raised after a decision and expense has occurred? Under what circumstances does a decision require a special resolution? And who decides a special resolution is appropriate?

Answer: Once an expense has been incurred and paid for it is difficult to reverse

Once an expense has been incurred and paid for it is difficult to reverse and usually, the only decision that would arise, is a decision to ratify the incurring of an expense.

The strata legislation dictates which decisions must be made by special resolution. Examples of decisions requiring a special resolution include by-laws for owners carrying major renovations, management by-laws, exclusive use of common property by-laws, leasing of the common property, creation of easements, strata plans of subdivision, alterations to the common property.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #406.

Question: As a special resolution is carried if “not more than 25% of the value of the votes cast are against the resolution”, can I confirm that “not more than 25% against” is different from “75% or more in favour”?

The Act says a special resolution is carried if “not more than 25% of the value of the votes cast are against the resolution”.

I would like to confirm that if 4 people (with equal lot entitlements) cast votes with 3 in favour and 1 against, the special resolution motion is lost.

In other words, “not more than 25% against” is different from “75% or more in favour”. The reasoning as that 25% is not more than 25%.

Answer: Not more than 25% against is a lower threshold than at least 75%.

Your reasoning is correct – not more than 25% against is a lower threshold than at least 75% as in company law.

In your case, not more than 25% voted against, (only 25% voted against) therefore the motion carries.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This article is not intended to be personal advice and you should not rely on it as a substitute for any form of advice.

This post appears in Strata News #380.

Question: Do the changes in the Strata Schemes Management Act limiting the number of proxy votes an individual may hold also apply under the Community Land Management Act?

Do the changes in the Strata Schemes Management Act limiting the number of proxy votes an individual may hold also apply under the Community Land Management Act? I live in a Neighbourhood Association and want to be clear as to how many proxy votes an individual may hold under the Community Land Management Act, but cannot find this in the Act.

Answer: We are not aware of any corresponding anti-proxy farming amendments having been made to the Community Land Management Act or Regulation.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #375.

Question: Absent owners provide a signed proxy voting form which is then handed out to individuals within the meeting. Is this legal?

I have an interesting question regarding Proxy votes.

Our Strata contains a number of owner born overseas that are not interested in attending meeting AGMs or EGMs.

One individual persuades these owners to provide a signed Proxy Appointment Form but without completing the Proxy voting details on the form.

At the meeting or immediately prior he hands out these forms to persons he chooses and has them place their name as the proxy Appointed. Thus he provides himself with control of the voting and has indeed a gerrymander over that meeting. The managing agent who chairs these meetings has said there is nothing illegal and proceeds with the meeting.

I am of the opinion that the Managing Agent is incorrect and indeed this would be illegal and tantamount to fraud. I am unable to locate any reference to this behaviour in the Strata Act of NSW 2015, would appreciate your opinion.

Answer: As there is no default person appointed as a proxy, the proxy could be subject to challenge.

Schedule 1 of the Strata Schemes Management Act, states “26 Appointment of proxies

Duly appointed proxy A person is a “duly appointed proxy” for the purposes of this Part if the person is appointed as a proxy by an instrument in the form prescribed by the regulations and the form is signed by the person appointing the proxy or executed in any other manner permitted by the regulations.

In our view, as no “person” is actually appointed as a proxy and as there is no default person appointed as a proxy, the proxy could be subject to challenge.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #238.

Question: At our recent AGM, a husband and wife owner of one of the units EACH took a proxy giving them 2 proxy votes for their 1 lot. Is this allowed or is it a maximum of 1 proxy per lot?

I am in an NSW Strata building with 9 lots.

We have just had our AGM where we voted in a new committee.

I am aware that each owner can now only carry 1 proxy vote each.

A husband and wife owner of one of the units EACH took a proxy – therefore they had 2 proxy votes from 2 other owners against their 1 lot.

Is this allowed or is it a maximum of 1 proxy per lot?

If it is a maximum of 1 proxy per lot, our ballot voting is therefore invalid, and can we do a re-vote at a Special General meeting? If this is required, how would it work? How would we conduct this and what would be the rules around it?

Answer: This is allowed because the limitation for proxy votes attaches to the person, not the lot.

In our view, this is allowed because the limitation for proxy votes attaches to the person not the lot and there is a specific exception for co-owners:

See Section 26 (7) below:

26 Appointment of proxies

  1. Limit on number of proxies that may be held The total number of proxies that may be held by a person (other than proxies held by the person as the co-owner of a lot) voting on a resolution are as follows:
    1. if the strata scheme has 20 lots or less, one,

    2. if the strata scheme has more than 20 lots, a number that is equal to not more than 5% of the total number of lots.

Or is it a maximum of 1 proxy per lot?

No. Proxy votes are per person.

Given our view, no invalidation will be relevant/required.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This post appears in Strata News #215.

Question: Are the following forms available for download – Notice of Annual General Meeting and Proxy Voting Forms?

Answer: The legislation mandates various matters which must be included on a notice for an Annual General Meeting.

Here is a link to a printable PDF of a Proxy Appointment Form – including some notes on how the form can be used.

There is no standard template that we can offer as our templates are used for our business purposes, however, the legislation mandates various matters which must be included on a notice for an AGM (other than the 1st AGM), eg in Schedule 1 of the SSMA:

Clause 4 – 4 Inclusion of matters on agenda (1) & (2)

Clause 5 Nomination of candidates for election prior to meeting (1)

Clause 6 Required items of agenda for AGM (a) – (d)

Clause 7 Notice of general meetings other than first AGM (1) – (4)

Clause 8 Matters that must be included in notice of general meetings (1) & (2)

Clause 9 Additional matters to be included in notice of AGM (a) – (i)

We hope this information is helpful.

Leanne Habib Premium Strata

This post appears in Strata News #196.

Question: What information is included on NSW Proxy Voting Forms?

I own an apartment in a strata complex in NSW.

May I ask about proxy voting forms?

I notice that the firms that are sent to owners so they can make a choice to lodge proxy votes do not allow for the owner to make a decision on how they would like their vote to go on each agenda item or certain issues.

If you sign over your proxy vote, the person you nominate gets to decide on the vote.

Is that the usual process?

How is that fair?

Also, as an executive committee member, is there any legal reason that prevents me writing to other owners as I am fast becoming aware that a significant number are not receiving correspondence about meetings and agenda items?

Answer: The NSW Proxy Voting Forms are governed by the Strata Schemes Management Regulation 2016.

The form of proxy is governed by the Strata Schemes Management Regulation 2016.

You should compare the Regulation Form to the proxy forms provided to you. Clearly, the lot owner may direct the proxy how to vote.

Though we are not lawyers, in terms of writing to the individual owners, it is preferable to seek a qualified request for the matters to be considered at a general meeting.  As you are a strata committee member, perhaps you could raise your concerns there.  As a last resort, you could seek mediation and proceed to application for Orders from NSW Civil and Administrative Tribunal (NCAT). You should exercise caution when phrasing your concerns to avoid issues such as defamation etc arising.

Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440

This article is not intended to be personal advice and you should not rely on it as a substitute for any form of advice.

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