NSW: Q&A Quorum Requirements for the AGM

Lot owners from NSW have questions about dealing with the quorum requirements for annual general meetings.

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

• Quorum: The minimum number of owners required for a meeting to proceed. At a general meeting, it is one quarter of people entitled to vote, or owners (and/or proxies) holding 25% or more of unit entitlement. A quorum can now be established after 30 minutes of the intended start time of the meeting if the chairperson declares a quorum. For a committee meeting, a quorum is at least one half of the members.

Table of Contents:

• QUESTION: At our recent AGM for a community association, an owner of several lots attended, but the other owner, who only owns one lot, did not. Does a quorum exist in this scenario?
• QUESTION: We had an AGM where 2 of 3 owners attended. Is this a quorum?
• QUESTION: Our Committee of 7 has been reduced to 5 members. Do we still need 4 of the remaining 5 members for a majority?
• QUESTION: We have nine elected members. Three have resigned and two other lot owners won’t attend meetings. Can the four still hold meetings and make decisions?
• QUESTION: Our Strata committee has 6 members. Can any 3 strata members form a quorum without communicating with the other strata members?
• QUESTION: What is the procedure if an electronic general meeting fails to achieve a quorum?
• QUESTION: Leading up to our AGM, our Strata Manager was holding too many proxy votes, so divvied them up to lot owners. Can this be done? Can you also explain the quorum requirements for annual general meeting?

Question: At our recent AGM for a community association, an owner of several lots attended, but the other owner, who only owns one lot, did not. Does a quorum exist in this scenario?

Answer: If the Act’s requirements are met, quorum is constituted.

The requirements for quorum at general meetings/AGMs of an Association are set out in Schedule 1, Clause 16 of the Community Land Management Act 2021 (NSW), as extracted below, so, if those requirements are met, quorum is constituted:

16 QUORUM

1. Quorum required for motion or election A motion submitted at a meeting must not be considered, and an election must not be held at a meeting, unless there is a quorum present to consider and vote on the motion or on the election.
2. When quorum exists A quorum is present at a meeting only in the following circumstances–
   
   1. if not less than one-quarter of the members of the association entitled to vote on the motion or election are present either personally or by duly appointed proxy,
   2. if not less than one-quarter of the total unit entitlement of the scheme is represented by the persons who are present either personally or by duly appointed proxy and who are entitled to vote on the motion or election,
   3. if there are 2 persons who are present either personally or by duly appointed proxy and who are entitled to vote on the motion or election, in a case where there is more than 1 member of the association and the quorum otherwise calculated under this subclause would be fewer than 2 persons.

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

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

Question: We had an AGM where 2 of 3 owners attended. Is this a quorum?

We had an AGM where 2 of 3 owners attended. Is this a quorum?

The meeting date was changed to suit the strata and therefore our proxy couldn’t attend. Is this in line with the legislation?

The notice of AGM arrived via mail Monday and meeting was rescheduled to the following Wednesday morning. Our proxy had 2 hours notice of date change. Does this notice comply?

Answer: 2 of 3 owners is the minimum quorum.

Yes, 2 of 3 owners is the minimum quorum where the quorum calculated would be less than 2 persons.

If the meeting was adjourned, it must be adjourned for at least 7 days. It appears that the notice periods have not been complied with.

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

This post appears in Strata News #585.

Question: Our Committee of 7 has been reduced to 5 members. Do we still need 4 of the remaining 5 members for a majority?

Our committee has 7 positions however 2 members have recently sold and we are now 5.

The five have decided not to fill the vacancies until the next AGM.

Our strata manager advises that for a vote on any motion, the majority required is still 4 and not 3 of the Five members. Is this correct?

Answer: You need four for a quorum, and then it’s a majority of the quorum at a meeting.

The number at the AGM is set at seven, and then there’s a vote off and you’ve got five people. So you need four for a quorum, and then it’s a majority of the quorum at a meeting.

If you’ve got five at a meeting, it’s three. If you’ve got four at a meeting, it’s three. It’s always going to be three people who are going to make up the quorum.

However, the difference is a paper strata committee meeting, where you need four because you need four of the seven.

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

This post appears in Strata News #527.

Question: We have nine elected members. Three have resigned and two other lot owners won’t attend meetings. Can the four still hold meetings and make decisions?

Answer: The answer is no

The answer is no because you don’t have a quorum if your number of lots is nine. It’s really annoying.

As a minimum, I would replace one of those spots with someone. This is a bit technical, but you can have one of those two people that are sleeper members appoint one of the four as an alternate member. The sleeper member can dial into the call or come to the meeting, open the meeting, give the alternate member and then leave.

Practically I would get someone to just turn up to the meetings.

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

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

Question: Our Strata committee has 6 members. Can any 3 strata members form a quorum without communicating with the other strata members?

Our Strata committee has six members. I am told the quorum requirement is three members.

Do the six strata members have to be notified before a meeting or decision is to be discussed or can any three strata members form a quorum without communicating with the other strata members?

Answer: This is correct.

This is correct. Quorum is at least half of the members of the strata committee. Because this strata committee has 6 members (who are entitled to vote) a quorum is comprised of at least 3 of such members.

17 Quorum

1. Quorum required for motion A motion submitted at a meeting of a strata committee must not be considered unless there is a quorum present to consider and vote on the motion.
2. When quorum exists A quorum is present at a meeting only in the following circumstances:
1. in the case of a strata committee which has only one member, if the member is present,
2. in any other case, if not less than one-half of the persons entitled to vote on the motion are present.

Notice requirements are set out in Schedule 2 of the Strata Schemes Management Act, 2015 (NSW) and yes, ALL members must be notified of the meeting:

5 Notice of meetings for other strata schemes

1. The secretary of the owners corporation of a strata scheme that is not a large strata scheme must give notice of a meeting to each other member of the strata committee at least 3 days before the meeting and to each owner.
2. Notice is to be given by displaying the notice on the notice board maintained by the owners corporation or in accordance with section 263.

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

This post appears in Strata News #408.

Question: What is the procedure if an electronic general meeting fails to achieve a quorum?

If a normal general meeting fails to have a quorum, the Strata Schemes Management Act permits a 30 minutes delay and then the meeting may proceed with whoever is present. However, what is the procedure if an electronic general meeting fails to achieve a quorum?

Answer: The SSMA makes no distinction between physical and electronic meetings, so the same rules for quorum requirements apply.

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

This post appears in Strata News #329.

Question: Leading up to our AGM, our Strata Manager was holding too many proxy votes, so divvied them up to lot owners. Can this be done? Can you also explain the quorum requirements for annual general meeting?

We have a complex comprising of 36 units in NSW.

At our recent AGM, we had proxy votes allocated to our Strata Manager.

With new Strata law directives for NSW, our Strata manager is only allowed a certain amount of proxy votes that they can represent.

The Strata Manager then proceeded to give (divvy up) these allocated (to her) proxy votes to other Lots to act as proxy on behalf of these owners.

1. Is our Strata Manager legally allowed to do this. Or should these proxy votes have become void and not included to make up a Quorum.
2. what are the quorum requirements for the annual general meeting? How many lots in a 36 unit complex are needed to make up a quorum?

Answer: At least ¼ of persons present or ¼ of unit entitlements.

Clause 26 of the SSMA 2015 deals with the appointment of proxy votes and subsection (7) states:

Limit on the 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 is 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.

The Strata Manager then proceeded to give (divvy up) these allocated (to her) proxy votes to other Lots to act as proxy on behalf of these owners.

Is our Strata Manager legally allowed to do this, or should these proxy votes have become void and not included to make up a Quorum?

In a large scheme, this would not be possible under any circumstances as proxies must be given to the secretary 24 hours before the meeting. In a non-large scheme such as yours, we also believe this is not possible in the absence of the person appointing the proxy having specifically nominated substitute/alternate proxies in case their originally appointed proxy had exceeded the legal limit.

Requirements for Annual General Meeting

How many lots in a 36 unit complex are needed to make up a quorum?

For your scheme at least ¼ of persons present or ¼ of unit entitlements:

The requirements for a quorum are set out in Sch 1 of the SSMA 2015, Clause 17.

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

This post appears in Strata News #193.

Please note: This is not legal advice. You should seek legal advice particular to your situation.

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