SA: Q&A Strata Voting Rules, Majority Votes and Proxies

We received these questions about strata voting rules for proxy voting from lot owners in SA. Information concerning this topic has been supplied by Flavia Ger, Alice Rogers-Ross and Tyson D’Sylva, Ace Body Corporate Management.

Table of Contents:

• QUESTION: Can non-owners be a proxy committee member in SA?
• QUESTION: In a large strata title building in SA, one unit has husband and wife joint owners. They both took proxies, both voted and jointly controlled the meeting. Was the meeting valid?
• QUESTION: We have a Management Committee with 5 members. How do I calculate a majority vote if all 5 members are in attendance?
• QUESTION: In our three unit complex, the other two owners outvote me on any decision regarding maintenance. Can I file a complaint with someone?
• QUESTION: I understand that the Strata Manager has the duty to table the proxies they hold, but how should proxies be tabled at an online meeting?
• QUESTION: Who wins in a small scheme where there are 2 votes for and 2 votes against a resolution?
• QUESTION: I own 2 out of 18 units in my Strata block. I am a member of the committee. Am I only considered 1 person within the committee for voting etc?
• QUESTION: Around 75% or our lots are owned by one lot owner. If it came to a majority vote, would the majority lot owner have the deciding vote or are they considered one vote?
• QUESTION: When voting on change of strata management at the AGM, how can the strata manager vote with their proxies to keep his contract? Surely this is a conflict.
• QUESTION: I am a member of a strata title and don’t understand the strata voting rules relating to “voting on resolutions by email”.
• QUESTION: What are the regulations or guidelines with regards to how a Strata Manager should use his proxy votes at AGMs when he holds a lot owner’s proxy?




Question: Can non-owners be a proxy committee member in SA?

A lot owner’s family member resides permanently in the unit. They are a proxy for the lot owner at meetings. The proxy is renewed yearly for the family member to be a committee member. Can non-owners be committee members in SA?

Answer: If the units are used for residential purposes, no. A person who is not an owner cannot form part of the committee.

Simply put, if the units are used for residential purposes, no. A person who is not an owner cannot form part of the committee.

Both the Strata Titles Act and Community Titles Act do allow proxies to be given to others to attend the committee meetings. However, they must be a unit holder if the lots are used for residential purposes.

The Strata Titles Act states that if ALL units are used for non-residential purposes, the committee may include persons who are not unit holders. The Community Titles Act states that if 1 or more lots are used for non-residential purposes, the committee may include non unit holders.

Strata Titles Act

35—Management committee

1. Subject to subsection (1a), a strata corporation may, by ordinary resolution, appoint a management committee of unit holders.
   
   1. Where all of the units comprised in the strata scheme consist of non-residential premises, the management committee may consist of, or include, persons who are not unit holders.

7. A member of a management committee can appoint another person (who must, unless all of the units comprised in the strata scheme consist of non-residential units, be a unit holder) to act as his or her proxy at any meeting of the committee that the member is unable to attend.

Community Titles Act

90—Establishment of management committee

4. Subject to subsection (6), where each of the community lots is used, or is intended to be used, solely or predominantly for residential purposes, all the members of the committee must be members of the corporation and for that purpose a person for the time being appointed by a body corporate that is a member of the corporation to attend and vote at meetings of the corporation will be taken to be a member of the corporation.
5. Where one or more of the community lots are not used, or intended to be used, sole or predominantly for residential purposes, the committee may be comprised of or include persons who are not members of the corporation.

Carrie McInerney
Horner Management
E: carrie@hornermanagement.com.au
P: 08 8234 5777

This post appears in Strata News #716.

Question: In a large strata title building in SA, one unit has husband and wife joint owners. They both took proxies, both voted and jointly controlled the meeting. Was the meeting valid?

Answer: The Act does not stipulate that 1 single owner cannot hold multiple proxies and in fact, the meeting can still proceed if one party holds all proxies.

If another owner provided a proxy to the husband and the wife voted on behalf of the unit they own (or vice versa) this is completely legal. The meeting is considered to have a quorum if 50% or 50%+1 in Community Titles are present. The Act does not stipulate that 1 single owner cannot hold multiple proxies and in fact, the meeting can still proceed if one party holds all proxies.

Carrie McInerney
Horner Management
E: carrie@hornermanagement.com.au
P: 08 8234 5777

This post appears in Strata News #663.

Question: We have a Management Committee with 5 members. How do I calculate a majority vote if all 5 members are in attendance?

We have 7 units in our Strata Corporation. We have a Management Committee with 5 members. How do I calculate a majority vote if all 5 members are in attendance (albeit 1 by Proxy)?

According to Strata Titles Act 1988 s35(4b), the management committee uses 50% plus 1. This equals 3.5. I have been using 3 as the majority vote. However, another point of view is that it is 4. Which is correct?

If it is 4, will that prevent progress on decision making? We have 2 members who always side with each other and are very obstructive. One of the members does not attend in person and so miss the discussion and the reasons behind a proposal/resolution. She has provided her proxy to an attending member. There would be no point in having a management committee in this scenario.

Answer: The prescribed number for the purposes of a quorum is a number ascertained by dividing the total number of members of the committee by two, ignoring any fraction resulting from the division, and adding one.

Section 35 (4a) of the Strata Title Act states that the prescribed number for the purposes of a quorum is a number ascertained by dividing the total number of members of the committee by two, ignoring any fraction resulting from the division, and adding one.

This means that with 5 on the Management Committee you are required to have 3 members present.  The wording states you need to ignore the fraction and then add one, so you still have 50%.  Part 7 of the same section states that a member of the management committee can appoint another person who must be a unit holder (if all units are residential) to act as their proxy if they cannot attend, so in the case you have stated the proxy is allowed.

There is no scope in the Act to remove a member from the committee because they do not attend, especially if they are still providing a proxy.  As the owners are siding with each other, it is likely that, if they were physically attend the meeting, the result would be the same.

Carrie McInerney
Horner Management
E: carrie@hornermanagement.com.au
P: 08 8234 5777

This post appears in Strata News #662.

Question: In our three unit complex, the other two owners outvote me on any decision regarding maintenance. Can I file a complaint with someone?

I own a unit of three units in our complex. The other two owners gang up on me when we are voting on any decision regarding maintenance issues in the complex.

Can I file a complaint with someone? Our Strata management is not assisting at all.

Answer: If you are being outvoted by other owners and believe that there is a real need to carry out the maintenance, you can make an application under the Act.

It is the Strata Corporation’s responsibility to administer and maintain the common property for the benefit of the unit holders, and to such extent, as may be appropriate, other members of the strata community.

If you are being outvoted by other owners and believe that there is a real need to carry out the maintenance, you can make an application under Section 41A 1(c) of the Strata Title Act 1988 “if a member of a strata corporation claims that a decision of the strata corporation or a delegate or the management committee of the strata corporation is unreasonable, oppressive or unjust”.

If you do not want to proceed in the Magistrates Court, you could try a community mediation to assist in discussing the issues you are experiencing.

Carrie McInerney
Horner Management
E: carrie@hornermanagement.com.au
P: 08 8234 5777

This post appears in Strata News #627.

Question: I understand that the Strata Manager has the duty to table the proxies they hold, but how should proxies be tabled at an online meeting?

Our Strata is covered under the Strata Titles Act 1988. Most of our AGMs have at least 50% of owners phoning into the meeting. What is the best practice that Strata Manager should apply when handling proxies.

I understand that the Strata Manager has the duty to table the proxies they hold, but how should proxies be tabled at an online meeting?

Answer: The question of best practice in handling proxies is the same regardless if you held a meeting in person or via any other form of technology.

The question of best practice in handling proxies is the same regardless if you held a meeting in person, on the phone or via any other form of technology.

All proxies should be received by the manager by the appointed time and should be clearly and correctly completed.

If the Strata Manager or another appointed proxy is the elected proxy for the owner, the manager / or other appointed proxy should read out how the owner is to vote on each item. If owners have attended in person, they can request to sight the proxies.

If the owner has not written their decision on the proxy for an item, the manager should advise that the owner has abstained and not cast their personal vote.

Should the meeting be a full electronic meeting via a website and there is no owner interaction, the manager will record the owner’s decisions on the minutes and the proxies, upon request, can be made available for owners to site.

As always, if you feel something is not right, speak to your manager and or committee members on the process. Working together is a better outcome for your community.

If you still have further questions you may be able to raise this with the industry association Strata Community Association (SCA)

Tyson D’Sylva
Ace Body Corporate Management
E: tyson.d@acebodycorp.com.au
P: 08 8342 1544

This post appears in Strata News #611.

Question: Who wins in a small scheme where there are 2 votes for and 2 votes against a resolution?

At our Body Corporate, a vote has been cast for work to be done on the common property building. There are four (4) units and the votes came in at 2 for and 2 against the resolution. What does this mean in relation to the carrying out of the proposed work?

Answer: You require a majority decision.

Under the Strata Titles Act, an ordinary resolution is defined as a resolution passed at a properly convened meeting of the corporation by a simple majority of the votes of unit holders present and voting on the resolution;

Our interpretation of this is that you require a majority decision, as there were two votes in favour and two against, there is no clear majority and therefore the motion has failed.

Carrie McInerney
Horner Management
E: carrie@hornermanagement.com.au
P: 08 8234 5777

This post appears in Strata News #606.

Question: I own 2 out of 18 units in my Strata block. I am a member of the committee. Am I only considered 1 person within the committee for voting etc?

Answer: Under the section 34 of the Strata Titles Act, each unit is entitled to one vote (if financial). If you own two lots, you have 2 votes.

Under the section 34 of the Strata Titles Act, each unit is entitled to one vote (if financial). If you own two lots, you have 2 votes.

However, voting also depends on the type of decision and resolution being proposed. As per the Act, section 35 (3), a management committee do not have the authority to make decisions on resolutions that require special or unanimous approval.

Only Ordinary motions can be approved by a majority vote and at the committee level, our understanding is that you would have one vote at this level for Ordinary motions.

For more information on voting, please refer to the Strata Titles Act 1988 or speak with your strata manager as they might be able to provide more information on a particular vote being proposed and your rights.

Flavia Ger
Ace Body Corporate Management
T: 08 8342 1544
E: flavia@acebod.com

This post appears in Strata News #401.

Question: Around 75% or our lots are owned by one lot owner. If it came to a majority vote, would the majority lot owner have the deciding vote or are they considered one vote?

I live in a unit block in SA and we are managed by a strata manager. Around 75% of the units are owned by the local council.

I was wondering whether if it came down to a majority vote, would the appointed member of the council have the deciding vote (as they make up the majority of the units anyway) or, are they considered one vote?

Answer: Each unit is entitled to one vote (if financial). However, voting depends on the type of decision and resolution being proposed.

If your corporation is governed by the Strata Titles Act 1988 each unit is entitled to one vote (if financial). However, voting depends on the type of decision and resolution being proposed.

There are three types of resolutions for Strata Corporations and they are ordinary, special and unanimous.

1. For any ordinary resolution you need a simple majority. You are right to mention that since the council own a majority of the units, they will have a majority vote. This is true for an ordinary resolution and most of the decisions of the strata corporation are made by ordinary resolution.
2. A special resolution is passed at a properly convened meeting at which the number of votes (if any) cast against the resolution is 25% or less. This rule does not apply to 3 unit strata corporations. A special resolution is needed to change/ adopt articles, alterations or changing the external appearance of the units or approve special insurances.
3. A unanimous resolution means a special resolution passed without any dissentient vote at a general meeting of the corporation. A strata corporation comprised of only non-residential units may decide by unanimous resolution to adopt the voting system exercisable in respect of each unit equivalent to the unit entitlement of the unit. A unanimous resolution is required for a number of factors like acquiring, dealing with or disposing of real property; granting to a unit holder exclusive use of part of the common property for a specified period; amending the strata plan, distributing surplus funds from the sale of land etc. For more information on voting, please refer to the Strata Titles Act 1988 on resolutions or speak with your strata manager as they might be able to provide more information on a particular vote being proposed and your rights.

Also, a non-financial owner cannot vote on an ordinary or a special resolution but can vote on a unanimous resolution.

If your corporation is governed by the Community Titles Act, refer to section 84 — Voting at general meetings, Community Titles Act 1996 for a detailed explanation on voting.

Tyson D’Sylva
Ace Body Corporate Management
T: 08 8342 1544
E: tyson.d@acebodycorp.com.au

This post appears in Strata News #349.

Question: When voting on change of strata management at the AGM, how can the strata manager vote with their proxies to keep his contract? Surely this is a conflict.

I am on the committee at a community strata estate consisting of 151 lots. We are about to hold our AGM and on the agenda is changing strata management.

Some lot owners have given their proxy to the strata manager. Can the strata manager vote with the power of the proxies to keep his contract? In my mind, he should not be able to vote due to self-interest and financial benefit. How do strata voting rules work in this situation?

Answer: It is standard practice for managers to abstain from voting unless otherwise advised by the members they are acting on the behalf of.

While the Community Titles Ace does not have a provision for body corporate managers acting as a proxy for owners and reappointing themselves, it is standard practice for managers to abstain from voting unless otherwise advised by the members they are acting on the behalf of (because of the reasons you have listed).

It may be advisable to check the proxy forms and see if a resolution is listed for reappointment of the manager. If it is, the manager should be voting in the way indicated on the proxy form. It is also recommended that if members are seeking a change in management, they should be consulting with the rest of the corporation’s management committee to ensure a cohesive agreement is reached.

Alice Rogers-Ross
Ace Body Corporate Management
T: 08 8342 1544
E: alice@acebod.com

Question: I am a member of a strata title and don’t understand the strata voting rules relating to “voting on resolutions by email”.

I am a member of a strata title and don’t understand the strata voting rules relating to “voting on resolutions by email”.

We have recently been asked to vote on a resolution via email communication each way and I believe the outcome to be flawed. Whilst only 1 vote against the motion was recorded, I have been told by other members that at least 2 NO votes were cast and another members “no vote by email” was not received. Please help me understand the “email” communication rules and point me to the parts of the act that clarify them.

We are a community of only 8 households and I believe we have been hoodwinked into accepting an unpopular motion via the Executive Committee consisting of only 1 person acting as chairman, vice-chairman and secretary.

I am in the dark concerning the strata voting rules and procedure to be followed by the Strata Management Company concerning the procedure to be followed by them when moving a motion developed by the Executive Committee of One and then calling for a vote on the motion by all the unitholders via Email.

In this case, there was no opportunity provided for the members to discuss the matter. One member’s “no vote” was misinterpreted as a yes or abstention vote and another members “no vote” was not recorded because of an electronic problem with their email response.

Can motions and votes be conducted via email only? What is the procedure, in terms of the Act that must be followed by the Executive Committee, the Strata Title Management Company and the unit members?

Does the same rule apply for both Strata Title and Community Title?

Answer: Any motions should be voted on at a general meeting of the corporation or through a management committee which has been delegate appropriate powers to make decisions on behalf of the owners.

It appears that the owners are being asked to make a decision via email and I assume it is a community corporation and under the Community Titles Act. Any motions should be voted on at a general meeting of the corporation or through a management committee which has been delegate appropriate powers to make decisions on behalf of the owners.

If the corporation has not formed a management committee nor constituted a general meeting as per section 81 of the Community Title Act and given the required 14 days written notice to each owner stating time, date, venue and motions, then no votes should be counted as the decisions were not made in accordance with the legislation.

Depending on the motions a special general meeting should be called with proper motions and all owners informed so they can attend and discuss and a vote be counted. If owners cannot attend in person, a proxy form with their instructions/ decision can be posted or emailed to the secretary, so it can be tabled at the general meeting of the corporation.

The same rules will apply for both Strata Title and Community Title regarding the time frame and the need to have a meeting to approve motions.

Please refer to Strata Titles Act 1988 – Division 5 Section 33.

Tyson D’Sylva
Ace Body Corporate Management
T: 08 8342 1544
E: tyson.d@acebodycorp.com.au

Question: What are the regulations or guidelines with regards to how a Strata Manager should use his proxy votes at AGMs when he holds a lot owner’s proxy?

I am wondering if you could please help me with a question regarding voting at an AGM. Could you let me know what regulations or guidelines there are with regards to how a Strata Manager should use his vote when he holds a lot owner’s proxy?

For example, if the Strata Manager can use three votes held as a proxy to vote against the majority with relation to the appointment a representative of Unit to the committee. Prior to their three proxy votes, the vote status stood as 11 against and 9 for.

Answer: When a strata manager holds the proxy for an owner at an AGM or at any General Meeting, the manager should cast their proxy votes as per the instructions provided by the owner.

When a strata manager holds the proxy for an owner at an AGM or at any General Meeting, the manager should cast their proxy votes as per the instructions provided by the owner.

If no instructions have been provided, this makes it difficult for the manager to vote as there could be a conflict of interest here and I would have to say the best practice guideline would be to abstain.

Technically, a proxy has the right to vote as if they were the owner. It may pay to do some groundwork before the meeting so proxies can be directed to more appropriate persons or make sure your proxy has a more detailed way of voting so better instructions can be received.

Tyson D’Sylva
Ace Body Corporate Management
T: 08 8342 1544
E: tyson.d@acebodycorp.com.au

Have a question about strata voting rules for proxy voting or something to add to the article? Leave a comment below.

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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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