December 15, 2016
Meeting up – Role of the Chair
Rules for owner meetings and the role of the Chair
In the first in this series, we looked at the role of the trustees in a complex under sectional title law. In this article we will cover general meetings of owners and the role of the Chair.
Annual General Meeting
To comply with legislation, the body corporate must call an annual general meeting (AGM) within four months of the end of the financial year. However, members can waive their right to a meeting and agree instead to deal with motions in writing. However, this waiver must be unanimous. If the members do not all consent, then the AGM must go ahead. The waiver must be implemented within one month of the financial year-end.
Special General Meetings
Every meeting other than the AGM is classed as a special general meeting. Trustees may call a special general meeting at any time and are obliged to call one if requested to do so by 25% of members. If the trustees fail to convene a meeting within 14 days of such a request, the members are entitled to call the meeting. The reasons why members might call a meeting are as varied as the matters that arise in daily life in a complex, but the issue to be discussed must be included in the meeting request and in the accompanying agenda.
What’s on the agenda?
Annual and special general meetings require an agenda, set by the trustees, which must contain:
- A description of the general nature of the business at hand
- Matters to be put to a vote, including specific wording of any resolutions
The running order of the meeting, much of which is concerned with good governance and administration, is stipulated in law:
- Confirm member representatives and issue voting cards
- Establish quorum status
- Elect a chair
- Present evidence of meeting notice or waiver of the right to notice
- Approve the agenda
- Approve the minutes from the previous meeting
- Close off unfinished business from a previous meeting
- Deal with the issue that led to the meeting request
- If it is the first general meeting, address all the points concerning the developer’s duties, etc. as laid out in Rule 16 of the Act
- Report on any amendments to Scheme rules
- Deal with any other business
- Cover any restrictions or directions regarding new or existing trustees
- Dissolve the meeting
The running order of the AGM is as follows:
- Reports on trustees’ activities and decisions since the previous meeting, including committees
- Approval of insurance replacement values
- Determine and agree insurance cover
- Approve budgets and reserve funds
- Present the annual financial statements
- Appoint the auditor
- Determine the number of trustees
- Elect trustees
Who’s in the chair?
Normally, the chair of the trustees acts as the chair of the annual or special general meeting. If this individual is unavailable or otherwise unable to chair the meeting, the members present can elect a chair for the duration of the meeting.
It is the chair’s job to maintain order; ensure all members have a chance to air their views; keep motions proposed within the scope of the meeting; settle disputes and make decisions; and ensure that all relevant documentation is available at the meeting. The chair may not attempt to influence any member from the chair or reveal the chair’s voting intention in advance.
General meetings must be quorate, which means, for a body corporate with less than four members, at least two thirds of voting members; and for larger schemes, at least one third of voting members.
Motions tabled at general meetings do not require to be seconded, and are passed by a simple majority of members’ votes by value. Members in arrears with levy payments or in breach of any of the scheme’s conduct rules are not eligible to vote. Proxy voting is allowed, subject to terms and conditions.
Sectional title law is complex and the regulations are more detailed than what we have outlined here. We have attempted to give you a comprehensive but accessible overview of meeting rules. If you have specific questions about the Act or about your scheme, give Simon a call on 087 550 2740 or 076 116 0623 or email email@example.com. SD Law & Associates are experts in property management and sectional title law and will resolve your query promptly and efficiently.
To view the full set of regulations visit www.nama.org.za