Q. A Committee has advised that it would like to conduct their AGM via postal ballot, is this possible?
A. Section 69(2) of the OC Act provides that an AGM must be held at least once every 15 months.
Section 80(1) of the OC Act provides that an owner may participate in an AGM “… in person, by teleconferencing in accordance with the regulations, by proxy or in another manner provided for by the regulations.” Relevantly, it does not provide that participation may be by ballot.
On the other hand, section 80(2) of the OC Act does provide that the procedure at a general meeting is in the discretion of the OC. This may be interpreted to mean that a ballot would be acceptable. However, it is our view that this interpretation would be incorrect and not supported by VCAT. Rather, “procedure” is a reference to what takes place at the meeting itself, not as to whether it needs to be an actual meeting.
The OC Act clearly distinguishes between ballots and general meetings, including who may call them and how they are to be run. Given the clear distinction and the fact that participation at an AGM cannot be by Ballot pursuant to section 80(1) of the OC Act, it is our strong view that an AGM by ballot would not constitute a valid AGM.
VCAT has adopted the view that AGMs are inherently important, not just so that resolutions can be passed, but also so owners are afforded an opportunity to discuss matters of importance. A ballot does not allow this.
Mark Lipshutz
