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AGM via postal ballot, is this possible?

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

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QA Small 4 Unit Strata Scheme AGM

Question: For a small 4 unit strata scheme, are we legislated to hold AGMs or carry out any other activities in terms of the owners corporation?

We’ve bought a unit in a 4 unit strata complex in Northern Melbourne. The only common property is the driveway and the only expense is the strata insurance policy covering all 4 units.

Are we legislated to hold AGMs or carry out any other activities in terms of the owners corporation?

Answer: We recommend that your Owners Corporation at least hold an annual general meeting resolving to raise a budget to cover the common driveway and strata insurance expenses.

The Owners Corporations Act 2006 (Act) requires that the Owners Corporation pass resolutions when it takes actions. Passing resolutions and recording them through meeting minutes or ballot results record the decision of your Owners Corporation when it raises funds for expenses each year.

Further, an Owners Corporation is only capable of making legal decisions and validate its actions when it passes resolutions.

Therefore, at a minimum we recommend that your Owners Corporation at least hold an annual general meeting resolving to raise a budget to cover the common driveway and strata insurance expenses.


Rochelle Castro
RC & Co Lawyers

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Minutes in AGM reports


16 Nov 2022

Question: Should the minutes of the AGM include the Manager’s Report and the Committee Report?


Should the minutes of the AGM include the Manager’s Report and the Committee Report even if they have been recently circulated to all owners? It’s not clear from my reading of the Act, but I think it may be important to have these included.
 

Answer: The AGM minutes should consist of the decisions made by the OC.

The AGM minutes should consist of the decisions made by the OC. That is the minimum legal requirement.
The OC could decided at the AGM to require that the chairperson and committee reports (Reports) are attached to the minutes. From our understanding, most owners corporations’ practice is to attach the Reports to the AGM notice which gives notice and information to the owners corporation members prior to attending the AGM.

Rochelle Castro
RC & Co Lawyers