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Housing Counsel: Quorum Requirements Must Be Strictly Enforced - 2006-05-15

Question: I am the secretary of our 138 unit condominium association. Our annual meeting is scheduled for next month, and if past history applies we will not be able to obtain a quorum at that meeting. Our quorum requirement is that 50 percent of the unit owners must be present at the beginning of each meeting. Exactly what is a quorum? Why is it necessary? And how can we reduce this 50 percent requirement?

Answer: The Merriam-Webster Online Dictionary defines a quorum as "the number (as a majority) of officers or members of a body that when duly assembled is legally competent to transact business."

Your quorum requirement should be spelled out in your legal documents -- usually in the Bylaws of your Association. Typically, quorum requirements range from 25 percent up to 50 percent. In other words, in order to properly conduct a meeting -- and take actions which are valid -- the requisite number of owners must be present, in person or by proxy, at the beginning of the meeting.

Why have a quorum requirement at all? According to Robert's Rules of Order -- the guru of Parliamentary law -- the "requirement of a quorum is protection against totally unrepresentative action in the name of the body by an unduly small number of persons."

You have 138 members in your association. Every member is legally required to honor and obey the legal requirements spelled out in your legal documents -- whether or not they have read them. In order to change the legal documents, your Bylaws require that at least 70 members attend the meeting. While that is certainly a large requirement -- and as you suggest often difficult to achieve -- do you want your legal documents to be changed by a small rump group of dissident owners?

Let's say that your association documents do not permit pets, but 10 members would like to change the rules so that pets are permitted. Should they be able to call a meeting, and vote to change the rules? Obviously not.

Indeed, in most association documents, you will find even higher quorum requirements for such items as amending the legal documents, or terminating the association itself.

You asked if the quorum requirements can be reduced. Yes, but you will need a quorum (and possibly a super-majority quorum) to accomplish this. From my experience, it is difficult, if not impossible, to amend the legal documents in a community association.

Most associations permit voting (and counting of the quorum) to be by an owner "in person or by proxy." According to Robert's Rules:

It is a fundamental principle of parliamentary law that the right to vote is limited to the members of an organization who are actually present at the time the vote is taken in a legal meeting. Exceptions to this rule must be expressly stated in the bylaws. (Robert's Rules of Order, Newly Revised, 1990 Ed., 9th Ed).

The two most common exceptions are voting by mail and proxy voting.

You have to read your Bylaws carefully to determine if proxy voting is permitted, and if so, whether there are any restrictions on who can hold a proxy. Many community associations place limits on the number of proxies that any one owner can hold. Other associations allow their management company to hold an unlimited number of proxies, but those proxies can only be counted for quorum purposes; in other words, management cannot vote on substantive issues affecting the association.

If you do not have a quorum present at the beginning of the meeting, any vote or any action taken by the membership (even if unanimous) is considered legally null and void. The group can, however, fix a time for the next meeting, or agree to adjourn the meeting for a period of time.

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912 - Canadians who decide to sell their house and adopt a high-rise lifestyle, may think the toughest decision has been made. However, one other critical choice lies ahead. A decision regarding the type of tenure that will suit their needs will be necessary before they move: "Should we rent an apartment, purchase a condominium unit, buy into a cooperative or select a life lease unit?" Stand on the sidewalk and look at a residential high-rise building and you may not be able to tell whether the building is rental, condominium, cooperative or life lease. Individual units under these tenure variations may offer similar comforts and building facilities may be equally basic or luxurious, but your rights as a resident are dramatically different. As a tenant in a rental suite, your rights are dictated by the provincial residential tenancy Act, such as Ontario's Tenant Protection Act, and the contract or lease you have with the owner of the building. Purchase a condominium unit and you have ownership rights similar to those of a house owner, but with limitations related to the coexistence of multiple owners. Read this Nemmar Real Estate Training article at Real Estate - International

 

It should be noted that there is a lot of confusion over the meaning of the word "adjourn." Some people think it means to terminate the meeting. That is technically not correct. According to the on-line dictionary, adjourn means "to suspend a session indefinitely or to another time or place."

One suggestion: you can "adjourn the meeting," rescheduled it for two or three weeks later, and then literally "beat the bushes" to get proxies from all owners.

You should also have your association attorney review the Corporation Laws in your State. Some states have addressed this issue, by allowing a meeting to proceed without a quorum if sufficient notice has been given to all owners. Generally, this may require that you place a notice in a local newspaper of general circulation, and have it run for the number of times required by the statute.

In the absence of a legal quorum requirement spelled out in your Bylaws, the general rule is that a majority of the membership must be present (in person or by proxy) in order to properly conduct business.

This is a highly technical and perhaps archaic requirement. But if the legally required quorum is not present, your association cannot hold its meeting.

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