It is a common source of frustration for managing agents and trustees: an owner falls heavily into levy arrears, the body corporate incurs legal costs obtaining a court judgment or CSOS order against them, yet they show up at the Annual General Meeting (AGM), sometimes carrying proxies for other owners, to challenge the budget and vote on scheme business.
A fundamental compliance question arises in these situations: If an owner is disqualified from voting under Prescribed Management Rule (PMR) 20(2) due to an outstanding judgment or CSOS order, can they still act as a proxy for another member?
The short answer is no, not for ordinary resolutions. While they may attend the meeting and cast votes on special or unanimous resolutions, they cannot exercise a proxy vote on ordinary resolutions.
Here is the legal analysis.
1. The Scope of Disqualification Under PMR 20(2)
Voting disqualification in sectional title schemes is regulated by PMR 20(2), which provides:
“Except for special and unanimous resolutions, a member is not entitled to vote if—
(a) a member fails or refuses to pay the body corporate any amount due by that member after a court or adjudicator has given a judgment or order for payment of that amount; or
(b) that member persists in the breach of any of the conduct rules of the scheme referred to in section 10(2)(b) of the Act after a court or an adjudicator has ordered that member to refrain from breaching such rule.”
Two critical legal limitations are embedded in this rule:
A. It Applies Only to Ordinary Resolutions
The opening phrase – “Except for special and unanimous resolutions” – carves out an explicit exception. A member subject to a court judgment or CSOS order is never disqualified from voting on special or unanimous resolutions. Because these high-tier resolutions directly impact proprietary rights and foundational scheme rules, the legislature preserves every owner’s right to vote on them, regardless of arrear status.
B. The Restriction Focuses on the Act of Voting
The rule explicitly states that a member “is not entitled to vote.” A proxy is merely the mechanism by which voting rights are exercised on behalf of another. Because the statutory prohibition strips the disqualified individual of the legal capacity to cast an ordinary vote at the meeting, that restriction extends to any vote they attempt to cast, whether for their own section or as a proxy holder representing another owner. Consequently, they cannot cast a proxy vote on ordinary resolutions.
2. Attendance vs. Voting Rights
There is a common misconception that an owner with a judgment against them is barred from entering the meeting room altogether.
PMR 20(2) revokes the right to vote on ordinary resolutions; it does not revoke the right to attend.
Under the Sectional Titles Schemes Management Act 8 of 2011 (STSMA), all registered owners remain members of the body corporate. An owner subject to a judgment or CSOS order retains the right to:
- Receive notice of general meetings;
- Attend general meetings in person;
- Participate in discussions; and
- Vote for special and unanimous resolutions.
They simply cannot have their vote counted, or deliver a proxy vote, when an ordinary resolution is put to the floor.
Conclusion
The law strikes a deliberate balance: it penalises defaulting owners by freezing their ability to influence day-to-day administrative decisions (ordinary resolutions) – whether directly or via proxy – while preserving their fundamental rights to attend meetings and vote on major governance changes.
_________________________________
Article reference: Paddocks Press: August 2026, Volume 21, Issue 7
This article is published under the Creative Commons Attribution license.
