I often get asked whether a chairperson is able to exercise his casting vote at the body corporate’s Annual General Meeting. This question indicates to me that:
1) the scheme needs more information on the casting vote a chairperson is able to exercise in certain circumstances
2) the scheme is probably not counting votes cast at an AGM in the correct manner
Let’s take a closer look at why I would make these statements.
The prescribed management rules provide that the chairperson has a casting vote, in the event that the trustees reach a deadlock when casting their votes for or against a trustee resolution. When the trustees cast their votes in their capacity as such, each trustee is entitled to one vote. Every trustee’s vote therefore carries the same vote value. The only exception being that, if the votes cast (including that of the chairperson) are tied, the chairperson has a casting vote. Practically, this means that the chairperson’s vote will carry double the value of the other trustees’ votes if the votes cast are tied.
The chairperson does not have this ability to cast a casting vote at general meetings, but it is important to understand that it would never be necessary for him/her to do so, as the votes cast at a general meeting cannot be deadlocked. This is because there are values (in the form of participation quotas) attached to every member’s vote cast at a general meeting. This differs substantially from the “one trustee – one vote” system used when voting for or against trustee resolutions. It is therefore of vital importance that every managing agent and trustee peruse the scheme’s PQ sheet, included in the body corporate’s sectional plan, to ascertain each member’s participation quota and therefore vote value.
If more than 50% in value (based on participation quota) of the members at the Annual General Meeting vote in favour of the below resolutions, then these resolutions will pass:
- Elect a person to chair the meeting
- Approve the agenda
- Approve the minutes of the previous general meeting
- Approve the insurance replacement schedules
- Determine the extent of the body corporate’s insurance
- Approve the body corporate’s budgets
- Appoint a particular auditor
- Determine the number of trustees to be elected
- Elect the trustees and give directions or impose restrictions on the trustees
If 50% or less (in value) of those present at the meeting vote in favour of these resolutions, they will not pass, regardless of the chairperson’s vote for or against the resolution.
If you are unsure about when the chairperson is entitled to exercise their casting vote, would like to obtain clarity regarding the counting of votes at an AGM, or generally feel you would like to broaden your knowledge on sectional titles schemes management, why not consider doing the Paddocks UCT Scheme Manager – Sectional Title short course? For more information, email email@example.com.
Article reference: Paddocks Press: Volume 15, Issue 7.
Specialist Community Scheme Attorney (BA (Law) LLB), Ané de Klerk, combines her work experience as a Portfolio Manager with knowledge of conveyancing and community scheme law.
This article is published under the Creative Commons Attribution license.