How do you make strata meetings compliant with industry legislation? What should a successful strata manager consider when preparing for and holding strata meetings?
Real estate practitioner and strata manager, Christine Nesbit, and specialist strata lawyer, Amanda Farmer, answered these important questions and more about general meeting preparation and rules in a recent REINSW Webinar.
“Your strata meeting is important. It’s where you make decisions. It’s where you come together as a strata scheme,” Nesbit says.
“Why not make it as great as you can and give everybody the opportunity to be there and be involved in their strata scheme? It makes for a more harmonious scheme and it gives everyone the right to be heard.”
Timing of meetings
The first time a strata scheme is developed, during the initial period an Annual General Meeting (AGM) must be held; this must take place within the first two months to avoid a potential fine of around $1100. The AGM must be held every 12 months and notice of the AGM must be given at least 14 days prior to the meeting.
“It’s really important to remember when you are having a first AGM that there are different rules,” explains Farmer. “The initial period is when the developer still owns more than two-thirds of the lots. We calculate that based on the unit entitlement of each lot.”
The rules for holding AGMs have also changed as detailed in the Strata Schemes Management Act 2015.
“The requirement now is that you must hold an Annual General Meeting at least once in each financial year of the building. This means we’re not as restricted (as before),” Farmer says.
For a regular general meeting seven clear working days’ notice must be provided (not including the date the notice was sent or the date of the meeting).
“You really should be putting the agenda in the post three weeks before and making sure there can be no question that you haven’t served it on time,” says Farmer.
Anyone interested in reading more information about these provisions should refer to Schedule 1 of the Strata Schemes Management Act 2015.
Setting the meeting agenda
“Your meeting will run very successfully if you set a good agenda. Set the agenda to the items required and follow that agenda,” Nesbit advises.
“There are mandatory items that need to be included on the agenda of an AGM – they’re things like renewing your insurances, appointing an auditor, adopting a budget, and of course we’re always approving the minutes of the last general meeting,” adds Farmer.
Important information for owners corporation
What information needs to be included and sent to the owners corporation in preparation for a meeting? It all depends on why the general meeting is being held. Nesbit and Farmer outline a variety of reasons including dispute resolution, raising funds or capital works to be done, etc. Whatever the situation, it’s important to ensure a meeting is held to make efficient progress.
“Get everybody around the table, discuss it, and finish it,” Nesbit says. “That way you’re not going backwards and forwards with emails and different opinions and situations.”
Attendance and proxy voting
The panel then discussed the importance of knowing who is attending the meeting and the rules around proxy voting.
“You should have a signature sheet from everyone attending,” Nesbit says. “You need to know who’s at your meeting at all times.”
It’s essential to understand how a quorum is determined at a meeting.
“The quorum for general meetings is one quarter of the persons who are entitled to vote, and you can calculate that on a lot basis or on a unit entitlement basis,” adds Farmer. “And just bear in mind it’s persons present either in person or by proxy.”
According to both Nesbit and Farmer, the rules around proxy voting can be complicated and one must be aware of the latest regulations.
“Changes to legislation in our 2015 Act were designed to prevent this practice of what we call ‘proxy harvesting’,” says Farmer. “Now we have a limit on proxies. So the rule is, if you are in a scheme with 20 lots or less, one person can hold one proxy. If you are in a scheme with more than 20 lots, one person can hold the equivalent of five per cent of the number of lots in the building.”
To learn more about strata meeting preparation and compliance, watch the Webinar: Strata meetings – How to make them successful
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