Legal

October 29, 2021 Published by North Alberta Chapter - By ERIN BERNEY

Legal Corner – Annual General Meetings: The Importance of Proper Notice

From the North Alberta Chapter: Vol. 27, Issue 1 - Fall 2021 of Insite to Condos

Has your condominium corporation convened an Annual General Meeting (AGM) since the COVID-19 pandemic began in March 2020? If you’re not a member of your Board of Directors and you answered ‘no’ to that question, you may want to find out for sure after reading this.

The condominium I’ve owned and in which I’ve resided for over 16 years convened an AGM in November 2020. It’s a small condominium property with fewer than 40 units, and a physical meeting was possible at the time without violating public health restrictions. In fact, aside from myself, members of the Board of Directors and representatives of the property management company, there were only four (4) owners present at the meeting in person.

I almost missed it, however, as I did not receive any notice that the AGM had been convened. The Condominium Property Act requires condo corporations in Alberta to provide at least fourteen (14) days written notice of an AGM (or any other general meeting of the corporation) to all unit owners and to those mortgagees who have given notice of their interest to the corporation. Instead, I received a text message from one of my neighbours (who is also a Board member) the night before the meeting was scheduled to take place, asking if I was planning to attend. Since the beginning of 2020, the Board of my condominium had apparently been sending notices to unit owners by email and/or using Facebook for all its communications.

The Board, on the advice of the property manager, relied on amendments to the Condominium Property Act and regulations which came into force on January 1, 2020. The relevant portion of the section reads as follows:

71.1(1) A document, including any written notice or request, may be served by a corporation on an owner […]

(c) by electronic means to an electronic address that the owner has specifically provided as an address to which information may be provided by those electronic means.

This contemplates unit owners providing electronic addresses “specifically” for the purpose of receiving notices and information. In other words, condo corporations are not authorized to send electronic notices to unit owners in place of personal service or regular mail until this precondition is satisfied. The provision is consent-based and requires unit owners to effectively “opt in”, in order to validly receive electronic notices from the corporation.

2014. Like most people, I have several email addresses: one address is primarily used for business communications, another is for personal communications, and at least one more that I rarely, if ever check, is now just a repository for spam and junk mail. Most of us have at least one of these old junk email addresses, and this is the one I had provided to the manager six years ago.

The consent I gave in 2014 was for the purpose of receiving email communications from the property manager in my capacity as a Board member, at that time. Ostensibly, I was asked to provide this consent to the manager in order for it to comply with Canada’s new Anti-Spam Legislation (CASL), which came into force July 1, 2014. Like section 71.1 of the Condominium Property Act, CASL is also opt-in legislation, under which businesses and certain other organizations are not permitted to send commercial, electronic messages to individuals without obtaining their prior consent.

In 2014, there was no legislative authority for condominiums to send electronic notices to unit owners, for notice of AGMs or for any other purpose. Therefore, even if consent was provided for the particular purpose of receiving notices as a unit owner (and not some other purpose) in 2014, it may be unreasonable for a condo corporation to rely on such consent in 2021.

During my corporation’s AGM, I learned that there were at least a few other unit owners in a similar position as myself. I was later informed that the Board will be investigating to determine how many other owners were affected by its decision to send notice of the AGM by email, and this will inform its next steps insofar as whether any business conducted at the AGM may need to be validated at a subsequent meeting.

Ordinarily, a failure to give proper notice of a general meeting does not invalidate anything done at that meeting. This is another amendment to the Condominium Property Act that came into force in 2018. But in order for a corporation to avail itself of this provision, it must demonstrate that it made a reasonable attempt to give proper notice.

In my view, where the original attempt to provide notice did not itself comply with the legislation, it cannot be called reasonable and may not be saved by this section of the Act. And even though property management may have advised the corporation that email notice without prior consent by unit owners was sufficient, shifting the blame to the manager does not validate improper notice. All this highlights the importance of ensuring that condo corporations comply with their statutory obligations, especially when it comes to satisfying formal notice requirements for AGMs and other meetings.

Much of condominium law in Alberta, and arguably in most jurisdictions, is consumer protection-based legislation. It is designed to protect unit owners and prospective purchasers from loss and abuse. The Condominium Property Act has very specific requirements designed to ensure that all unit owners receive full, timely notice of AGMs and other general meetings at which important decisions are raised, discussed and voted upon.

Providing proper and adequate notice of an AGM is therefore critical to protect the interests of unit owners. In many cases, condominium units are probably the owners’ most valuable assets. Regardless of their individual importance, though, all unit owners have a fundamental right to attend meetings and to weigh in on the business and affairs of the corporation. Notice requirements exist specifically to protect this right.

Now that condominium corporations can also convene their AGMs and other meetings virtually, by electronic means (another recent amendment to the Act, provided there are no express provisions in the corporation’s bylaws restricting or prohibiting virtual meetings), it is even more important that proper and adequate notice of such meetings is provided to all unit owners. This will ensure that everyone with a right to attend the meeting has sufficient opportunity to contact the corporation and arrange for personal attendance if they do not have the means to attend virtually. The right to attend meetings of the corporation carries with it the right to meaningfully participate at such meetings, and many condo owners may still lack the technological capability to participate in discussion and voting via electronic means, resulting in a continuing obligation of corporations to provide accommodation for different forms of meeting attendance.

Given my experience, I urge unit owners who have not received notice of an AGM since the pandemic began in March 2020 to reach out to their elected Boards and/or property managers and confirm whether an AGM has already taken place without proper notice having been given. For those condominiums that are already making use of electronic meeting notices by way of email, Facebook, Geniepad or some other format, ensure that unit owners have opted in for these modes of communication.

A good practice is to confirm that unit owners have provided both their consent and a specific electronic address for this purpose. Just because an owner is a member of the corporation’s group on Facebook does not mean they have consented to all notices being received electronically, particularly notice for AGMs. Many owners still prefer to receive such notices delivered in hard copy to their address for service. This includes copies of all other documentation corporations are required to provide in advance of an AGM, including (but not limited to) the following:

• annual financial statements for the preceding year,

• the annual reserve fund report,

• the budget for the upcoming year, and

• draft minutes from the last AGM

Now that corporations have the appropriate legislative authority, there is nothing wrong with providing notices of AGMs to owners by email, provided they have elected to receive their notices in this manner, and are therefore expecting it. Otherwise, the corporation could find itself having to validate all votes and actions taken since the AGM occurred. If in doubt about whether or not an electronic notice is permitted and the form of notice is acceptable, obtain legal advice.

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BY: ERIN BERNEY, FIELD LAW