Legal

November 5, 2024 Published by Manitoba Chapter - By Alan Fobes

Condo Conversation Corner - November 2024

From the CCI Manitoba Fall 2024 Condominium News and Views Magazine

In this edition, we have five topics of interest:

• Condo director elections and acclamations
• Condo corporation board behaviour
• Registry of condo corporations
• A reminder about  electronic meetings 
• Proxies

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If you want to contribute to the discussion, you can submit a comment on our website or send us an email.

Disclaimer

CCI Manitoba is unable to provide specific legal advice. We recommend that you speak to a lawyer regarding the challenges or problems you may be experiencing. For your information, a list of lawyers who are Professional Members of the Manitoba Chapter of the Canadian Condominium Institute is available on our website.

Note that frequent references are made to Manitoba’s Condominium Act and regulations.

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Condo director elections and acclamations

The question of acclamations in condo corporation elections comes up frequently, as it did at our recent CCI Manitoba AGM. This time the question referred to cases in which the number of candidates for a board is equal to or fewer  than the number of director positions that are open.

First of all, acclamation is defined by Meriam-Webster as “an overwhelming affirmative vote by cheers, shouts, or applause rather than by ballot.” Note that action is required by those in attendance and without their input acclamation is not automatic.

So the question is: If there are an equal number of candidates or fewer for the open board positions, are all candidates automatically acclaimed? 

Acclamation is neither referred to in our provincial condominium act nor in the associated regulation. However, the act does indicate that unit owners must elect directors.

Board elected by unit owners
95 Unit owners must elect the directors of the board in accordance with this Act and the condominium corporation's by-laws.
Election of directors at annual general meeting
111(1) At each annual general meeting, the directors must be elected by the unit owners entitled to vote who are present in person or by proxy at the meeting.

Note also that while the act does not prescribe any election method, such as use of ballots or show of hands, the corporation’s bylaws probably have some voting requirements for the election of directors. 

Robert’s Rules of Order in clause 46:40 speaks to the acclamation issue, but only in the context  of when there is a single nominee and the bylaws do not require a ballot vote. 

46:40 If only one person is nominated and the bylaws do not require that a ballot vote be taken, the chair, after ensuring that, in fact, no members present wish to make further nominations, simply declares that the nominee is elected, thus effecting the election by unanimous consent or “acclamation.” The motion to close nominations cannot be used as a means of moving the election of the candidate in such a case.

46:41 The assembly cannot make valid a viva-voce election if the bylaws require the election to be by ballot.

Acclamation is also mentioned in some online resources, such as Civility’s Quick Guide: Election by Acclamation, a 2019 article written by Sarah E. Merkle https://civility.co/uncategorized/a-quick-guide-to-election-by-acclamation/. The key points of this article include:

• acclamation means enthusiastic approval 
• election by acclamation is allowed when only one person is nominated
• election by acclamation is not allowed when bylaws require a ballot vote
• election by acclamation means no one gets to vote no

Note that most sources discussing the acclamation issue also include comments that the corporation’s bylaws may have more to say on the matter. 

Guidance

We have provided lots of information above but nothing really definitive. The corporation’s bylaws matter a lot. Since acclamation implies enthusiastic approval, don’t use it if one or more candidates would not be easily elected if they were running against a challenger. Perhaps take the approach of making all owners feel that they have a voice in the governance of the corporation and allow them to vote for or against their directors. Lastly, since the act requires a vote by the owners, let them vote, and perhaps require a simple majority for each director to be elected or at least to vote on a motion to acclaim. 

Many  corporations' bylaws  specify a minimum and maximum number of directors. If there are insufficient candidates to fill the open director positions, consider passing a motion to set the board size for the year. For example, for a board with a minimum of three and maximum of five directors, if, after the election there are only three directors on the board, raise a motion to set the board size for the year to three. That means the quorum to conduct business would be two. Otherwise, the quorum would be three and the board might not be able to conduct business if one director is away.

Condo corporation board behaviour

We often get inquiries from unit owners complaining about their corporation’s board of directors in general or a specific director in particular. While we hear only the complainant’s side of the situation, the stories sound believable and troubling.

Examples of bad director and board behaviour include:

• cliques on boards ghosting newly elected directors and excluding them from meeting invitations and email threads;
• directors belittling unit owners who dare to ask a difficult question at a general meeting of the owners (or other directors asking questions at a board meeting);
• boards consciously deciding to be willfully ignorant of the condo act and good governance, stating “We don’t need to educate ourselves because our property manager is a member of CCI”;
• directors being physically intimidating and/or verbally abusive to other directors and unit owners;
• directors consciously disregarding requirements in the condo act “because it is only a guideline.”

Since there are no “condo police” to call, we can only suggest taking action to replace problem directors and boards. We encourage all corporations to adopt a code of ethics, not only for directors but also for unit owners. 

Similarly, we are frequently asked whether condominium corporation directors are required to adhere to a code of ethics.

There is nothing in the provincial condo act requiring condo directors to adhere to a specific code of ethics, but the act does outline the duty of the board and its directors in section 94

Duty of board
94(1) A board is responsible for performing the duties and exercising the powers of the condominium corporation in accordance with the corporation's mandate, duties and powers under this Act and the corporation's declaration and by-laws. 

Duty of directors and officers
94(2) In performing the duties of the condominium corporation and exercising its powers, each director and officer of the board must
(a) act honestly and in good faith with a view to the best interests of the corporation; and
(b) exercise the care, diligence and skill that a reasonable and prudent person should exercise in comparable circumstances.

CCI Manitoba recommends each condo corporation adopt the CCI code of ethics, both for directors and for unit owners. These forms are available in the members-only area of our website. While we, at CCI Manitoba, don’t know how many corporations have adopted these forms, this author has incorporated them into a policy for his own corporation.    

Yes, the condo act allows for electronic meetings

Recall that as a result of the pandemic, the provincial government amended the condo act to allow electronic meetings (fully electronic or hybrid) for both condo boards of directors and for general meetings of the owners.

A member contacted us suggesting that we remind all of our members about this option. As we prepared to do so, we noticed that the pertinent provincial website, The Condominium Act & Information, still has a link to the unamended version of the act. (We have contacted them to get the website updated.) Here is a link to the fully amended condo act. Note that there is a legislative history button that will show all amendments.

If you plan to use the electronic meeting format for your annual general meeting, here are a couple of options for your consideration to handle the remote participants and voting:

• GetQuorum - https://www.getquorum.com
• CondoVoter - https://www.condovoter.com

Proxies

We receive numerous questions about proxies, especially in the period leading up to a general meeting of the owners of a condo corporation. Some unit owners are concerned that unscrupulous directors may be stacking the deck for elections at meetings of the owners. It is possible that this does happen but it is also probable the unit owners don’t understand proxies.

Robert’s Rules of Order clause 45:70 provides a definition of a proxy, and also mentions when it can and can’t be used.

“A proxy is a power of attorney given by one person to another to vote in his stead; the term also designates the person who holds the power of attorney.” 

The use of proxies is specifically allowed in the condominium act. Their use will also depend to some extent on specific condominium corporations bylaws. Section 128 of the condominium act describes the requirements and effects of proxies and places limits on who may be a proxy. It also indicates a proxy can be revoked at any time.

All condominium corporations should consider making good use of proxies for all general meetings of the owners, as such use helps ensure a quorum for the meeting. It is important to remind unit owners that even if they appoint a proxy in advance of the meeting, they can still show up to the meeting, revoke the proxy and vote in the meeting.

In cases of poor governance practices at a condo corporation, the use of proxies by a group of concerned unit owners can effect change in the membership of their board of directors, either by getting a motion passed to remove a director or by voting for new directors. The concerned group would be well served to go door to door in their corporation, asking owners to sign a proxy form, to ensure sufficient votes are available to achieve their goals. In so doing though, they should at all times act respectfully and ethically, and not attempt to force owners to sign against their will.

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Alan Forbes owns and lives in a condo and is a director of his condo corporation. He also is a director of CCI Manitoba and is its vice-president.