Governance

January 8, 2025 Published by London and Area Chapter

AGMs: Proxies, Financial Statements and Code of Ethics

From the CCI Review 2024/2025-1 July—November 2024 issue of the CCI London Chapter

Very soon and depending on a corporation’s year-end date, boards / managers will be arranging completion of 2024 Financial Statements with their Auditor, to be included in the AGM package to owners.

It is critical for boards / managers to ensure prompt responses upon request from the auditor to ensure completion of the audit to meet planning dates for their Annual General Meetings to report to Owners.

Proxies

There has been a history of confusion and questions relating to proxies. Too often, owners are perplexed enough that they may not fulfill their legitimate option to complete the proxy at all, making it difficult to reach quorum to carry out the business of the meeting for the corporation. This could result in calling additional meetings and the associate expense for the board to fulfill the requirements.

The condominium corporation’s board of directors is responsible for the lawful use of proxies, an obligation which can be delegated to the condominium manager, management provider business or a third party.

When administering proxy forms, condominium managers and management provider businesses must remain neutral, ethical and professional, ensuring they uphold their obligations under the law.

Section 53 of the CMSA and section 33 of the General Regulations outline the rights and responsibilities of licensees around the solicitation of proxy forms. Among the many obligations, licensees are not allowed to solicit proxies when the subject matter of the meeting in question includes:

• Any matter directly related to the licensee
• The removal or the election of one or more of the directors of the client
• Any other prescribed matter

Managers can, however, facilitate the use of proxy forms, including by distributing, collecting or holding proxy forms. Managers can also solicit proxy forms if it is solely for the purpose of establishing quorum at the meeting.

In the interest of compliance, the CMRAO may take action against a licensee who is the focus of a complaint for not adhering to their legal and/or ethical obligations when dealing with proxies. For example, the registrar may take action if the licensee:

• failed to remain neutral in the election of directors
• delivered inaccurate information to owners
• gave preferential treatment to owners known to be favourable to specific director candidates
• neglected to properly record the attendance of proxies at meetings

The Manager’s Code of Ethics

At the same time, the CMRAO developed a summary of the Code of Ethics, an important resource for condominium owners, residents and boards to be familiar with and to ensure management is in line with it. Here it is in pdf format: https://www.cmrao.ca/wp-content/uploads/2021/08/CodeofEthicsFlyer_Oct3.pdf