Managing Meetings Without a Quorum
Understanding the Impact on Resolutions and Decision-Making
At Solver Property Services, we specialise in managing community schemes for Body Corporates and Homeowners Associations. A frequent inquiry we receive from Sectional Title Developments is whether decisions can still be made at an annual meeting if it loses its quorum. Let's explore the legal stipulations and how to effectively handle such situations.
What is a Quorum?
A quorum is the minimum number of members required to be present or represented by proxy for a meeting's proceedings to be valid.
Legislative Requirements for a Quorum
Per PMR 19, no business can be conducted at any general meeting unless a quorum is present. This quorum must be maintained throughout the meeting for all resolutions to be valid.
Agenda and Quorum Maintenance
According to PMR 17(6), the order of business at general meetings includes verifying proxies and confirming the quorum. Each resolution must be discussed, voted on, and documented in the minutes by the chairperson. Maintaining the quorum for the entire meeting is crucial to ensure the legitimacy of all resolutions.
The Importance of a Quorum
PMR 17(8) highlights the necessity of having all resolutions approved. If any item requiring member approval is not passed, it must be revised and presented for approval in future meetings until it is accepted.
Minimum Quorum Requirements
PMR 19(2) outlines the quorum requirements:
For schemes with fewer than four sections or members, a quorum consists of members holding two-thirds of the total votes.
For other schemes, it consists of members holding one-third of the total votes, with at least two persons present, excluding the votes of the developer and sections owned by the body corporate.
Differentiating Between Quorum and Voting Requirements
Different decisions in sectional title schemes require varying levels of agreement. Generally, more significant decisions affecting members financially demand a higher level of consensus.
Ordinary Resolutions
PMR 20(1) states that ordinary resolutions at a general meeting do not require a seconding motion and must be passed by a majority of the votes of members present and voting.
Special Resolutions
Special resolutions need at least 75% approval, both in value and number. If less than 50% of the total value of votes is represented, the resolution is not immediately effective. Members holding at least 25% of the votes can request a special general meeting to reconsider the resolution.
Unanimous Resolutions
Unanimous resolutions must be approved by all members at a meeting where at least 80% of the votes, both in value and number, are present or represented. These resolutions have higher quorum requirements.
What Happens If Quorum Requirements Are Not Met?
If a quorum is not present within 30 minutes of the scheduled start time, the meeting is adjourned to the same day and time the following week. If the quorum is still not met, the members present will then constitute a quorum.
Conclusion
Legislation clearly dictates that no business can be conducted without a quorum. This requirement ensures democratic participation and fair representation in decision-making processes. Both quorum and voting requirements must be met to validate resolutions, ensuring that the interests of all members are fairly represented.
At Solver Property Services, we are dedicated to helping you navigate these legal requirements efficiently, ensuring that your meetings and resolutions comply with the Sectional Titles Act and Management Rules.
Disclaimer: Kindly note that the above article is merely for information, and is not intended to be comprehensive, to provide legal advice or to assist Community Schemes with the discharge of their fiduciary duties. It does however cover some important aspects on trustee responsibilities, body corporate insurance, Sectional Title insurance replacement values, and more.
Solver is amongst the larger property managing agent companies in South Africa and have been managing community schemes effectively since 2005. High-rise sectional title buildings, Homeowners Associations, share blocks, apartments, we manage it all. For more information, please contact 010 822 2882. Solver Property Services has a team of experienced Property Managers / Managing Agents that can assist you.
