Bill 106 (the bill presenting changes to the existing Ontario Condominium Act) proposes significant changes to the process by which condo owners can requisition and force the holding of a special owners’ meeting. This post will focus on this.
The process under the existing Act
As it presently stands, owners can requisition an owners’ meeting provided that they get at least 15% of the registered owners to sign a requisition in support of such a meeting. The requisition must be in writing and must be signed by the requisitionists. The requisition must also state the nature of the business to be presented at the meeting and must be delivered personally or by registered mail to the president or secretary of the board or must be deposited at the address for service of the corporation.
Once a corporation receives such a requisition, the board must call and hold a meeting within 35 days (or, if the requisitionists consent to it, the meeting can be held at the next AGM).
Presently, boards do not have to acknowledge receipt of a requisition. All that boards have to do is send out to the owners a notice of the meeting, 15 days before said meeting is held. This often means that the requisitionists hear nothing for the 20 days following the communication of their requisition. They are left to guess whether the corporation will call a meeting and, if so, when. This is often the source of additional frustration and suspicion.
The proposed modifications
Under the proposed legislation, the board would have up to 50 days to call and hold a requisitioned meeting (up from the presently set 35 days). At first glance, it may appear odd that Bill 106 would provide for such an extension of time to call a requisitioned meeting. This is because the Bill introduces numerous interim steps between the requisition and the holding of the meeting. These steps are aimed at improving communications between the requisitionists and the board and at streamlining the process.
Under the proposed changes, the corporation would have 10 days to respond to the requisitionists. In this response, the corporation would have to advise whether it intends on calling the requisitioned meeting or not. This, in and of itself, is interesting in that it seems to indicate that a board may not always have to call a meeting upon receiving a requisition. In comparison, the current Condominium Act provides that the board shall call and hold a meeting properly requisitioned. Courts have found some cases where boards did not have to call and hold a meeting despite it being requisitioned by owners. We’ll save this topic for a different post.
Under the proposed legislation, if the corporation decides not to call the requisitioned meeting, it would have to advise the requisitionists of the reason(s) for this refusal. Requisitionists would then have 10 days to correct their requisition and submit it again to the corporation or they would have 20 days to bring the corporation’s refusal to hold the meeting to the Condominium Tribunal or to the Courts of Justice if the Condominium Tribunal has not been set up yet. (Read our post on the newly proposed Condominium Tribunal.)
If the requisitionists do not modify their requisition or do not bring the matter to adjudication, they would then be deemed to have withdrawn their requisition and the board would not have to call the owners’ meeting.
Withdrawal of requisitions
It is interesting to note that, under the proposed legislation, the requisitionists would also be able to withdraw their requisition, although the conditions and timing of such withdrawal are not entirely clear as of yet. Presumably, as long as at least 15% of the owners remain in support of the requisitioned meeting, the requisition would continue to stand. Could this lead to the “leader” of the requisition being unable to withdraw his/her own requisition? The timing of the withdrawal may also lead to some logistic challenges for the corporation: could the requisitionists withdraw their requisition after the board has sent out its notice of meeting to the other owners? Would the Corporation then have to hold the meeting in any event? Time will tell.
The lengthening of the process leading to the holding of a “special” owners meeting may prove to be somewhat problematic in light of the fact that the business raised at requisitioned meetings is often time sensitive. Still, the overall proposed process will likely improve communications between requisitionists and the boards.
- How the new Condo Act will affect the calling and holding of AGMs
- The new Condo Act and its impact on the adoption of budgets
- Directors’ qualifications and disclosure obligations under the new Condo Act
- The new Condo Authority and Condo Tribunal