There is presently a fair bit of confusion with respect to how a special meeting of owners is requisitioned and called. This is due, at least in part, to the fact that we are still in a transition period between the “old” and the “new” Condo Act. In this post we explore the steps required to requisition and to call a special meeting of owners during this period of transition.
What is a “special meeting of owners”?
Condo owners meet at least once a year at the Annual General Meeting. Barring exceptional circumstances, this meeting must be held within 6 months of the end of the fiscal year. In addition to the AGM, the board may call other meetings of owners, on its own initiative, to discuss any matter relevant to the affairs and business of the corporation.
In addition to these meetings called by the board, owners can also requisition a meeting of owners. Ultimately, the meeting is still called by the board, but it is as a result of a requisition from owners. These meetings can be requisitioned to discuss or vote on a rule, to discuss a matter of concern to the owners or even to remove directors before the end of their term.
How do owners requisition a meeting of owners?
A requisition for a meeting of owners must be in writing and must be signed by owners who own at least 15% of the units of the corporation. I realize that some people feel that drumming enough support to requisition a meeting is a difficult task but, when you think about it, 15% is a rather low threshold to requisition a meeting. If you cannot get 15% of your neighbours to sufficiently support your “cause” to at least request a meeting of owners, then, perhaps, the cause in question is not that important to the community.
The requisition must state the nature of the business you want presented at the meeting. Ultimately, the board still sets the agenda, but owners get to state what they want dealt with at the meeting.
If the purpose of the meeting is to remove a director, the requisition must state the name of the director(s) to be removed and the reason for the proposed removal. The requisition must also state whether the director to be removed is one who can only be voted in/out by owners occupying their unit.
Which form should be used?
Presently, there is no specific form required to be used to requisition the meeting. Owners can make their own requisition form. You want to carefully draft your requisition because it will be included in the package to be sent to the owners. This is your best chance to clearly present your position to other owners. You also want to ensure you do not disseminate defamatory or false information. In my experience, there is no need for the requisition to be very lengthy and there is no need for it to be overly aggressive.
The requisition must be delivered personally or by registered mail to the president or secretary of the board or deposited at the address of service of the corporation. In many cases, corporations will accept to receive it by email or through the management company.
How quickly must the board hold the meeting
This is where the confusion presently exists. Under the “new” version of the Act, there will be a process of back and forth between the requisitionists and the board. These sections of the Act are not in force yet.
Presently, the board must hold the meeting either:
- Within 35 days following the receipt of the requisition; OR
- If the requisitionists consent in writing, the requested business can be presented at the following annual general meeting;
An additional challenge exist due to the very short time frame between the receipt of the requisition and the time by which the preliminary notice must go out. Indeed, as stated above, the board must hold the meeting of owners within 35 days following the receipt of the requisition. Those familiar with the requirements of the preliminary notice will have picked up on the fact that, normally, a preliminary notice must also be given 35 days before the meeting. Clearly, this does not leave the board any time to turn around and generate the required preliminary notices. The board would have to send the preliminary notice on the same day it receives the requisition!
Therefore, when meeting of owners are the result of a requisition, the pre-notice period is slightly shortened. Indeed, in these cases, the Preliminary Notice must go out only 30 days before the meeting. Still that only gives the board 5 days from the receipt of the requisition to send out the preliminary notice.
Deadlines and counting the days to the meeting
Let’s use an example. Let’s say the corporation receives the requisition on Friday, June 1st, 2018:
- The Preliminary notice must be given to owners by Wednesday June 6 – often requiring the board to scramble over the weekend to deal with the requisition;
- The meeting must be held no later than July 6;
- Assuming you hold the meeting on July 6, another notice must be given no later than June 21.
Recently, one of my corporations received a requisition. When considering the weekend surrounding the Preliminary Notice and the weekend around the date the meeting had to be held, the corporation was only left with one day to turn around and issue the Preliminary notice !
What if the meeting is not called in time?
If the board does not hold the meeting within the time frame provided above, a requisitionists may call the meeting of owners, which shall be held within 45 days. When the meeting is called by the requisitionists, the corporation shall reimburse the reasonable costs incurred in calling the meeting.
At the meeting
The meeting is still called by the board. The board sets the agenda and chairs the meeting as it would at any other meeting.
Regrettably, these meetings can be quite divisive. To begin with, they are usually the result of discontent amongst owners. They are also often the result of an opposition to an initiative from the board. Unsurprisingly, the board’s initial reaction may be one of hurt or even anger.
It does not have to be.
A requisition should be received as an invitation to re-think something that the board is proposing or as a discussion on a topic of significant interest to the owners. It does not have to be a “them against us”. Whether you are part of the owners requisitioning the meeting or whether you are part of the board receiving the requisition, be zen about it and welcome this opportunity to have a healthy, courteous and respectful discussion about the kind of community you want to live in.
In most cases, it is a good idea to have the corporation’s lawyer present. He or she will ensure that the meeting unfolds in an orderly fashion and in full compliance with the Act. The corporation’s lawyer can also help ensure that everyone gets a chance to speak and be heard. He or she often has the required emotional distance to help the ownership navigate through what can be an emotionally charged meeting.
Expect this to change
Don’t get attached to the method described in this blog post. It will significantly change when Ontario implements the latest version of section 46.
- Make sure your requisition is not defamatory
- Calling a special owners meeting under the new Act (the process described in this blog post is not in force yet)