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Condos’ E-Meeting and E-Voting By-laws

A lot has been written about virtual AGM’s and electronic voting lately.  These concepts are not new but their requirement is being precipitated by the current pandemic. In this post, we set out the step-by-step process by which your condo corporation can eventually hold virtual meetings and get owners to votes electronically.

Don’t miss our webinar on Wednesday at 5 pm. We’ll cover this and more.  Click here for more info and our registration form.

You need a by-law

Traditionally, the Condominium Act required that meetings of owners be held “at a place”. Owners could participate in person or by proxy.  This physical presence (or proxy presence) was required for owners to count towards quorum and to cast their vote.

In 2017, the Condominium Act was amended to allow for both electronic meetings and electronic voting but only if the corporation has a by-law permitting it.

Amid the current pandemic, British Columbia and Nova Scotia have adopted Emergency Orders allowing corporations to hold e-meetings and e-voting even without a by-law (for the duration of the emergency crisis).  Ontario adopted a similar one on April 24, after the original publication of this post. You can read more about it here.

So, for now, to hold virtual meetings and to allow e-voting, you need a by-law.

[Note to readers: Ontario’s latest Order in Council temporarily permits e-voting and e-meetings even without a by-law for the duration of the emergency period.]

Why are e-meeting and e-voting useful?

Adopting an e-meeting and e-voting by-law is required now more than ever. Such a by-law will allow the corporation to hold owners meetings (including AGMs) for the duration of the pandemic but it will also provide owners with more flexibility after the pandemic ends.

Indeed, e-meetings and e-voting will increase owner participation by allowing busy professionals, those who are travelling and those with limited mobility to easily participate to the meeting from the comfort of their home. It will also facilitate the participation of professionals such as the auditor or the lawyer.

As for e-voting, it offers more flexibility, allowing owners to easily vote, online, even before the start of the meeting. It also provides the corporation with instantaneous and reliable voting results. No more counting of the ballots. Finally, e-voting is a lot simpler than the current complicated proxy.

What should go in your by-law?

This is tricky. You should really get your legal counsel to help with this but here’s what we have to say.

Certainly, the starting point is that the by-law should address (at least) the following two items:

  • Virtual meetings
  • Electronic voting

It’s important to note that your by-law must allow for both.  Most e-voting by-laws adopted before this pandemic likely only address the voting element.  Your by-law needs to also allow for virtual meetings.

While it’s not essential, you might as well throw in a third possibility: mail-in ballots. That too is permitted under the Condo Act.

In our view, it is essential for both the e-meeting and e-voting to provide owners with a robust and reliable system that will allow:

  • Full owner participation
  • Transparency
  • Accountability, and
  • Proper record keeping

Indeed, it is important that your by-law provide you with the required flexibility and transparency without compromising the integrity and reliability of the democratic process. This new technology should not be used to deliberately (or  inadvertently) suppress owner participation. Imagine a virtual meeting controlled solely by an ill-intentioned chairperson who can stifle participation and who can ignore difficult questions…

To avoid this nightmare, all owners should be provided with a meaningful level of participation. They should see/hear all questions posed and all answers provided and they should be able to observe, in real time, any vote by show of hands. The system should also allow for secret ballots. Finally, the voting system should result in a reliable record to be added to the records of the corporations. In our view, the voting report should be treated like a ballot for the purpose of record keeping.

We have been in discussions with the two main electronic voting providers to understand their processes and software features. With this information, we have developed a by-law that works with their systems and meets all of the statutory requirements, while preserving the democratic process.

When to adopt this by-law?

With the pandemic showing no sign of ending soon, we recommend proactively adopting this by-law even if your AGM is not set to take place for a while (and even if the province temporarily suspends the requirement for such a by-law). Adopting the by-law now will allow the corporation to continue to hold its required meetings (when/if required) but acting now has the added benefit of proposing the by-law at a time where owners are attentive to the reason why this by-law is required. Best to strike the iron while it’s hot.

How to adopt this by-law?

Adopting a by-law requires that it be put to a vote of owners. Normally, this is done in the context of … a meeting of owners. This is where the problem becomes circular:

You need to hold a meeting to adopt a by-law allowing you to avoid the requirement of a meeting…

You can tackle this by holding a “proxy-meeting”. That is by calling a meeting of owners but where their participation will be “on paper”: Owners are going to be asked to only show-up by proxy. For this to make sense, you need to fully explain to the owners the objective and the process.

We would propose the following steps:

  1. The board approves the electronic by-law;
  2. You send the Preliminary notice out to your owners.  Use our AGM Calculator to calculate when to send your notices;
  3. Include a very clear explanation to the owners and a very clear set of instructions. In many cases, we recommend a prior “town hall” conference (a pre-meeting of sorts) to fully explain the process to owners and answer any questions they may have;
  4. Include a proxy that is directed to the person who will hold the meeting (the chairperson). Indeed, the proxy holder must be present at the meeting. Put the by-law vote as a single agenda item and invite owners to vote in favour or against it;
  5. Send the General notice out, at least 15 days before the meeting;
  6. On the day of the meeting, the chairperson gathers the proxies and counts the votes. If the physical location permits it to be done safely, you could have scrutineers in attendance (while keeping the required social distancing and ensuring you don’t have more than 5 people present). An additional option is to stream this meeting (through a virtual conference) to allow owners a certain level of participation.  Technically, the meeting is done on paper, but owners can login to watch and participate;
  7. Announce the results to the owners;
  8. Register the by-law on title.

By-laws normally need to be supported by the majority of all registered units. This by-law however only required a “reduced” majority. It is sufficient for the by-law to pass if the majority of owners participating to the meeting vote in its favour. This takes care of the usual difficult hurdle of having to gather the support of the majority of all units.

Having stated the above, we must caution our readers. As it currently exist, the Condo Act did not strictly anticipate these kinds of e-proxy meetings.  For that reason, we are of the view that these proxy-meetings may not be appropriate for all types of meetings of owners. Still, we are of the view that, in the current pandemic circumstances, with the appropriate level of communication and safeguards, these proxy-meetings are adequate, certainly to adopt e-voting and e-meeting by-laws to allow the corporation to continue to hold meetings.

Our electronic proxy may help

In addition to our new by-law, we have developed a new Condo Adviser tool: an online proxy!

Our electronic proxy will facilitate the adoption of your by-law. Indeed, owners will be able to complete and submit their proxy online, from the comfort of their home, directly from our blog.  They’ll submit their proxy with a push of a button.

Upon doing so, they’ll immediately get a confirmation that the proxy has been submitted and they’ll get a copy of their proxy for their records.

On the day of the “proxy meeting”, the proxies will be sent to the manager (or to individual identified by the corporation). All you’ll have to do is count them.

This should greatly facilitate the passing of this bylaw. Don’t be shy to ask us about it!

Don’t miss our webinar on Wednesday at 5 pm. We’ll cover this and more.  Click here for more info and our registration form.