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Is my Annual General Meeting Legal?
Just received a notice of Annual General Meeting dated 25 February 2025, with all the required items for discussion, with this note:
The Owners Corporation has by resolution, or under the current COVID provisions, determined this meeting will be held wholly via pre-meeting electronic voting. This means there will be no physical attendance at this meeting. Owners are asked to register their vote on the motions detailed in the accompanying agenda by either returning a voting paper, or by accessing an electronic voting platform.
If you suspect they have something to hide, you would be right!
Motion 16 provides:
That the Owners Corporation, under Section 46 of the Strata Schemes Management Act 2015, approves
the payment of honorariums to the chair and to the strata chairperson and the secretary totalling $97305 each in recognition of their invaluable services in initiating and leading the collective sale process on behalf of owners across
a three year period since 2022.Comments welcome
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Ran this past Robert Anderson, President of SCA-NSW who said he would have ruled this motion out of order as it states the payment is for three years when the Act says honorariums must be limited to work done in the previous year only.
I think the sneaky buggers may have shot themselves in the feet.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
The Strata Management Schemes Regulation 2016 Part 11 (SMSR Part 11) COVID provisions were repealed years ago, making it illegal to attempt an AGM using them to justify “pre-meeting electronic voting.”
The SMSR currently mandates that an AGM be held ‘in person.’ For example, SMSR clause 9 outlines the “Election of strata committee” process, while SMSR clause 14A (a) states that “an election must not be determined by pre-meeting electronic voting.” Together, these clauses mandate that AGMs must be held either physically or “by electronic means while participating in the meeting” (SMSR clause 14(a)), and not solely through pre-meeting electronic voting.
I also note that the use of the term “strata chairperson” is likely a deceptive way to refer to the “strata manager,” who appears to be attempting to take a portion of the funds. This proposed action is potentially illegal and could be considered an attempt to obtain money fraudulently. I strongly recommend that you seek legal advice.
Good luck
Ray
I also note that the use of the term “strata chairperson” is likely a deceptive way to refer to the “strata manager,” who appears to be attempting to take a portion of the funds.
I’ve seen the agenda and this is clearly not the case. The strata manager belongs to an established strata management firm which is itself a subsidiary of a larger outfit. Their worst “crime” is to facilitate this jiggery-pokery.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
Hi Jimmy,
I’m confused by the agenda item as it refers to two chairpersons:
- The chair and
- The strata chairperson
Given that there can only be one elected chairperson, I presume that the second chairperson is the strata manager. And I assume that they have been delegated chairperson authority and are now being presented as “an officer of the owners corporation” to obliquely comply with SSMA s 46, Payment of officers of the owners corporation.
But I may be missing something because I don’t have the full agenda or facts at hand.
Cheers
Ray
The reference to the chair and strata chairperson is just a mistake in the original post. The motion actually says this:
That the Owners Corporation, under Section 46 of the Strata Schemes Management Act 2015, approves
the payment of honorariums to [Person 1] and [Person 2] totalling $97305 each in recognition
of their invaluable services in initiating and leading the collective sale process on behalf of owners across a three year period since 2022.The two people, names removed, are the chair and secretary. Section 46 of the Act says this:
An owners corporation may pay to a person who is an officer of the owners corporation or another member of the strata committee of the owners corporation an amount determined by the owners corporation at an annual general meeting in recognition of services performed by the person for the owners corporation in the period since the last annual general meeting.
If they have been holding their AGMs every year, then the motion is invalid since it and the accompanying explanatory note refers to three years. The chair and secretary should have known this as at least one of them is a lawyer.
We are told that the building’s sinking fund has $250,000 in it which would otherwise be distributed to all the owners on the dissolution of the strata scheme, so the claims in the explanatory note that the chair and secretary have done the work at no cost to the owners would be obviated by these payments.
And even if the duo have truly “earned” these payments – and apparently this was all news to the scheme’s elected treasurer – trying to push it through in a pre-vote-only AGM, which itself is highly dubious, has a whiff of dodgy dealings about it.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
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