Voting: All condo units are not created equal
As discussed in a post earlier this week, there has been some confusion as of late over the phrase "units in a corporation". Does that mean all units? Only voting units? Owner-occupied units? Residential units? Fortunately, there is a section of the regulations that interprets the phrase. Subsection 1.1(1) of O.Reg. 48/01 states: In simple terms, where the Act or regulations refers to a portion of the units it means:
- owner-occupied units for business reserved for those units;
- all units, except s.49(3) units (described below); or
- all units if they are all s.49(3) units and the vote is not for owner-occupied units.
- Removal of directors (s.33(1))
- Turn-over meetings (s.43(1))
- Requisition meetings (s.46(1))
- Quorum for meetings (ss.50(1), (1.1) and (1.2))
- By-laws (s.56(10(a))
- Substantial change votes (s.97(4))
- Termination (ss.122(1)(a), 123(7), and 124(2))
- Declaration amendment - 80 or 90% of all units in the corporation depending on the change being made. This could mean 80 or 90 units would need to consent in writing to the proposed amendment. Some argue it is 80 or 90% of the 50 voting units only as the non-voting units are not able to vote. Others argue it is not technically possible because the Act says the non-voting units cannot vote and the Act requires 80 to 90% of all units. To add to the debate, the declaration amendment section also uses the term "consent" instead of vote so some argue the non-voting units may consent, but not vote. It is unfortunate that the regulations did not clear up the ambiguity for declaration amendments. Hopefully a future amendment will address this issue.
- By-law amendment - majority of voting units, unless the regulations indicate it is a by-law that may be passed by a majority of units present at the meeting (see our previous post about this here). This means 26 units for by-laws requiring a majority of voting units. For by-laws passed by a majority present at the meeting it could mean as few as a majority of those present (note: enough units must be present to achieve quorum). If only a quorum (i.e. 25% of voting units) is present at the meeting the magic number is only 7 units out of the 100 units.
- Rules - there is a bit of debate about this one too, but my opinion is it requires a majority of votes cast at the meeting (by show of hands, ballot or proxy) not to be against the rule. Again, quorum (25% of the 50 voting units) must be present at the meeting. This could be less than 7 units if every unit at the meeting does not cast a vote for or against the rule.