This article about the coming restrictions to proxy farming in NSW has been supplied and written by Allison Benson, Kerin Benson Lawyers.
Don’t get caught out. If you want to ensure your proxy votes are valid you should ensure you comply with the new proxy farming restrictions in the NSW strata reforms. Otherwise, you may be on the outside looking in and unable to vote. Be aware there are new limits on proxies, the most important of which is in schedule 1, cl 26(7) of the Strata Schemes Management Act 2016 (NSW). This clause states:
“(7) Limit on number of proxies that may be held The total number of proxies that may be held by a person (other than proxies held by the person as the co-owner of a lot) voting on a resolution are as follows:
(a) if the strata scheme has 20 lots or less, one,
(b) if the strata scheme has more than 20 lots, a number that is equal to not more than 5% of the total number of lots.”
What does this mean? Quite simply, if your strata scheme has 20 lots you can hold 1 proxy vote in addition to the vote for your lot. If your scheme has 21 lots or more it becomes a little more complicated and we have to do some mathematics as you need to calculate the number of lots in your scheme that total 5% or less.
To make it easier I have set out my calculations below and a table setting out the maximum number of proxies one person can hold:
If you have a 21 lot scheme: you can only hold 1 proxy in addition to your lot’s vote. Why? 1/21 = 4.75% so it is not more than the 5% allowed. But holding 2 proxies would not be permitted as it would exceed the 5% of total lot limit.
Essentially, you as a lot owner can hold the following proxy votes:
If you are not a lot owner you can only hold up to the maximum number of proxies, for instance, if it is a 60 lot scheme, you can hold three proxy votes.
What to do if you feel intimidated or want to avoid confrontation at a general meeting?
- Have someone attend with you either as a support person or as your proxy. If you want to have someone speak on your behalf you should nominate them as your proxy. Why? Your proxy is essentially standing in your shoes and has the same rights that you would have. You can still attend the meeting however if you vote, your proxy cannot also vote on the same motion.
- If you cannot attend, and the person you would like as your proxy cannot physically attend the meeting, then you should complete a proxy form (making sure you provide your lot number, name and the name/position of your proxy on the form and date and sign the form) and submit it to the Secretary of your owners corporation in time (in NSW for large schemes this is 24 hours before the meeting or for small schemes of under 100 lots, it is prior to the commencement of the meeting). If you want to vote in a specific way for a certain motion then specify this on your form.
- Speak to your strata manager beforehand and let them know of your concerns. Your strata manager, if warned can intercede to try to keep emotive comments to a minimum and to keep comments constructive.
- More generally, play the ball and not the person. Try to stay away from making comments on individuals and keep your comments on issues constructive and encourage others to do the same.
- Finally, if the discussion starts getting heated or off track, reminding everyone of the motion to be voted on and time constraints can often cut through arguments.
Remember, the important thing is that your vote is counted. Your home is often your biggest investment you will make and as part of managing this investment it is vital that you are informed and active in your owners corporation. This includes attending meetings whether in person or by proxy.
This post appears in Strata News #118.
Please note: This is not legal advice. You should seek legal advice particular to your situation.
Are you interested in more information about NSW Reforms relating to proxy farming restrictions in NSW or information particular to NSW strata legislation? Visit our Strata Law Reform OR NSW Strata Legislation pages.