This article about changes to the way you deliver written votes for open motions (and now also proxies?) after a new decision in Queensland has been supplied by Bradley van Xanten, UOAQ President.
Written votes: the waters have been well and truly muddied
The UOAQ ‘s NewsFlash #84 urged any voter who wishes to have their written vote safely counted on an open motion for a general meeting to comply strictly with the requirement it be given directly to the Secretary by hand, by post, or by facsimile (including by e-mail).
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This followed a very recent Adjudication in Whitsunday Waters Resort [2020] QBCCMCmr 84 (as yet unpublished) which saw two critical written votes voided because they were sent to the BCM by e-mail and by facsimile respectively. The Adjudicator held that “These votes are invalid and the motion failed for that reason”.
We saw this decision as a game-changer; it challenges a long-standing convention for written voting papers to be given to the Secretary care of the BCM’s address.
We predicted – correctly it turns out – it would be closely examined by various strata professionals; several strata lawyers have now published articles about it. There are variations in their analysis and conclusions – they are, after all, lawyers – but there seems to be one consistent message ie consternation.
What is very surprising is that we are yet to see any written discourse on the implications, if any, for proxies.
What about proxies you may well ask
Seems like same same, but only slightly different.
The operative words about the delivery of written votes are set out in s.84(2)(b) of the Accommodation Module (AM), and s.86(2)(b) of the Standard Module (SM):
A voter casts a written vote by giving the (completed) voting paper to the secretary (by hand, by post or by facsimile) before the start of the meeting.
The same words – although in slightly different order – are employed in Chapter 5 of both Modules, which regulates proxies for committee meetings and for general meetings as follows:
- For committee meetings:
AM s.98(2)(a)…The appointment of a proxy is effective only if the member or holder of the proxy gives, by hand, by post or by facsimile, a properly completed proxy form to the secretary before the start of the meeting… - For general meetings:
AM s.105(5)(a)…The appointment of a proxy is effective only if the voter or holder of the proxy gives, by hand, by post or by facsimile, a properly completed proxy form to the secretary before the start of the meeting…
(Both sections appear in the SM at s.100(2)(a) and s.107(5)(a) respectively.)
Grammarians, or contrarians, may argue that the different order of the words is significant; we can only leave this to be determined in the appropriate jurisdiction.
The UOAQ does note that when the amendments to the sections regarding written votes and proxies were explained in 2003, the explanatory memorandum explicitly stated for all three amendments that “The voter/proxy giver/proxy holder cannot give the completed voting paper/proxy to another person to hand to the secretary.” There is no distinction drawn between written voting papers and proxies.
The UOAQ is unaware at this stage of any Adjudications etc on the meaning of the words ‘give, by hand, by post, or by facsimile’ regarding proxies. It will be interesting to see how this whole mess turns out.
In the meantime, the UOAQ suggests strict compliance with written votes AND with proxies.
| Written votes for general meetings – AGMs and EGMs | Proxies for committee meetings – between voting members only | Proxies for general meetings – AGMs and EGMs |
| *AM s.84(2)(b) **SM s.86(2)(b) A voter casts a written vote by giving the voting paper to the secretary (by hand, by post or by facsimile) before the start of the meeting. *BCCM (Accommodation Module) Regulation 2008 [AM] | AM s.98(2)(a) SM s.100(2)(a) The appointment of a proxy is effective only if the member or the holder of the proxy gives, by hand, by post or by facsimile, a properly completed proxy form (BCCM Form 7) to the secretary before the start of the committee meeting where the proxy is to be exercised. NB: The Form 7 can be given to the secretary either by the committee member OR by the appointee proxy-holder ie the member can give it to the proxy-holder to give to the secretary | AM s.105(5)(a) SM s.107(5)(a) The appointment of a proxy is effective only if the voter or the holder of the proxy gives, by hand, by post or by facsimile, a properly completed proxy form (BCCM Form 6) to the secretary before the start of the meeting where the proxy is to be exercised. NB: The Form 6 can be given to the secretary either by the voter OR by the appointee proxy- holder ie the voter can give it to the proxy-holder to give to the secretary |
| BCCM Legislation Amendment Regulation (No.1) 2003 SL263 p.48 Amendment of s.49*: The amendment reflects this (strict) approach by providing that if a voter completes a voting paper, that voter has a choice of giving the completed voting paper to the secretary himself or herself by hand, or by post, by facsimile or electronically. The voter cannot give the completed voting paper to another person to hand to the secretary. *Equivalent of current AM s.84 and SM s.86 | BCCM Legislation Amendment Regulation (No.1) 2003 SL263 p.55 Amendment of s.64*: The amendment provides that only the voting member of the committee making the appointment or the voting member who has been appointed as proxy can give a completed proxy form to the secretary. These persons cannot give the completed proxy form to another person to hand to the secretary. *Equivalent of current AM s.98 and SM s.100 | BCCM Legislation Amendment Regulation (No.1) 2003 SL263 p.56 Amendment of s.70*: The amendment reflects this (strict) approach by providing that the voter for a meeting making the appointment or the person who has been appointed as proxy by the voter can give the proxy form to the secretary himself or herself by hand, or by post, by facsimile or electronically. The person cannot give the completed proxy form to another person to hand to the secretary. *Equivalent of current AM s.105 and SM s.107 |
QLD: Written Votes for Open Motions. Send to the Secretary, not the BCM!
The UOAQ has been alerted to a very recent adjudication (as yet unpublished) which voided two written votes cast in favour of a motion at an Annual General Meeting. They failed because they were sent by the owner/voters via the body corporate manager (BCM) rather than directly to the elected Secretary of the body corporate committee. The motion required a special resolution and the two votes were critical to the motion’s success. Adjudicator A. Stone ordered that because these two votes were invalid the resolution in favour of the motion was at all times void. Refer: Whitsunday Waters Resort [2020] QBCCMCmr 82, (21 February 2020).
Although this Adjudication seems to have come out of left-field, there is a history of similar decisions on the same point, and which were cited favourably by Adjudicator Stone as follows:
- Van Deurse & Anor v Q1 Management Pty Ltd & Anor [2017] QCATA 113, paras.91-93
- Cypress Apartments [2018] QBCCMCmr 365, paras.58-60
- Cypress Apartments [2019] QBCCMCmr 249, paras. 13-14.
Relevantly, a contractual arrangement between the BCM and the body corporate allowing the BCM to exercise some or all of the powers of the executive members of the committee (including the Secretary) did not prevent invalidity of the voting paper when sent to the BCM acting in the capacity of secretary.
Relevant Law – Accommodation Module (AM)
AM s.68(3)(c) requires that the notice of general meeting must be accompanied by a voting paper for all open motions to be decided at the meeting
AM s.69(4)(e) requires that the voting paper must enable a person who is a voter for the general meeting to cast a written vote on each motion to be considered at the meeting
AM s.84(1) provides that when exercising a vote at general meetings:
A voter may vote on a motion, other than a motion to be decided by secret ballot, in any of the following ways-
- personally;
- by proxy;
- by casting a written vote;
- if the body corporate has by ordinary resolution decided that voters for general meetings may record votes electronically for open motions—by casting an electronic vote.
AM s.84(2) goes on to elaborate that:
A voter casts a written vote by—
- completing the voting paper as required by the accompanying instructions; and
- giving the voting paper to the secretary (by hand, by post or by facsimile) before the start of the meeting. (Emphasis added)
Adjudicator Stone noted that “When the section [(s.84(2)] was amended to its present form in 2003, the explanatory memorandum explicitly stated: “The voter cannot give the completed voting paper to another person to hand to the secretary.”. Seemingly this includes BCMs.
Relevant practice
When issuing the general meeting papers, it is common practice for BCMs to include instructions that written votes for open motions can be directed to the body corporate via the BCM, rather than directly to the secretary of the body corporate.
This practice is now seen to be in breach of the BCCM legislation and the written votes will be voided.
So What Should You Do?
The abovenoted decisions by QCATA and the Adjudicators are game-changers and will be closely examined by the strata professionals, especially the BCMs. Change like this will have a significant impact on those BCMs who are ever-reliant on their software templates. The UOAQ would not be surprised if there is an appeal to a higher jurisdiction to clarify the position.
In the meantime, and unless it is overturned on appeal, the current law is good law and needs to be followed.
We believe that any voter who wishes to have their written vote safely counted on an open motion would be wise to comply strictly with s.84(2)(b) ie by giving the voting paper directly to the Secretary either:
- by hand; or
- by post to the Secretary’s postal address; or
- by facsimile (including e-mail) to the Secretary’s fax number (or e-mail address.)
If the voting papers do not include the Secretary’s personal contact numbers, then contact the BCM.
NB: AM s.68(3)(c) & s.84 (1) apply to open motions only. They do not apply to motions to be determined by secret ballot which have their own special rules.
This post appears in Strata News #324.
Have a question or something to add to the article? Leave a comment below.
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Bradley van Xanten
UOAQ President
Unit Owners Association of Queensland (UOAQ)
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This article has been republished with permission from the author and first appeared on the UOAQ website.
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As a secretary of a body corp, I suppress my personal contact details and specify “Care Of” to our appointed body corp manager via their postal address and email. Perhaps it is the wording on the address label that Whitsunday Waters Resort case is the issue, rather than the actual address. Perhaps until all is resolved on the matter all General Meeting Motions should be conducted as secret motions – which clearly indicates all votes to the returning officer.
Martin… secret ballots for all motions may solve one problem, but then create another. I’ve been involved with a body corporate which opted for the ‘All Secret Ballots’ path; this involved a motion at an AGM (No.1). At the next AGM (No.2), the 35+ owners sat there like stunned mullets for about 60 minutes while the Returning Officer counted the votes. Then the Chairman declared the results and we all went home. What an anti-climax.
It took another AGM (No.3) – with 100% secret ballots – to undo this mess – with a secret ballot – and revert to ‘mainly open motions’ at the next AGM (No.4).
I hope they sort out the ‘by hand, by post, by fax’ problem asap, so we don’t have to look at band-aids to help the system work. It is clunky enough as it is..
Martin…if I was a Secretary, I would not be too fussed on the ‘by hand’ option at the moment. You wouldn’t know where those voting papers and proxies have been. Electronic delivery is better for the time being.
There are also quite a few decisions that accept submitting documents to the body corporate manager is sufficient.
Hopefully Whitsunday Waters Resort isn’t the new leading decision on this issue otherwise there may not be any secretaries left (and haven’t been any valid decisions of any bodies corporate for quite a while).
Todd…maybe the Whitsunday Waters adjdn has opened the floodwaters? Time and tide will tell…
S84(2) allows an owner to send a voting paper to the Secretary via facsimile (and presumably email). If the Secretary’s email is the same as the body corporate manager would this still be a problem. For example, the Secretary’s details could be promulgated as the PO Box of the BCM and the BCM’s email address.
Seems so.
But if there is any doubt, seems best to get the direct number or contact details of the Secretary and send the written vote direct. That way there can be no questions of validity.
This whole matter looks like a right stuff-up which could scare off a lot of Secretaries,
Seems it also applies to Proxies, both between cmttee members for cmttee meetings (Form 7) and for general meetings (Form 6). Same words in the Module Chapter 5 for PROXIES, and same comments in the Explanatory Note to Parliament in 2003