Question: Our new strata manager declined to accept valid ‘enduring’ proxies previously recognised by strata managers for several years. Can the strata manager deny owners their right to vote?
Our new strata manager declined to accept valid ‘enduring’ proxies that have been previously recognised by strata managers and utilised without any issues for several years. The strata manager stated that the owners must resubmit these proxies using the strata manager’s specific proxy form. As a result, several owners who did not resubmit their proxies and did not attend the meeting were denied voting rights at the meeting despite being financial.
The strata manager has confirmed in writing that other strata managers and the State Administrative Tribunal (SAT) would accept these current enduring proxies. The contract agreement does not mention that owners have to submit new proxies on their forms. Can the strata manager refuse valid enduring proxies and deny owners their right to vote? Is this a breach of the strata manager’s duties?
Answer: A strata manager disregarding valid proxies without lawful justification may constitute a breach of their professional obligations.
In my opinion:
- Proxy Forms Are Records of the Strata Company: Proxy forms submitted by lot proprietors are considered records of the strata company, not personal or discretionary documents of the individual strata manager. As such, the acceptance, validity, and retention of proxy forms must be managed in accordance with the Strata Titles Act 1985 (WA) and related regulations, not at the preference or policy of a particular strata management firm.
- Validity of Enduring Proxies:
Under the relevant legislation, an enduring proxy remains valid until it is either:
- Revoked in writing by the owner who appointed the proxy, or
- The term specified on the proxy form expires.
Unless one of these conditions has occurred, the enduring proxy continues to be valid and must be recognised accordingly. It is not a requirement under the legislation that proxies be resubmitted solely due to a change in strata management or to conform with a specific template preferred by a particular strata manager.
- Potential Breach of Strata Manager’s Code of Conduct: Should a strata manager disregard valid proxies without lawful justification, this may constitute a breach of their professional obligations, including the code of conduct which requires a sound knowledge and application of the Strata Titles Act and its regulations. Owners may wish to seek independent legal advice regarding the potential implications of such actions and to ensure their rights are upheld under the legislation.
The above is not constituted legal advice; should the owners require further assistance or wish to pursue this matter formally, we recommend referring the issue to their legal counsel.
This is general information and should not be considered to be legal advice. You should obtain legal advice specific to your individual situation.
This post appears in Strata News #741.
Marietta Metzger
magixstrata
E: marietta@magixstrata.com.au
P: 08 6559 7498
If our by laws state that anyone can hold a proxy and thus anyone can be on council by proxy but Landgate states only lot owners can be on council, which is correct?
Hi Robyn
The information in this similar Q&A should assist: Question: A unit owner and Council member’s son is his Enduring Power of Attorney (EPA). Does an EPA extend to making decisions on the Council of Owners for the whole of our strata?
Hi. If a person holds a proxy and they cast a vote on an issue, (but remain silent on if they are also casting their proxy). Is the proxy vote assumed to be the same as their vote or do they have to specifically state they are also casting a proxy vote?
Can a volunteer strata manager also be a council member – is there a conflict of interest there?
Hi Maria
The following response has been provided by Andrew Chambers, Chambers Franklyn Strata Management:
If the volunteer strata manager is also a registered proprietor then yes they can also be a member of the Council of Owners if they have nominated and have been elected as per the provisions of the Strata Titles Act. The new amendments also now include the general duties and conflicts of interest relating to Council members. Section 137 covers this.
Can you please tell me is the enduring power of attorney proxy form is different than a normal proxy form
Could you please clarify can an owner bring a proxy to a Strata AGM without written prior notificatio and can the owner also be present with their proxy and pass comments in the meeting and vote?
Does a tenant in common of a lot need proxy permission from the other tenant in common to be able to vote at a meeting?
Hi Carmel
This response from Andrew Chambers, Chambers Franklyn Strata Management:
If the owner appoints a proxy to attend with them then the proxy holder subsequently enjoys all the rights in regards to voting, moving motions etc. The owner may speak with the permission of the meeting but not vote.
Any joint proprietors require a proxy signed by all proprietors appointing one to vote.
Under the Strata Titles Amendment Act 2018:
> A sole owner attending in person must vote personally rather than by proxy if both are present. So, my Enduring appointment of a person to act and vote as my proxy is over-ridden at any meeting I personally attend – I will not need to revoke the appointment.
> A person authorised under an EPOA (Enduring Power of Attorney) may vote on behalf of the owner if that owner is unable to control their property for any reason. Where an EPOA is in effect, a proxy form is not required.
Have a look at Sections 124-126 (pp.229- 231) of the STAA accessible through the link below in various formats. (pp.249-251 of the .pdf version)
https://www.legislation.wa.gov.au/legislation/statutes.nsf/law_a147203_currencies.html
What is meant by s 126(b)(ii) Strata Titles Amendment Act 2018 “… the person, who is for the time being, authorised by law to control the owner’s property may cast the vote on behalf of the owner.”?
Does it refer to an power of attorney or power of guardianship?
And must this authorisation (power of attorney etc) need to be registered with Landgate for the purpose of being granted an proxy vote at general meetings?
In WA, can an Enduring Power of Attorney or a Power of Power be used as a proxy for:
(1) a non-proprietor to be nominated and elected to the Council of Owners?
(2) a non-proprietor to replace/represent a Council Member in council meetings?
Hi Dan
We have received the following reply from Andrew Chambers, Chambers Franklyn Strata Management:
Under the current standard by-laws, only a registered proprietor (or a nominee if the proprietor is a corporation) can be a member of the Council of Owners.
More thought needs to be given to conflicts of interest.
If the Agenda contains an item that specifically relates to a particular person, it does not make sense to nominate that person as your proxy, unless you direct him/her how you wish to vote.
Also, when appointing the “Chair person”, you need to be clear (as hinted above) as to which “Chair” you mean. Further, if you have nominated the “Chair of the meeting”, that person you have envisaged may have vacated the Chair because of a conflict of interest for that agenda item.
Will an email from a proprietor giving her/his proxy to a natural person be enough? Must it be on a particular type of form? What about an SMS? Assuming that the email address and SMS phone number is verified to be from the proprietor.
If a paper form is required, what details must be captured for a proxy to be properly given? And can the proprietor use any other paper other than the form provided?
Will any of this change with the new Strata Title Amendments?
Hi Danny
We have received the following reply back from Patrick McMahon, Chambers Franklyn Strata Management:
Those provisions of the Corporations Act referred to in the comment on our post does not apply to Strata Companies in Western Australia- there is separate legislation in WA for Strata Companies (the Strata Titles Act 1985).
Whilst the Strata Titles Act 1985 is due for amendment by the Strata Titles Amendment Act 2018 (which is currently expected in the last quarter of 2019), under the current provisions of that Act the original information provided below is accurate. A proxy form signed by the authorised office bearer(s) of the company that owns the lot(s) is required, and it must nominate an actual person to vote on behalf of the proprietor(s) of the lot.
Currently, a form of proxy can only nominate a person to act as a proxy, either by their individual name or by the title of a nominated office bearer’s role – i.e. the ‘Chairperson of the meeting’ or ‘Chairperson of the strata company’. A proxy that nominates “the strata manager” (or anything similar that is not a name) is therefore not valid.
There is no current provision for electronic nomination of a proxy representative (i.e. via an email, SMS text, or similar). As per the Strata Titles Act 1985 Schedule 1 By-law 14, “an instrument appointing a proxy shall be in writing under the hand of the appointer”.
That will, however, be amended when the Strata Titles Amendment Act 2018 is proclaimed. The Strata Titles Amendment Act 2018 will feature provisions for participation at general meetings via electronic means including teleconferencing, email, etc.
Once the new legislation is proclaimed we will be informing and updating our clients accordingly.
Please provide the referen e fir the following:
“A proxy that nominates “the strata manager” (or anything similar that is not a name) is therefore not valid.
A proxy form signed by the authorised office bearer(s) of the company that owns the lot(s) is required, and it must nominate an actual person to vote on behalf of the proprietor(s) of the lot.”
The Corporations Act does not require there to be a common seal anymore, and a single director or director/secretary company is also a valid form of ownership. So, where ownership is not in the name of an individual, is it usual to appoint a representative on a permanent basis, ie. a director, or trustee, or one of several persons if there are several who have authority to represent the owner. The authorised representative can also appoint a proxy to act on their behalf for a meeting.
Consider, at an AGM, the person appointed to the chair for the meeting is not necessarily the chairperson of the strata company. Usually, however, someone representing the management company is present, although they might not always be the person who chairs the meeting. So a proxy may state “an authorised representative of Management Company” which, if an employee of the management company who currently fulfils the role of the strata manager is present that may be taken as referring to that individual.
A very common error that invalidates a proxy form is when there is more than a single owner on the title, eg. husband & wife, one attends but only one has signed the form.
If a corporate owner has not provided the strata company with an instrument appointing a representative can any of their employees (including those who claim to have a PoA) appoint themselves or others as a proxy or nominate the lot owner for election to the council?
My personal take is NO.
If the corporate owner hasn’t nominated an authorised representative (which is usually a director) who could then nominate a proxy then they do not have a valid vote.
This is a particularly commonplace misunderstanding by corporate owners as, often, the Owner (Corporate or otherwise) may be different to the Business which is operating.
So, for example, if the Corporate Owner is Dr and Mrs HMT as trustee for HMT Super Fund, and the business operating is Mingenew Surgery which rents the premises, what legal connection does the practice manager have with the Owner… absolutely none!
However, if Dr & Mrs HMT as Trustee for…. appoint Dr HMT as the authorised representative, then if unable to attend, Dr HMT can appoint a proxy for the AGM (any natural person).
At least, that’s my understanding. Perhaps a lawyer could comment?