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  • #52035
    AvatarRJM
    Flatchatter

    Hi everyone,

    First time poster here with an issue that seems somewhat unique (I have searched the forums but can’t quite find anything that relates closely enough). I have tried to summarise the situation as succinctly as I can below:

    I am a member of an Owners Corporation in Victoria with 20 lots
    At the last AGM (November 2019) three owners were present: Me/’K’/’J’ (a proxy for ‘P’)
    The Minutes presented by the Manager listed the committee as Me/’P’/’R’. R was on the committee previously but was not at the AGM in person or via proxy and did not submit a nomination for committee election.
    Six days after the issuance of the Minutes I emailed the Manager advising that I thought the committee was detailed incorrectly (as it should have read Me/P/K). The Manager replied with ‘Apologies’
    The Manager did not amend the Minutes but did not attempt to clarify the situation either
    The Manager corresponded exclusively with myself/P/K from the AGM in November 2019 until June 2020 regarding committee decision making. R was not involved in a single email or decision over this period.
    I called a committee meeting (as secretary) in August 2020 to terminate the Manager and appoint a new management company. Myself and K were (are) in favour of terminating the management company. Both the Chair (P) and the Manager refused to acknowledge it as a valid committee meeting because I did not invite R and that R needed to be involved in the decision.
    Myself and K insist that K was elected as a committee member at the 2019 AGM (and that R is not a committee member). This is on the basis that we were both present at the 2019 AGM; hold a majority view (ie. 2/3) of lot owners present at the meeting regarding the election of the committee; and the fact that neither P nor the Manager sought to include R in any committee decision making from November 2019 to June 2020. In our view this implies that both P and the Manager understood the committee to be Me/P/K, and that if they thought otherwise they had an obligation to raise it much sooner than seven months after the AGM
    P and the Manager now insist that R is a committee member, citing the Minutes themselves and the ‘evidentiary value of their notes’ (P’s proxy at the meeting took notes and alleges there was no change to the committee from the previous year, which is consistent with the Manager’s ‘notes’)
    P as Chair refuses to acknowledge any wrongdoing on the Manager’s part and is therefore not supportive of terminating the Manager
    Despite the confusion and somewhat heated debate in recent months, P has called a committee meeting for Tuesday week and invited myself/K/R. He believes that ‘consensus’ from all four owners on a motion will constitute a binding resolution
    The OC’s financial year end took place a few weeks ago and P has set the AGM date for late October. I suggested that the committee meeting be cancelled and the AGM brought forward to resolve the matter once and for all. P rejected this on the grounds that the Manager allegedly isn’t available until late October. The Manager has since confirmed that they’ll attend the committee meeting Tuesday week.

    I would like to understand, without doubt, who the validly elected members of the committee are. Any ideas? What a mess!

    Many thanks.

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  • #52103
    AvatarRJM
    Flatchatter
    Chat-starter

    Thank you all for your comments and suggestions.

    The contract expired last year so at least that part isn’t an issue. I’ve checked it thoroughly and there isn’t any form of rollover clause either.

    I’ve consulted some legal professionals (informally) and they’ve encouraged me to hold my ground in insisting that the committee is myself/P/K. They believe there is enough evidence to suggest that this is the ‘factual situation’ despite the ‘prima facie’ evidence of the AGM minutes (that are legislatively incorrect).

    They also have advised that P doesn’t have the power to override the OC legislation by saying that ‘unless a resolution is unanimous it’s not binding’ on the basis that it would be an ‘illegal interference in an otherwise valid committee decision making process’.

    Wish me luck next week!

     

    #52055
    AvatarAustman
    Flatchatter

    a ‘plot’ that is undoubtedly being blocked by P, R, and the Manager.

    And they would have the numbers (if R actually was a committee member) to keep the SM with the chair’s casting vote.

    Check the SM’s contract termination conditions.  Not only must the appropriate notice to given before the contract anniversary, but also in many standard SCA contracts, that the notice must be supported by a vote of the OC at a General Meeting.

    So make sure the committee alone actually can terminate the SM’s contract.  Very often it can’t.

    If it’s a numbers game, and if the timing is critical,  exercise your right to call a Special General Meeting and let the OC decide.

     

     

     

    #52054
    Sir HumphreySir Humphrey
    Strataguru

    … the Chair P has determined that if voting is unanimous amongst the four of us (P,K,R,me) then a resolution will be reached – and if unanimity can’t be reached on a motion then the decision will have to wait until the AGM. I do not see this as acceptable. Both K and I have made it clear that we’d like to terminate the Manager – a ‘plot’ that is undoubtedly being blocked by P, R, and the Manager.

    If something were resolved unanimously, it would not matter whether R were a member of the committee or not. So, that bit seems reasonable.

    I assume that it is up to the AGM to resolve to enter into a contract with the same manager or an alternative in Victoria like the ACT that I am familiar with. I am assuming you don’t yet have a quote or proposals from an alternative manager so it is hard to see how you could persuade the committee to recommend an alternative. You could put a motion to the AGM that the manager’s contract be allowed to run till some date according to whatever the contract allows but that the incoming committee must call a meeting to consider proposals from the current manager and alternative(s) by some date that would enable notice to be given to the current manager in accordance with the contract etc.

    A prospective alternative manager would no doubt be very happy to advise about how to engineer regime change.

    #52050
    AvatarRJM
    Flatchatter
    Chat-starter

    Sir Humphrey – thank you, just missed reading your post before posting.

    The issue is that there are matters to resolve prior to the AGM (which has been delayed for no apparent reason) and it is not clear who will actually have voting rights at this ‘committee’ meeting Tuesday week. The Manager seems to insist that R is now a committee member, and the Chair P has determined that if voting is unanimous amongst the four of us (P,K,R,me) then a resolution will be reached – and if unanimity can’t be reached on a motion then the decision will have to wait until the AGM. I do not see this as acceptable.

    Both K and I have made it clear that we’d like to terminate the Manager – a ‘plot’ that is undoubtedly being blocked by P, R, and the Manager.

    #52051
    AvatarAustman
    Flatchatter

    So, I wonder why has this become an issue all of a sudden?

    From going through the exercise of changing an SM, I do know that timing can be critical.

    While it will depend on the OC’s contract with the SM, there is usually a requirement to give enough notice of the OC’s termination decision before the anniversary of the SM’s contract.  Else the SM’s contract is automatically renewed.

    And with R allowed to vote, there is the potential that the vote will be 2-2.   In which case the chair gets a casting vote.  With the chair in favor of the SM, we know which way that casting vote will go…

    If it really is likely to be a numbers game, perhaps the OP is best to call a Special General Meeting.   At least that will resolve the matter.

     

     

     

     

    #52048
    AvatarRJM
    Flatchatter
    Chat-starter

    Jimmy T and Austman – thank you very much for your responses.

    The ironic thing is that, in my capacity as Secretary, I called an SGM for 1 September to attempt to resolve the matter once and for all (for a decision on both the committee and the Manager). On the day of the SGM the teleconference provider advised that the meeting ID had been changed so I had to cancel the meeting. Talk about a twist of fate… both the Chair (P) and the Manager are, unsurprisingly yet frustratingly, in no hurry to convene the AGM yet happy to have a ‘committee’ meeting. It makes no sense.

    The scary thing is that I have already mentioned most of what Jimmy T outlined below to both the Manager and the Chair and it hasn’t had any impact whatsoever. The situation has become somewhat uncomfortable and there’s seemingly not much that can be done about it.<span class=”Apple-converted-space”> </span>

    The Manager has confirmed that R did not submit a proxy form for the AGM. There is no doubt that R was not present (either in person or via proxy) and did not nominate for the committee. I have pressed the Manager previously regarding how it’s possible that R was appointed a committee member per s.103(4) and (5) yet the Manager refuses to answer the question directly, simply stating that it’s what was agreed to at the meeting.<span class=”Apple-converted-space”> </span>

    R has been somewhat absent in general. We have asked R to confirm whether they feel they are a committee member – no response. They have confirmed they’ll attend the ‘committee’ meeting though.

    I have mentioned s.122 to the Manager and repeatedly asked for clarification about the committee membership (amongst other things). The responses I’ve received have instead targeted my character and not once addressed the questions at hand. The Manager cannot be reasoned with so unfortunately it’s well past the point of a quiet word!

    In my opinion the Chair (P) is a key contributor to the mess we’re in and there are serious question marks about whether P has met their obligations per s.117 of the Act. You would think that the Chair should’ve been clear on which members formed the committee when providing the Manager with our instructions between November 2019 and June 2020. P seems to understand the gripes that K and I have with the Manager yet objects to their termination for no apparent reason.

    P has conceded that it’s difficult to see how R was validly elected to the committee at the AGM. P has, however, argued that there is doubt as to whether K was actually elected. This ‘doubt’ arises from the conflicting accounts of the meeting (ie. in that myself and K attest that K was elected, and that P’s proxy J and the Manager attest that K was not elected).<span class=”Apple-converted-space”> </span>

    I would have thought that if a majority of owners present at a meeting attest to the accuracy of a particular resolution that it would trump the views of the minority (and definitely the Manager as an administrator only). What are your thoughts on that more broadly? I imagine there are other situations where an important resolution is disputed – how are they resolved?

    I would happily take this matter to VCAT but with the AGM in late October there’s no way I’d get a hearing in time. I am concerned that the Manager will get ‘in the ear’ of the long standing, absent owners (like R) to shut down the termination at the AGM and perhaps even boot me off the committee. Desperate to find a way to fix this prior to then!

    #52047
    Sir HumphreySir Humphrey
    Strataguru

    If R thought they were a committee member, it seems odd that almost a whole year has gone by without R asking when there is going to be a committee meeting.

    So, I wonder why has this become an issue all of a sudden? The financial year has just ended and an AGM is imminent. At that AGM, the current committee ends, whether that included R or not, and a new committee will be elected.  R may or may not nominate and be elected to that new committee. What is the rush to have R on the committee now when R’s legitimacy could be put beyond doubt with the formation of a new committee in only a few weeks time?

    However, as a courtesy, why not allow R to attend the pre-AGM committee meeting as a non-voting observer?

    Unless there is some Machievellian plot to push or block something at the committee meeting before the AGM, I wouldn’t waste energy on a matter that will become irrelevant in a few weeks.

    #52045
    AvatarAustman
    Flatchatter

    I agree with Jimmy-T.  R could not possibly be a committee member unless:

    – they or their proxy attended the AGM or

    – they were nominated prior to the AGM, in writing.

    That should all be documented.

    What does R even say about it?

    As secretary, you could call a Special General Meeting to resolve the issue.   That’s always your option.  It would be unfortunate if P or the Manager forced you to do that.

    #52041
    Jimmy-TJimmy-T
    Keymaster

    I feel this is only “complicated” by the refusal of certain parties to accept what is clear-cut in the legislation. The assertion that there was “no change” flies in the face of Section 103 (5) of the Owners Corporation Act which says this:

    (5) Subject to this Act and the regulations, the members of the committee hold office from their
    election until a new committee is elected

    As an aside, subsection 4 says this:

    A lot owner or a proxy for a lot owner may nominate for election as a member of the committee—
    (a) in writing; or
    (b) orally if the lot owner is present at the annual general meeting.

    So R’s membership of the committee ended when the new committee was elected – that applies to all concerned – but they aren’t part of the new committee because, according to your notes, they neither nominated in writing nor were present to nominate themselves orally. If they had nominated in writing , there should be evidence of that

    Now, there’s a chance that either J or the manager were acting as proxies for R but that would only be valid if there was an official proxy form stating that. Here’s another section of the Act you might want to address:

    122 Duties of manager
    (1) A manager—
    (a) must act honestly and in good faith in the performance of the manager’s functions; and
    (b) must exercise due care and diligence in the performance of the manager’s functions; and
    (c) must not make improper use of the manager’s position to gain, directly or indirectly, an advantage personally or for any other person.

    On the face of it, you could argue that the manager has fallen down on both (b) and (c).

    If I were you, I would have quiet word with the manager and explain that it would be best for all concerned if they went quietly before their reputation is tarnished by action at CAV and VCAT not to mention a full and detailed report at the next AGM.

    Speaking generally, for any OC committee to conduct a meeting, in which someone who was not a member of the committee was allowed to vote, would be illegal. For any strata manager to engineer this in order to protect their position, would be both immoral and illegal.

    There may be aspects of Victoria strata law covering this of which I am not aware, but this looks like a snafu for which your manager is largely responsible and they should bear the consequences of that, whatever they may be.

    Strata managers’ most fundamental role is to help committees and communities run smoothly.  When they fail to address problems properly, according to the law, then they become part of the problem rather than the solution.

     

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