Advice and Opinion

Trustee changes in sectional title schemes

Sometimes there are errors in judgement made by the current trustees in a sectional title scheme, or there may be disagreements about the running of the scheme and the owners want to drive changes by nominating others to step in.

Trustee nominations and elections can be problematic enough in sectional title schemes, but it becomes even worse when owners elect proxies to attend the annual general meeting or a special general meeting on their behalf to put in a vote to elect a specific person that they want as a trustee, and the proxies don’t attend the meeting, said Michael Bauer, general manager of the property management company IHFM.

There are two types of proxies, an open proxy and a directive one, said Bauer. Usually an owner appointing a proxy to attend a meeting on his behalf would stipulate on the proxy form whether he is giving a specific instruction to that proxy on how to vote at the meeting, but if he doesn’t, the proxy can then vote in whichever way he chooses.

Many people do not realise that if the proxies do not attend the meeting that their vote then automatically cedes to the chairman, who can then end up with the majority vote in favour of the decision he wants to make.

When there is a contended election of trustees, and owners want a specific person to be voted in, it is of utmost importance to attend the AGM and vote and not leave it in the hands of a proxy, said Bauer.

“They don’t have the vested interest in the scheme to think about, whereas you as the owner need to think about the positive future of your scheme.”

“If major changes need to be made then it is also important to back up the canvassing for change with the option of putting yourself forward as a trustee,” said Bauer.

It often happens that many people in sectional title schemes need changes made to the management or running of various aspects in the scheme but they do not want to get directly involved, which shouldn’t be the case.

To make changes in any sectional title scheme, it requires some of the owners to step up and drive the necessary changes. They can make use of the rules given to them to do so (the Prescribed Management Rules), and it can be done easily by being prepared beforehand.

When attending the AGM, be sure that there are enough nominees, have the required paperwork completed and if there are proxies, be sure that their forms have been completed correctly and that they are present, he said.

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