Advice and Opinion

Trustee nominations and elections

The time of year has come again, where AGMs in sectional title schemes are being held and the trustee’s terms would have come to and end. Nominations and elections will be held but it is sometimes very difficult to motivate owners to make themselves available as trustees, says Michael Bauer, general manager of IHFM, the property management company.

The work that they have to do is often time consuming and although they can be reimbursed for their expenses incurred, they cannot be paid for the hours that they put in unless the owners agree and pass a special resolution to this effect.

It sometimes seems that the nomination and election process is complicated. Bauer explains that when owners are nominating new trustees, Prescribed Management Rule 7 stipulates that owners must put these nominations in writing and this, with the written consent of the nominee, must be handed in at least 48 hours before the AGM or any other general meeting.

Occasionally, there aren’t enough nominations and in this case further nominations can be taken from the floor at the meeting, but this too must be with the nominee’s consent.

The number of trustees is only decided at the AGM and cannot be less than two, said Bauer, and it is usually not clear whether there will be enough nominations to fill the required number until after this decision has been made, which does complicate matters.

PMR 5 requires that the majority of trustees must be owners or spouses of owners, and if the nominations received are more non-owners than owners, then further nominations might have to be called for at the AGM, in order to comply with this rule, said Bauer.

If there is a shortage of nominations once the meeting has taken place, then further nominations will be asked for at the meeting.

Once all the nominations have been given then voting will take place and the votes tallied. The chairperson will then check how many candidates are owners as opposed to non-owners. If the number of non-owners outweighs the owner number then the non-owner trustee with the least amount of votes must be eliminated and the voting process is repeated until the correct owner ratio of trustees is reached.

“We always ask that owners take interest in their scheme and get involved. Allowing yourself to be nominated and elected as a trustee is one way of helping maintain the standards of the management and financial control and getting the necessary work done,” said Bauer.

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