The amendments to the Strata Titles Act 1985 (WA) (Act) in force from 1 May 2020 removed the definitions of Resolution Without Dissent and Unanimous Resolution from section 3C of the Act and created, amongst other things, new provisions governing:
- quorums at General Meetings; and
- the types of resolutions a Strata Company can pass,
each affecting the “ease” with which a Strata Company can pass Resolutions Without Dissent and Special Resolutions.
Quorums at General Meetings
The Act stipulates that no business can be transacted at a General Meeting of a Strata Company unless a quorum is present at the time the General Meeting “proceeds to business”.
Therefore, a Strata Company must achieve a quorum at a General Meeting before it can transact any “business” including “business” required by the Act. For example, the setting of a budget.
A quorum is constituted for 2 Lot Schemes if all persons who are entitled to cast the vote attached to each Lot (100%) are present.
For Schemes other than 2 Lot Schemes, a quorum for General Meetings is constituted when persons who are entitled to cast the votes attached to 50% of the lots in the Scheme are present at the General Meeting.
However, if not enough people to satisfy the quorum requirements are present at the General Meeting of a Strata Company (other than a 2 Lot Scheme) at its scheduled start time, after 30 minutes has elapsed from the appointed start time of the General Meeting, the persons entitled to vote who are then present at the General Meeting constitute a quorum for the purposes of that General Meeting.
When establishing a quorum for a General Meeting the Chairperson of the Meeting must count as part of the quorum any person who is a proxy holder for a person entitled to vote at the General Meeting.
Requirements for Resolutions without Dissent
Resolutions Without Dissent occur if:
- notice of the proposed resolution is given to each Owner within the Strata Company at least 14 days before voting on the resolution “opens”;
- no vote is cast against the resolution during the relevant General Meeting;
- Owners who were not present at the General Meeting at which the resolution was voted on, either in person or by proxy, receive written notice of the outcome of the vote on that resolution; and
- no vote is cast against the resolution during the 28 days after the General Meeting at which the Resolution Without Dissent was presented, unless the Strata Titles Regulations 2019 (WA) specify otherwise.
Requirements for Special Resolutions
Special Resolutions of a Strata Company must satisfy the same criteria as Resolutions Without Dissent as above set out but have additional specific criteria based on the size of the Scheme.
In a 2 Lot Scheme, a Special Resolution is only passed if both Lots vote in favour of the Resolution.
For 3 to 5 Lot Schemes to pass a Special Resolution the Lots that vote in favour of the Resolution must hold at least 50% of the Unit Entitlements in the Scheme and:
- in a 3 Lot Scheme at least 2 Lots must vote in favour of the resolution;
- in a 4 Lot Scheme at least 3 Lots must vote in favour of the resolution; and
- in a 5 Lot Scheme at least 4 Lots must vote in favour of the resolution.
In Schemes with more than 5 Lots, at least 50% of the Lots in the Scheme must vote in favour of the resolution and less than 25% of both the number of Lots and the aggregate Unit Entitlements in the Scheme must vote against the resolution.
Owners that owe money to the Strata Company under the Act cannot vote on resolutions of a Strata Company at a General Meeting except for Unanimous Resolutions, Resolutions Without Dissent and certain resolutions about “Leasehold Schemes” or “Termination Resolutions”. Therefore, such indebted Owners cannot be counted for quorum purposes at a General Meeting for the purpose of “Ordinary Resolutions” or certain “Special Resolutions”.
The Act sets out the basis of how Owners can become indebted to the Strata Company (which is different from “the old”).
The information published in this article is of a general nature and should not be construed as legal advice. Whilst we aim to provide timely, relevant and accurate information, the law may change and circumstances may differ. You should not therefore act in reliance on it without first obtaining specific legal advice.
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