Property News

Q&A – 2020 03

By the Paddocks Club team

Below are examples of two questions on the Paddocks Club discussion forum, to show you what is available to our Community members!

Trustees wish to delay the annual general meeting due to COVID-19

Member’s question:

Good day Paddocks,

As we are all aware, with the worldwide and nationwide spread of the coronavirus (COVID-19), yesterday, the president declared a national disaster.

The trustees of a particular sectional title scheme feel that it is necessary to delay the annual general meeting, where the notices have already been circulated.

The Sectional Title Schemes Management Act does not allow for this, but these circumstances are abnormal. Can you advise of any known mechanisms, with a national disaster in mind, that may allow for this?

Thank you.

Graham’s answer:

Dear member,

Health is a priority in these abnormal circumstances. Particularly in a scheme that includes older people, I agree that the trustees need to “think laterally”.

The first question that they need to consider is whether or not they wish to proceed with a physical meeting at all. The Prescribed Management Rules do make provision for remote attendance and avoiding an annual general meeting entirely:

  • If they could arrange for people to attend remotely (using Skype / Zoom / WhatsApp…) then they should investigate this possibility. See Prescribed Management Rule 17(10). Their decision would have to take into account the capacity of the owners in the particular scheme to use whatever technology is required.
  • If all owners will agree on all the resolutions in writing, no physical meeting is required. See Prescribed Management Rule 17(9).

If the trustees decide there is no reasonable alternative to a physical meeting, in the current circumstances I believe they would be justified in taking a decision that they are going to postpone/delay the annual general meeting. This should be done by way of a proper trustee resolution. And perhaps they should also make a side note to get the body corporate to make a management rule allowing them to postpone meetings in future when they consider that this is really necessary.

It would be sensible, before making such a decision, to get an assurance from their managing agent or accountant that this will not seriously prejudice the body corporate. If it will, they should take whatever action is required to mitigate the potential prejudice.

Having decided to postpone the annual general meeting, the trustees must notify all persons entitled to attend the annual general meeting, perhaps asking people to confirm that they have received the notification.

Regards,

Graham

Trustee harassing/insulting an owner – What should we do?

Member’s question:

Good day Paddocks,

A nasty email was sent from a trustee to an owner (verbal insults). The owner has forwarded the email to the other trustees and MA asking for intervention and removal of the trustee.

As its a long standing feud, my opinion is that it’s personal, but as this involves a trustee, what do you think should be done, if anything?

Thank you.

Graham’s answer:

Dear member,

The other trustees must decide, on the basis of this email and any other relevant behaviour, whether or not this trustee needs to be removed from office.

  1. If so, they can ask him/her to resign. If the trustee they think should resign will not, they can call a meeting to have owners remove him/her. Alternatively they can wait for the annual general meeting and do their best to make sure s/he is not re-elected.
  2. If they don’t think the trustee should resign, they should arrange/instruct this trustee to have no further direct contact with this owner, and tell the owner of the arrangement, to prevent the trustee using that position to wage a personal feud / advance a personal agenda.

Regards,

Graham


Article reference: Paddocks Press: Volume 15, Issue 02.

Graham Paddock is available to answer questions on the Paddocks Club discussion forum for Community members. Get all your questions answered by joining Paddocks Club.

This article is published under the Creative Commons Attribution license.

Back to Paddocks Press – February 2020 Edition.

Source: https://www.paddocks.co.za/paddocks-press-newsletter/qa-2020-03/