Irish Times Property Clinic Thursday the 29th day of May 2014
Publishing Date; Thursday the 29th day of May 2014.
Q I live in a multi-unit development of about 300 apartments. It is well run with adequate capital funding. The downside is that few turn up for the agm. My concern is that motions, mainly for potential changes to house rules, could be passed by a small attendance. This has not happened to date but a certain level of non-compliance with the house rules appears to be creeping in.
What are your views on the need for quorums – I appreciate that too high a bar impinges on decision-making. Also, should it come up, how can changes to house rules, which are effectively our constitution, be effected to make them representative of the majority.
A. The requirement for a company to have a quorum is bound by the articles of association of an owners' management company (OMC) as well as company law. If you refer to your OMC's articles of association it should indicate the minimum number of members required to be present. Almost all company information is now available from the Companies Registration Office for a small fee. The CRO website allows you search for your company and purchase the documents.
If the information is not available, section 318 of the Companies Act 2006 is the reference in law for quorums. Based on the Multi-Unit Developments Act 2011 (MUDs Act 2011), your OMC would require a minimum of two members to attend the meeting to qualify for a quorum. It is generally the case that if the development is running smoothly, many people choose not to attend the agm as they do not have a grievance to air.
There is no mechanism to compel members to attend an agm; members of an OMC may choose not to attend. I fully appreciate that poor attendance at an agm is unhelpful in the management of developments and onerous for directors who have given their free time with little or no recognition of their efforts.
Under section 23 of the MUDs Act 2011, the OMC must provide a draft of the proposed house rules to its members no less than 21 days in advance of the agm. The members will consider and accept or reject the house rules at the meeting and thereafter they are binding provided the house rules are consistent with that which is set out in section 23 of the Act.
If the OMC had the resources, it might be a worthwhile exercise to provide a return stamped addressed envelope to members with the proxy vote on the issue so as to entice the members to participate. It would be helpful to note the cost of doing so in response to the poor attendance historically so the members can see the financial cost of their absence.
Paul Huberman is a member of the property and facilities management professional group of the Society of Chartered Surveyors Ireland,
Author: Paul Huberman of H&H Property Management Consultants Ltd
Publish Date: 29/05/2014