Information Sheet: Body Corporate Meetings

Why does the body corporate hold meetings?

A body corporate holds meetings to discuss and make decisions about matters affecting the unit title development, such as levies, insurance and repairs.

Meetings of the body corporate are either an annual general meeting (AGM) or an extraordinary general meeting (EGM).

How often must the body corporate meet?

A body corporate must hold an AGM at least once during a calendar year, and within 15 months of the previous meeting. A new unit title development must hold its first AGM within 6 months of the later of the date that the unit title subdivision takes place or the sale of the first unit is settled.

A body corporate can also hold EGMs. An EGM can be held at any time throughout the year to consider any matter relating to the unit title development. For example, the body corporate chairperson or committee might need to get agreement from the body corporate to undertake repairs.

What happens at an annual general meeting?

At an AGM the body corporate must elect:

• a body corporate chairperson
• body corporate committee members (if there is a committee)
• a subsidiary body corporate representative (if the development is a subsidiary unit title development).

The body corporate might also pass resolutions to do other things, for example upgrade facilities in the unit title development or renew a service contract.

The following matters are some examples of what may be discussed at the AGM:

• the financial statements for the year
• maintenance of the common property
• insurance
• other expenditure
• any service contracts.

How is an annual general meeting called?

The chairperson must first send out a notice of intention to hold an AGM to each of the body corporate members. The chairperson will then send a notice of AGM. If it is the first AGM for the unit development the body corporate will issue these notices.

A notice of intention to hold an AGM will tell members when and where the meeting will be held, invite nominations for elections and invite unit owners to propose discussion matters for the AGM. It must also remind owners they may not vote unless any levies or other amounts they owe to the body corporate have been paid.

A notice of intention to hold an AGM must be sent at least three weeks before the date of the meeting, or six weeks before if the development is a parent unit title development.

The notice of AGM will contain the agenda, as well as the text of any motions to be decided on by resolution and the names of candidates for election. The notice must also state procedures for voting by proxy or post and what happens if a quorum is not present. The notice of AGM will include a proxy form, postal voting form and copy of the recent year’s financial statements. It may include any other documents the chairperson thinks are relevant to help members participate in the discussion and cast an informed vote.

The notice of AGM must be sent at least two weeks before the AGM or three weeks before if the development is the parent unit title development

How is an extraordinary general meeting called?

An EGM may be called by the chairperson or the body corporate committee (if there is one), and must be called by the chairperson if at least 25% of unit owners request it.

A notice of intention to hold an EGM only has to be issued if the purpose of calling the EGM is to hold an election (if the chairperson, a committee member or the subsidiary body corporate representative has resigned or is removed). In that case, the notice of intention must be issued two weeks before the meeting, or four weeks if the development is a parent unit title development.

A notice of EGM has to be issued any time an EGM is called and must be issued one week before the meeting.

EGMs can be called in emergency situations without following usual notice periods, provided the chairperson or body corporate makes reasonable effort to notify every unit owner of the meeting.

Quorum

Most decisions at a meeting of the body corporate are discussed and then made by voting on resolutions.

Before any business item on the agenda can be resolved a quorum of eligible voters, or their proxies, need to be present. A quorum is the minimum number of members necessary to conduct business. In the case of a body corporate meeting, the quorum is the people who can vote on behalf of at least 25% of the principal units.

However, a meeting can proceed without a quorum present if the people who have cast postal votes together with those actually present at the meeting represent the voting power of at least 25% of the principal units.

If the body corporate has two or more members, the quorum must always be at least two members.

What if there is no quorum?

If the meeting can’t proceed because there is no quorum and there aren’t enough postal votes for 25% of the voting power to be represented, the meeting is adjourned to the same day, time and place one week later, or a changed time and place that the chairperson notifies to all unit owners. The reconvened meeting must proceed, whether or not the 25% threshold is reached.

What if you can’t attend a scheduled meeting?

If you can’t attend the meeting you can vote by proxy or by post. Forms for these are sent out with the notice of meeting.

A proxy is a person representing the eligible voter for a particular meeting, and who attends the meeting on their behalf. The proxy must be appointed by the eligible voter on a proxy form. The proxy appointment will not be effective until the form is delivered at the meeting in the manner required by the body corporate.

Postal voting forms will be included with the notice of the meeting. Postal votes will not count towards a motion that is materially amended at the meeting. Those postal votes will still count towards the threshold for the meeting proceeding without a quorum.

Proxy and postal voting forms are prescribed under the Unit Titles Regulations 2011.

Resolutions

There are two types of body corporate resolution: a special resolution and an ordinary resolution.

A special resolution means at least 75% of eligible voters who vote have to agree to the motion for it to be passed. This type of resolution is used if the body corporate has to decide how to exercise one of its duties or powers which can’t be, or hasn’t been, delegated to the body corporate committee (for example, if the body corporate wants to reassess the method of apportionment of utility interests). In addition, a special resolution is used for decisions where it is specifically required by the Act (for example, where the body corporate grants a lease over the common property).

An ordinary resolution means a majority of eligible voters who vote have to agree to the motion for it to be passed. This type of resolution is used for all other kinds of decisions and if the body corporate wants to change the development’s operational rules [link to fact sheet on body corporate operational rules].

When votes are being counted they cannot be rounded up. For example if a development has 10 principal units and owners of 7 principal units vote and:

• a special resolution is required then 75% of 7 votes is needed, which equals 5.25 votes. For a special resolution to be passed the owners of at least 6 units must vote in favour
• an ordinary resolution is required then a majority of 7 votes is needed, meaning more than 3.5 votes.

For an ordinary resolution to be passed the owners of at least 4 units must vote in favour.

Who can vote?

You can vote if you are aged 16 years or older, and:

• you are recorded on the body corporate register as the owner of a principal unit or their authorised representative, or
• you are the nominee (for a company) or proxy of that registered owner or their representative; or
• you are a subsidiary body corporate representative

You will not be entitled to vote if you have unpaid levies due to the body corporate for your unit.

Regardless of whether the matter requires a special resolution or an ordinary resolution, or whether a poll is requested, only one vote may be exercised for each principal unit. Even if you jointly own a principal unit with someone else, you only have one vote between you.

How does a subsidiary body corporate vote at a parent body corporate meeting?

A subsidiary body corporate must elect a subsidiary body corporate representative by ordinary resolution at every annual general meeting of the subsidiary body corporate.

When a subsidiary body corporate receives a notice of a general meeting from its parent body corporate, the chairperson of the subsidiary body corporate needs to call a general meeting.

The subsidiary body corporate will consider the parent body corporate agenda and decide how their representative will represent it at the meeting.

The subsidiary body corporate representative may only vote on a matter being decided at a parent body corporate meeting if it has been directed to do so by the subsidiary body corporate. The representative must abstain from voting at the parent body corporate meeting if it does not receive any directions on the matter.

What if I don’t agree with the result of a vote?

When a resolution has been voted on, a person who is at the meeting and who voted on the matter can request a poll to be taken. If a poll is requested, the votes are re-counted according to ownership interest. This means that each vote is weighted according to each voter’s ownership interest and a person with a larger ownership interest will have more of a say than a person with a smaller ownership interest. The result of the poll then becomes the result of the resolution on that matter.

Alternatively, any person who votes against a resolution that is passed can apply for relief on grounds the resolution is unjust or inequitable for the minority. This type of application must be made within 28 days of the resolution being passed.

Any person voting for a special resolution that is not passed but received at least 65% voting support can apply to have the resolution confirmed on the grounds that the effect of it not being passed would be unjust or inequitable on the majority.

Some resolutions concern specific matters relating to key individual and common property rights. These resolutions are also known as designated resolutions. Unit owners and others with an interest in the development have the right to object to these kinds of resolutions. See the information sheet “Body corporate designated resolutions” for more information.

See the information sheet “Dispute resolution in a unit title development” for more information about resolving disputes.

What about general business not on the agenda?

Usually only matters that are on the agenda and have been sent out to unit owners in advance can be voted on at general meetings of a body corporate.

However, the body corporate can vote on a matter that was not on the agenda if all eligible voters are present at the meeting. If not all eligible voters are present, those who are in attendance can still discuss the matter, and it may be included on the agenda for the next meeting.

Does the body corporate have to meet in person to pass a resolution?

Resolutions can be made without having to meet in person. The chairperson will send out a notice to all eligible voters that contain details of the resolution and explains that the resolution will be voted on without a meeting. For the resolution to pass, it must be signed by at least 75% of all eligible voters (if a special resolution is required) or at least 50% of all eligible voters (if an ordinary resolution is required).

The body corporate committee

The body corporate can delegate some of its duties and powers to a committee by passing a special resolution and then issuing a notice of delegation to each member of the committee.

The notice of delegation must:

• contain a description of the duty or power and any restrictions on the body corporate committee’s power to perform the duty or exercise the power
• specify the duration of the delegation
• contain a statement that the notice of delegation is evidence of the body corporate committee’s authority to perform each duty or exercise each power that is being delegated
• specify the frequency of the body corporate committee’s reports on the delegation to the body corporate.

The committee must meet within a month of receiving the notice of delegation and then as often as it considers necessary. The committee decides on any matters under its delegated duties and powers by a simple majority of votes.

The committee has to report to the body corporate. The report must include a description of the duties or powers that have been delegated to the body corporate committee during the period covered by the report; and an update on the fulfilment of those duties or the exercise of those powers by the committee.

If a unit title development has 10 or more principal units the body corporate must form a body corporate committee, unless it decides not to by special resolution. A body corporate of less than 10 units may decide to form a committee.

Where can I find more information?

For Unit Titles advice and information call 0800 UNIT TITLE (0800 86 48 84), visit the Unit title developments section of our website or email us at info@dbh.govt.nz