Governance of the Strata Corporation (22:VI): Difference between revisions

The strata corporation operates through the strata council (''SPA'', s 4) and has the power and capacity of a natural person of full capacity (''SPA'', s 2(2)). Where the ''SPA'' references “the strata corporation,” it is referring to decisions of the strata council that exercise the strata corporation’s powers. The strata council is responsible for exercising the powers and performing the duties of the strata corporations, including enforcing the bylaws (''SPA'', s 26), and conducts business of the strata corporation subject to directions from the owners of the strata lots.

Under section 4, the powers and duties of a strata corporation must be exercised by the strata council except where the ''SPA'', the ''SPR'', or the strata corporation’s bylaws provide otherwise.

* Managing, maintaining, and repairing common property (s 3);

* Convening annual general meetings (s 40) and special general meetings in response to owner demands (s 43);

* Maintaining strata corporation and section records (s 35) and making them available (s 36); and

The strata council must continuously decide whether they have jurisdiction over matters. Many sections of the ''SPA'' require approval only if certain criteria are met, like making “significant changes” (s 71), or whether an immediate expenditure is “necessary to ensure safety” (s 98(3)). In cases like these, the strata council may need legal counsel to give guidance over whether the strata council has jurisdiction.

# Charging interest on arrears (s 107);

# Taking collection proceedings against an owner in Small Claims Court (s 171(4)).

Under section 31 of the ''SPA'', strata council members are required to act honestly and in good faith with a view to the best interests of the strata corporation. Acting in good faith, under Standard Bylaw 22, relieves a council member of liability for anything done in the performance of their duties.

In [https://www.canlii.org/en/bc/bcsc/doc/2021/2021bcsc1752/2021bcsc1752.html ''Rochette v Bradburn'', 2021 BCSC 1752] at para 83, the court clarified that section 31 does not create a standalone right for a strata owner to sue a strata council over breaches of its standard of care. While section 31 does inform the standard of conduct from sections 32 and 33, a court action still must satisfy the requirements from section 33: a strata council member failing to adequately discharge their duty to disclose conflicts of interest, and the remaining owners failing to ratify the affected decision. The duty of care is ultimately owed to the strata corporation as a whole, meaning that the strata corporation itself would have standing to sue a strata council member under section 31.

Section 28 states that the only persons who may be council members are owners, individuals representing corporate owners, and tenants who have been assigned a landlord’s right to stand for council under sections 147 or 148. Bylaws can be made, however, to permit others to sit on the strata council, although [https://www.canlii.org/en/bc/bccrt/doc/2022/2022bccrt857/2022bccrt857.html ''Paget v Strata Plan LMS 1951'', 2021 BCSC 2111] held that a person acting under the authority of a power of attorney cannot sit as a member of a strata council.

The issue raised from naming all nominees to council is that someone could be elected to council despite opposition from a majority of the owners. This could be addressed by a bylaw amendment mandating that the number of council members may range from three to seven, as fixed from time to time by majority vote resolution at a general meeting, or a bylaw amendment mandating a specific form of balloting. Both methods could be subject to challenge under section 164 if it is a departure from the established norm.

Section 50(1) of the ''SPA'' requires decisions at general meetings to be made by majority vote. This does not include elections by acclamation, as decided by the court in [https://www.canlii.org/en/bc/bcsc/doc/2016/2016bcsc2147/2016bcsc2147.html ''Yang v Re/Max Commercial Realty Associates (482258 BC Ltd.)'', 2016 BCSC 2147] [''Yang''], although the court also said that it was still better practice to still require a vote unless a majority of the owners approve a resolution to have the election proceed by acclamation.

Standard Bylaw 11 provides that, unless all strata lot owners are on the strata council, one or more council members can be removed by a majority vote at a general meeting, although some strata corporations may pass bylaws requiring a higher threshold. The CRT in [https://www.canlii.org/en/bc/bccrt/doc/2022/2022bccrt831/2022bccrt831.html ''Wong’s Insurance Services Ltd. v The Owners, Strata Plan LMS 3259'', 2022 BCCRT 831] held that there is a reasonable expectation that a strata council would provide to owners reasons for removal based on true facts.

Section 34 of the ''SPA'' provides that any remuneration paid to a member of council for the member’s exercise of council powers of performance of council duties must be approved in advance of payment in the budget, in the bylaws, or by a resolution passed by a ¾ vote at an annual general meeting.

Section 2 provides that a strata corporation has the power and capacity of a natural person of full capacity, subject to any limitation under the ''SPA'' or ''SPR''. Section 38(a) clarifies the strata corporation’s ability to enter contracts, providing that it may enter into contracts in respect of its powers and duties under the ''SPA'', the ''SPR'', and the bylaws.

Section 38(b) also clarifies section 2 by proving that a strata corporation may join organizations to further its purposes under the ''SPA'', the ''SPR'', and its bylaws.

The first annual general meeting of a strata corporation is convened by the owner developer within a specified period following either the first conveyance or conveyance of 50 per cent plus one of the strata lots. Then, the strata council is responsible for holding annual general meetings within two months following each fiscal year-end (s 40).

A special general meeting is any general meeting that is not an annual general meeting. It can be convened at any time by the strata council (s 42) or demanded by the strata lot owners (s 43). These are usually called to deal with a special levy, a contingency reserve fund expenditure, or a litigation matter.

Standard Bylaw 25 provides that the president chairs a general meeting of the strata corporation; in the absence of the president, the vice president may chair a meeting. In absence of both, a chair selected by the voters at the meeting. It should be noted if a third party is selected that the president and vice president both declined to chair.

Sections 45 states that at least two weeks’ written notice of a general meeting must be given to:

# Tenants who have been assigned the right to vote under sections 147 and 148;

# Mortgagees who have requested notifications of meetings under section 60.

The wording “at least two weeks” means at least 15 days as per the [https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/96238_01 ''Interpretation Act'', R.S.B.C. 1996, c. 238, s 25.2(3)]. Section 61(3) of the ''SPA'' says that, for methods of service other than direct personal service, the deemed date of service is four days after it has been delivered. This includes email service. As a result, the required notice for general meetings could be up to 20 days in advance. Importantly, if the required notice was not provided, any business done during the general meeting can be invalidated.  

Section 45(2) permits that any person entitled to be notified can waive notice by a written notice, though such a waiver is revocable.

Section 61(1) provides how notice can be given to a strata lot owner or tenant entitled to notice. Section 61(1)(b) provides that if the strata lot owner or tenant has not given an address outside the strata plan for notice, it can be hand delivered, put under the door, mailed, put through a mailbox, faxed to a number provided by the person, or emailed to an address provided by the person.

Section 61(1)(a) provides that if the strata lot owner or tenant has given an address outside the strata plan, only personal service or mail delivery are permitted. [https://www.canlii.org/en/bc/bcsc/doc/2009/2009bcsc506/2009bcsc506.html ''Azura Management (Kelowna) Corp. v Owners of the Strata Plan KAS 2428'', 2009 BCSC 506] [''Azura Management''] includes email delivery as part of the “mail” delivery requirement in 61(1)(a), going against the [https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/96238_01 ''Interpretation Act''], which defines “mailing” as sending prepaid through the Canada Post Office.

Notice of an annual or special general meeting must include (s 45(3)):

This provision must be strictly adhered to, as the BCSC declared a bylaw amendment voted on at a general meeting to be void because the bylaw amendment was not included in the notice before the meeting in [https://www.canlii.org/en/bc/bcsc/doc/1994/1994canlii1412/1994canlii1412.html ''453881 BC Ltd. v Strata Plan Lms508 (Owners)'', 1994 CanLII 1412 (BC SC)]. However, the court held in ''Azura Management'' that a ¾ vote approval had been approved despite not being referred to in the notice, so the current strength of section 45(3) is unclear.

Section 46(1) provides that the strata council determines the agenda for a general meeting unless a resolution is proposed by a demand of owners under section 46(2) or the meeting is demanded and called by voters under s. 43.

A general meeting notice must include a description of the matters that will be voted on (s 45(3)). This requirement makes it clear than any resolution requiring a ¾ vote, 80% vote, or unanimous approval must be included in the meeting notice and cannot be raised from the floor. [https://www.canlii.org/en/bc/bcsc/doc/2001/2001bcsc1602/2001bcsc1602.html ''Leung v Strata Corporation LMS 2835'', 2001 BCSC 1602] confirms this, as a council member was removed from his position during a heated debate at a general meeting, and the courts determined that the member should be reinstated. Only minor changes are permitted from the floor, such as fixing typos and other small errors.

It is not clear if matters that require only majority vote approval are permitted from the floor. It may be the case that if a resolution from the floor directing the strata council under section 27, that is to control their own powers, is related to an item of business included in the meeting notice, the resolution may be able to stand if it is amended to only require majority vote approval.

Owners in a strata corporation can propose a resolution or raise a matter under section 46(3) or demand a general meeting to consider a resolution or matter under section 43 if the proposal/demand is signed by persons holding at least 20% of the strata corporation’s votes. The owner is restricted from signing as part of the 20% if the strata corporation has a bylaw suspending the vote for a strata lot if the strata corporation is entitled to a lien.

Section 63(1) of the ''SPA'' provides the requirements for delivering a demand to a strata corporation. The demand can be:

A section 46 demand proposing a resolution or raising matter must be complied with at the next general meeting, whether that be annual or general.

A section 43 demand compels the strata council to hold a special general meeting to consider the matter or resolution four weeks after the demand is given. If this is not complied with, the persons who signed the demand can set a special general meeting themselves held under the applicable provisions of the ''SPA'' and the bylaws.

Section 56 permits strata lot owners, tenants, and mortgagees entitled to vote at a general meeting to do so by proxy, where the proxy:

* Proxies are not ballots, so they should not be drafted with “check boxes” for various resolutions (see [https://www.canlii.org/en/bc/bccrt/doc/2021/2021bccrt504/2021bccrt504.html ''Curll v The Owners, Strata Plan NW2926'', 2021 BCCRT 504]);

Section 49 of the ''SPA'' permits attendance at a general meeting to be done electronically by speakerphone, telephone conference, video conference, and web conference, as long as:

* The notice or the meeting given under section 45 includes instructions for attending by electronic means;

An eligible voter attending by electronic means does not need a voting card and is not required or entitled to vote by secret ballot (section 49(3)).

Unless specified differently in the strata corporation bylaws, section 48 provides that a quorum for a general meeting is one-third of the votes, except where there are fewer than four strata lots or strata lot owners, in which case quorum is two-thirds.

Unless specified differently in the strata corporation bylaws, section 48(3) provides that if there is no quorum within 30 minutes after the time specified in the meeting notice, the meeting is adjourned to the same day in the next week at the same place and time, if applicable. If, on that day, there is no quorum within 30 minutes after the specified time, the eligible voters then present constitute a quorum.

Under, section 51(9), a meeting convened under section 51 for the purpose of reconsidering a ¾ vote resolution is cancelled if it does not have a quorum within 30 minutes of the specified time. No bylaw can override this provision.

Voters at a general meeting are all “eligible voters”, defined in section 1(1) as all persons who may vote under sections 53 to 58:

# By default under section 54, the registered owners of all strata lots, each with the voting power set out in the schedule of voting rights, if any, filed in the Land Title Office unless someone else is entitled to vote with respect to that strata lot as set out below;

# Tenants who have the right to vote under section 147 or 148;

# Mortgagees whose mortgages give them the right to vote, if the requirements of sections 54(1)(c) and 60 are met; and

Section 147 provides that a tenant may be assigned a strata lot owner’s right to vote, effective when written notice is given to the strata corporation setting out the tenant’s name and specific details on the duties assigned and time period of assignment. If the tenant is leasing a residential strata for a fixed period of three years or more, the tenant is automatically entitled to exercise the powers of the owner under the ''SPA'' during the lease (s 148), provided the strata corporation receives written notification.

A strata corporation may, under section 53(2), adopt a bylaw to automatically suspend the vote for a strata lot if the strata corporation is entitled to register a lien against that strata lot. In order for the strata corporation to be “entitled to register a lien” under section 116(1), notice must have been given under section 112(2) and at least two weeks must have passed. This excludes the day the notice was sent and the meeting day (s 25 of the ''Interpretation Act''). Delivery rules under section 61 should govern as well.

Section 57 provides that if two or more persons are entitled to vote with respect to a strata lot, only one can vote on a particular matter, and they can change who votes for each respective matter. If they disagree on how to cast their vote on a particular matter, their vote is not counted.

[https://www.canlii.org/en/bc/bccrt/doc/2022/2022bccrt1254/2022bccrt1254.html ''BBR Management Inc. v The Owners, Strata Plan KAS 3359'', 2022 BCCRT 1254] held that the rules provided by section 57 apply where two or more persons share a vote of one, and not where multiple owners share multiple votes.

If a secret ballot is held, a private area must be provided for voters to tender their ballots. If the secrecy of the ballots is not maintained, the vote and resulting resolution may be rendered void ([https://www.canlii.org/en/bc/bcsc/doc/2011/2011bcsc801/2011bcsc801.html ''Imbeau v Owners Strata Plan NW 971'', 2011 BCSC 801]).

“Majority vote” is defined in section 1(1) of the ''SPA'' as a vote in favour of a resolution by more than one-half of the votes cast by eligible voters present in person or by proxy, and who have not abstained from voting. Abstention drops the threshold for passage of a resolution. For example, if 10 voters are present and one abstains, five votes is enough to make a majority vote. Majority vote is the default threshold for decisions at general meetings of a strata corporation (s 50(1)). If the majority vote resolution had 50 per cent support, the president or vice president has a second vote under Standard Bylaw 27.

“¾ vote” is defined in section 1(1) as a vote in favour of a resolution by at least three-quarters of the votes cast by eligible voters present in person or by proxy, and who have not abstained from voting. The same abstention rules of majority votes apply, however, if abstentions result in a ¾ vote being passed with less than 50 per cent of the total votes in the strata corporation, section 51 provides that the vote may be reconsidered at another general meeting. The proposed wording of any ¾ vote resolution must be included in the meeting notice, per section 45(3).

“80% vote” is defined in section 1(1) as a vote in favour by at least 80% of all eligible voters, unlike 80% of those in attendance in person or by proxy for majority vote or ¾ vote. This also means that abstentions and no-shows do not drop the threshold, but instead act as a vote against the resolution. 80% votes are required only in respect of a strata plan cancellation pursuant to section 272 (without a liquidator) or section 277 (with a liquidator). The proposed wording of any 80% vote resolution must be included in the meeting notice, per section 45(3).

Unanimous vote is defined in setion 1(1) of the ''SPA'' as a vote in favour by all votes of eligible voters. Similar to the 80% vote, abstentions do not lower the threshold and instead act as a vote against the resolution. Per section 57(2) of the ''SPA'', if two or more persons are entitled to vote, only one of them still may vote, and that vote must be in favour without a sense of disagreement. The proposed wording of a unanimous vote must be included in the meeting notice, per section 45(3).

There is an exception in section 52 allowing the strata corporation to pass a unanimous vote without getting affirmative votes from all eligible voters. The court can order that a unanimous vote proceed without receiving if votes in favour from all eligible voters if the following conditions are met:

Under sections 41 and 44, the owners in a strata corporation can waive the holding of an annual or special general meeting to pass a unanimous vote via unanimous written consent if the consent resolution is signed by all strata lot owners registered on title or entities assigned the right to vote. This consent resolution can be initiated by any eligible voter, and abstentions and no-shows are counted as votes against the consent resolution.

This is contrary to the requirement of a meeting in the mortgagee notification procedure in section 54(1)(c). To get around this, written consent should be obtained of every mortgagee if the matter is in relation to insurance, maintenance, finance, or other matters affecting the security of the mortgage.

An owner of a strata lot whose vote is suspended for a lienable strata lot maintains its ability to vote on resolutions requiring a unanimous vote (s 53). Section 53 also lists sections in which such strata lot’s vote is not counted, and sections 41 and 44 are not included in that list. It follows, then, that written consent must be obtained from such owners to pass a consent resolution.

Under section 26, strata council business must be conducted in accordance with the ''SPA'', the ''SPR'', and the bylaws.

[https://www.canlii.org/en/bc/bcsc/doc/2009/2009bcsc506/2009bcsc506.html ''Azura Management''] and [https://www.canlii.org/en/bc/bcsc/doc/2016/2016bcsc2147/2016bcsc2147.html ''Yang''] both confirm that meetings can be done over email as long as minutes are provided for them, but the CRT in [https://www.canlii.org/en/bc/bccrt/doc/2019/2019bccrt778/2019bccrt778.html ''Starr v The Owners, Strata Plan EPS 59'', 2019 BCCRT 778] advised that any decisions made during an official meeting over email should be validated and voted on. Absent a bylaw specifically allowing for email meetings, decisions made by email are not valid until they are ratified at a properly convened strata council meeting: see [https://canlii.ca/t/jzfj2 ''Cassey v The Owners, Strata Plan VR326'', 2023 BCCRT 645].  

Under section 34.1 of the ''SPA'', if a strata lot owner requests a hearing at a council meeting in writing stating the reason for the request, the council must hold a meeting within four weeks to hear the applicant. This right cannot be repealed by a bylaw amendment. Within one week of the hearing, the council must provide a written decision (s 34.1(3)).

Under section 169 and 176 of the ''SPA'', a strata lot owner who is adverse to a strata corporation in litigation or arbitration is not entitled to attend those portions of strata council meetings dealing with the litigation.

Section 35 provides that minutes must be taken at every general meeting and every council meeting. Committees of the council and informal discussions among council members need not have minutes taken.

Section 35(1) provides that, at a minimum, minutes must contain any votes taken at a strata council meeting or general meeting. The CRT in [https://www.canlii.org/en/bc/bccrt/doc/2020/2020bccrt161/2020bccrt161.html ''Claridge v The Owners, Strata Plan LMS 223'', 2020 BCCRT 161] found that if a strata corporation includes minutes more detailed than the minimum provided by section 35(1), the minutes must be reasonably accurate so that they do not mislead the owners. However, there is no specific level of detail required beyond stating the results of any votes: see [https://canlii.ca/t/1tggq ''Kayne v The Owners, Strata Plan LMS 2374'', 2007 BCSC 1610] at para 8.

Under section 35, every strata corporation must prepare the following records and retain them for the periods indicated under section 4.1 of the ''SPR'':

# A list of council members with phone numbers and/or emergency contact details under section 4.1(1) of the ''SPR'';

# A list of strata lot owners and tenants, mortgagees who have requested notices of meetings and money owing under section 60, and assignments of voting rights to tenants under sections 147 and 148;

Under section 35, a strata corporation must retain copies of the following, for the periods indicated, under section 35 of the ''SPA'' and section 4.1 of the ''SPR'':

# Common property resolutions under sections 71, 74, and 75 of the ''SPA'' (permanently);

# Waivers of general meeting notices and consents resolutions under sections 41, 44, and 45 (six years);

# Building permit plans obtained from the owner developer under section 20 (permanently);

# Depreciation reports under section 94 (permanently) and any reports respecting maintenance or repair of major items (until the items are disposed of or replaced).

The ''SPA'' does not specify the location at which records must be kept, but the onerous requirements of section 35 make some approaches (like retaining records in the possession of one or more strata council members) riskier than others.

All section 35 records must be available to:

# Tenants who have been assigned an owner’s right to inspect records under sections 147 or 148, and anyone authorized by them in writing;

The strata corporation must comply with requests for access to records within two weeks (s 36) or, if the request if regarding the rules or bylaws, within one week. The CRT has held in [https://www.canlii.org/en/bc/bccrt/doc/2022/2022bccrt681/2022bccrt681.html ''Slack v The Owners, Strata Plan EPS 4413'', 2022 BCCRT 681] that document requests must be reasonable, and it was not reasonable to essentially request to review all records that the strata corporation was required to keep under section 35.

# They may contain information related to litigation that is privileged under section 169 of the ''SPA'';

With respect to information related to litigation that has not yet commenced (such as legal opinions), [https://canlii.ca/t/k38z0 ''Mitchinson v The Owners, Strata Plan VR 1120'', 2024 BCCA 89] held that no provision in the ''SPA'' reaches the high threshold of clear, unequivocal and explicit legislative intent necessary to allow for statutory abrogation of solicitor-client privilege. This means that there is no requirement to disclose legal opinions.

If a strata corporation refuses to give access to information to a person entitled to is under section 36, the person is entitled to seek a court order under section 165 compelling the strata corporation to comply, and likely gain an award of costs. They can also seek an order to provide documents from the CRT.