A Paddocks Sectional Title Lifestyle Blog
By Jennifer Paddock
It’s a question that comes up time and time again – how does a body corporate pass a special resolution properly?
There are SO many misunderstandings around this issue. Even some experienced chairpersons, trustees and managing agents don’t understand this fully, especially the concept of NUMBER AND VALUE. I hope I can shed some light on this for you. Here goes:
Special resolutions can be taken in one of two ways, either without a meeting (ie. in writing by ’round robin’ procedure) or at a general meeting of the body corporate.
By round robin:
At least 75% of the owners (in number and value*) must agree by signing a written or electronic document.
*What do you mean in “number and value”?
Before you can be certain that a special resolution has been properly passed by round robin procedure, you need to add up two separate figures (one for number, one for value) and both of them need to equal at least 75%:
1. At least 75% of the Number of sections in the scheme
In a scheme with 100 sections, owners who collectively own at least 75 sections would need to sign their agreement; and
2. At least 75% in Value according to the Participation Quota schedule
The value of each owner’s vote is based on the participation quota (PQ) attached to the section owned by that owner. The PQ schedule is found on the last page of the sectional plan. So in our example where there are 100 sections in the scheme, owners whose sections’ PQs add up to at least 75% of the total PQ would need to sign their agreement.
If you can get 75% of owners, in both number and value, to sign their agreement, then you have successfully passed a special resolution by round robin procedure.
At a General Meeting:
Special resolutions are required to authorise, amongst other things:
I will do a post on how to pass unanimous resolutions properly soon – so if you are interested you can Follow my blog to get email updates of new posts.
Feel free to leave comments below!
Image source: http://www.semclubhouse.com