Thinking Inside the Box

A Paddocks Sectional Title Lifestyle Blog

Unanimous Resolutions – How to Pass them PROPERLY

sectional title unanimous resolution

By Jennifer Paddock

A unanimous resolution is the type of agreement amongst sectional title owners that is required for very important decisions such as:

  • the sale or long lease (over 10 years) of part of the common property
  • the “deemed destruction” of some or all of the buildings
  • changing management rules
  • authorising luxurious improvements to the common property

For more examples and for the levels of consent necessary for different body corporate decisions, click here.

A unanimous resolution can be passed in one of two ways – either in writing by ‘round robin’ procedure (ie. without a meeting) or at a general meeting of the body corporate. I’ve provided details below on how each method of passing a unanimous resolution can be achieved:

By round robin:

A unanimous resolution can be achieved without a meeting if all owners (100%) sign their acceptance of a proposed resolution. This is truly a unanimous resolution in that it is a resolution without dissent and every owner in the scheme has agreed to it.

 

At a general meeting:

Notice

  • 30-day notice period (unless it is decided by the trustees to give a shorter notice period due to the urgency of the matter or a shorter period is provided for in the scheme’s rules)
  • the notice must specify the proposed unanimous resolution

Quorum

  • At the meeting, 80% of all owners (in number and value*) must be present to form a quorum. Note: this is a raised quorum requirement – higher than the ordinary quorum necessary for meetings at which there is no unanimous resolution on the agenda.

*What do you mean in “number and value”?

Number = the number of sections in the scheme. So if there are 100 sections in the scheme, owners who collectively own 80 sections would need to be present or represented at the meeting to form a quorum.

Value = the value of each owner’s vote based on the participation quota (PQ) attached to the section(s) 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 80% of the total PQ would need to be present or represented at the meeting before a quorum would be present.

Voting

  • Every owner present or represented at the meeting must vote in favour of the resolution for it to be passed, ie. there must be no votes against the resolution (that is why a unanimous resolution can also be referred to as a ‘resolution without dissent’)
  • Abstentions (those who are present or represented and entitled to vote but who chose not to) are counted as votes in favour of the resolution
  • Even one vote against the resolution defeats it

 

Written consent where proprietary rights are negatively affected

If a unanimous resolution negatively affects any owner’s proprietary rights (the term ‘proprietary rights’ is not defined in the Sectional Titles Act), that owner must agree in writing before the unanimous resolution is passed. But if the body corporate cannot achieve a unanimous resolution it can go to Court and ask for assistance.

 

I have also written a post on How to Pass Special Resolutions Properly if you are interested.

Have any questions or comments? Post them in the comments section below!

Image source: alyboyce.wikispaces.com

Advertisements

18 comments on “Unanimous Resolutions – How to Pass them PROPERLY

  1. Ben
    July 8, 2016

    HI,

    As a director on a Board I find I’m faced with too many board notes for approval via round robin. I believe round robin should only be done when it’s an urgent matter that needs approval. How can the number off boards sent to the directors by the company be reduced? Any suggestions

    • Paddocks
      July 18, 2016

      Hi Ben,

      Thanks for your comment. Please note that the article refers to unanimous resolutions passed by members in sectional title schemes. It seems that your query relates to directors resolutions in Home Owners’ Associations and reference to the governance documentation as well as the Companies Act would need to be made.

      Regards,
      Paddocks

      • Ricardo
        July 18, 2016

        Hi, Ben

        I fully understand your feeling and frustration, it would be nice if paddock can give some advice on handling with board notes via round robin or as I call it “bandit” .

  2. Caryn Foddering
    April 6, 2016

    Hi, is it legal for a unanimous resolution to be sent via email and be signed by the owner and returned to the Trustees. I have all but one signature and that owner resides in Germany. Would it be acceptable to scan the resolution signed by all other owners and get her to sign and return to me via email?

    • Paddocks
      April 7, 2016

      Hi Caryn,

      Thanks for your comment. Yes, it is possible to circulate and receive the signed resolution in such a manner. Section 1 of the Sectional Titles Act, under the definition of unanimous resolution, only provides that such a resolution must be agreed to in writing by all the members of the body corporate.

      Regards,
      Paddocks

  3. S.D.Lutchmen
    January 30, 2016

    How do new owners be aware of the resolution?
    Does it have to be passed at Every AGM.
    A resolution was made for owners to maintain the inside of the flat and the foundation which is common property

    Body Corporate did not follow resolution and fumugated the foundation of one unit 2 years later.

    Can body corporate a year later enforse the resolution ie. Demand for owner to also mantain foundation. ?

    • Paddocks
      February 3, 2016

      Hi there,

      Thanks for your questions. We do not offer free advice, however we answer one question a day on our Paddocks Facebook page. Alternatively, you can contact our consulting division on consulting@paddocks.co.za or call 0216863950 for assistance.

      Regards,
      Paddocks

  4. Nicolas
    March 5, 2015

    What determines whether a special resolution is voted on at an actual meeting of members or whether done by way of round-robin?

  5. Jannie Engelbrecht
    August 4, 2014

    what resolution is required to introduce a levy stabilisation fund?

  6. Angelique
    June 29, 2014

    Is there any case law where a body corporate could not reach a unanimous resolution for conferring EUA rights (Section 27A – management rule amendment) and accordingly approached the High Court to enforce a unanimous resolution and was successful in such application?

  7. paddocks
    May 16, 2014

    Hi June, the answer is ‘no’. PMR 58 which deals with the quorum of a postponed meeting due to a lack of quorum does not apply to a meeting at which a unanimous resolution is to be taken. The Sectional Titles Act (which trumps the prescribed rules from a hierarchy perspective) requires a quorum of at least 80% of all owners in number and value to be present at a meeting before a unanimous resolution can be voted upon.

  8. June Edwards
    May 15, 2014

    Dear Jennifer, we need to pass a Unanimous Resolution at a Special General Meeting, should we not have a quorum of 80%, does the postponement rule apply with those present at the postponed meeting serving as a quorum? So all in favour at the next meeting will equate to 100% vote in favour?

  9. Pingback: Authorising Luxurious and Non-Luxurious Improvements to Common Property | Thinking Inside the Box

  10. Peter Warren
    February 17, 2014

    If the meeting is not quorate can the Body Corporate still approach the High Court?

    Can the trustees do it off their own bat, or does it require a General Meeting to authorize this,

  11. Dina Porteous
    January 24, 2014

    One should remember that when an Managing Agent is appointed Section 32 of the Estate Agency Affairs act applies to these funds

  12. Karen Miles.
    October 18, 2013

    Dear jennifer,
    what sort of resolution is need if: i was the person who opened the bak acc in our body corporate name. after many arguements with the MA, i resigned as chairlady, and the new trustees submitted a resolution to the bank, removing my name and access,without telling me.
    What recourse do i have ,as i wanted to know, why i wasnt informed of these resolutions and surely a sgm should have been called?
    regards,
    Karen.

    • paddocks
      October 18, 2013

      Hi Karen. thanks for your comment. The Sectional Titles Act authorises the trustees to manage the body corporate and only a trustees resolution is required to change the authority relating to the operation of the body corporate’s bank account (so no SGM was necessary). From your comment, there is no obvious irregular behaviour here.

      • Karen Miles.
        November 28, 2013

        Hi,

        Then surely I am allowed as a member to see the resolution as it is part of the body corporates records, and as I was not informed, why was it necessary to do this behind my back? Aren’t i allowed to attend all meetings? are the trustees allowed secret meetings?

        regards,

        Karen.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow us on Twitter

Address:

+27 (0)21 686 3950
Mon - Fri
8am - 5pm

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 444 other followers

%d bloggers like this: