Condominiums have registered by-law(s) setting out important corporate governance matters, including:
1. Directors and officers: elections and appointment, qualifications, length of terms of office, the number of directors and officers, etc.
2. Board meetings: quorum, voting, etc.
3. Borrowing money for the corporation
4. Assessing and collecting common expenses
5. Standard unit definitions and insurance deductible responsibilities
6. Maintenance and management of the property and corporation’s assets
and the list goes on.
But does the Board of Directors truly need to read these by-laws? YES!
By-laws are not documents of legal jargon that can be filed away – by-laws contain important information with an ongoing impact on the condominium. The by-laws must be followed in order to run the condominium effectively.
For example, how many directors are you required to have on your Board at any given time? If your by-law requires at least 5 directors, but you only have 2, then your Board has not met its quorum requirements and cannot properly carry out Board business.
Understanding your by-laws is also important when sending information to owners, such as a Notice of Meeting. If you are electing directors at your next Annual General Meeting, you should always review your by-laws before stating in the Notice of Meeting the number of director positions up for election and the length of the terms of each director position. The by-laws may also prohibit nominations from the floor, which the owners should be told in advance of the meeting.
During the COVID-19 pandemic, many condominiums have started holding electronic meetings, which may include electronic voting. As condominiums have been forced to adopt electronic methods, they are realizing these new methods can be highly effective and would like to continue in this manner after the pandemic ends.
Before passing a new by-law to permit electronic meetings and voting, we recommend reviewing your current by-law(s) to see if electronic meetings and voting are already permitted, and to ensure compliance with the by-law’s terms. If your current by-law(s) do not meet your condominium’s needs, they can be amended.
If reviewing your by-laws seems like a daunting task, we would be happy to assist you to ensure your condominium is operating as effectively, efficiently, and happily as possible.
Annie Bailey, JD
Lawyer, Robson Carpenter LLP