As most of our readers know, condominium by-laws in Ontario can only be adopted if approved by at least a majority of all registered units. But this is not true of all by-laws. Some can be adopted by a “simple majority”. This post is about those.
What’s a by-law?
We’ve blog already on the difference between the Declaration, by-laws and rules.
Generally speaking, by-laws deal with the governance of the condo corporation (ie. how they are run). They deal with qualification of directors; quorum; rules on voting; whether the corporation can borrow money; what constitutes a standard unit by-law; and (at least for now) who pays for the deductible if the corporation makes an insurance claim etc…
By-laws cannot be inconsistent with the Declaration or the Condo Act and must be reasonable.
How are by-laws adopted?
By-laws are first adopted (or presented) by the board by way of a resolution at a board meeting. Then they are submitted to a vote of owners.
As indicated above, most by-laws are not effective unless they are approved by at least 50% of all registered units (regardless of whether these owners are participating to the meeting or casting a vote). This is what makes them rather difficult to adopt.
By-laws adopted by simple majority
Some by-laws, however, can be adopted by simple majority, which means that they become effective if they are approved by at least 50% of those owners participating to the meeting of owners called to vote on it.
Indeed, section 56(10)(a) of the Condo Act specifically provides that some by-laws can be approved by a lower percentage if provided by regulation. Section 14(2) of the general regulation does, indeed, provide for a few such exceptions. Unsurprisingly, the regulation drafting style requires that the reader have a map, a compass and a flashlight to figure out which by-laws can be adopted by such a lower majority. See for instance subsection 14(2)(s) which confirms that by-laws governing “information described in sub-subparagraph 4 ii C of subsection 24.3 (4) to be included in a notice described in paragraph 4 of that subsection, in addition to the information required by that paragraph” can be adopted by a simple majority. Rejoice!
In an attempt to clarify the playing field a bit, we list below, in plain English language, the topics which can be adopted by a simple-majority by-law. These include by-laws dealing with:
- Telephonic or electronic voting;
- Corporation records, such as the determination of which additional records must be kept by corporations and additional preservation periods for certain records;
- The additional information to be included in the Information Certificates, as well as any increase in their frequency;
- Additional information to be disclosed by directors running for election, the timing of such disclosure and whether the disclosure must be in writing;
- Additional material to be included in the preliminary notice and/or the general notice of meeting;
- Additional material to be placed before owners at a meeting of owners;
- Additional information to be included in the record of owners and mortgagees;
- The manner in which an owner may be present at a meeting or may be represented by proxy;
- The method of electronic communication that the board may use under the Act;
- The additional portion of the proxy or ballot which is accessible to owners wishing to inspect them; and, amongst others,
- Additional information required to be included in a notice to owners dealing with the installation of an electric vehicle charging system.
All of the above topics can be regulated by by-laws which only require a simple majority of owners to be adopted. A simple majority, as stated above, means that such by-laws can be adopted by the majority of units participating to a meeting (either in person or by proxy).
The good news is that it makes it far easier to adopt these by-laws and you no longer need to adjourn the meeting to collect proxies when you fail to reach a 50% quorum. The “bad news” is that since 25% of the units constitutes sufficient quorum to conduct business at an owners meeting, the above by-laws can therefore be adopted by as little as 13% of the units. Another good reason to get interested in the affairs of your corporation and to show up at owners meetings.