Proxies
“The only
thing that counts up here is votes. Everything else is bull.”
—U.S. Representative Frank
Annunzio
Proxy voting is a form of voting whereby owners delegate
their voting power to other persons to vote in their absence. A person
so designated is called a "proxy" and the owner designating him or her
is called a "principal".
Anyone can act as a proxy. They do not have to be an owner or have any
connection with the corporation.
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An owner may
designate a proxy to attend and vote at an owner's
meeting in his or her place if they are not able to attend or if they
do not wish to attend.
Only owners who have been registered with the corporation 20 days prior
to the date of the meeting and who are not in arrears in their common
element fees for over 30 days can vote.
Proxies allow one person to have an unlimited number of votes at the owners' meeting.
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The
need for proxies
Many owners have little interest in the corporation's affairs and will
not attend AGMs or special owner meetings. However, certain percentages
of owner attendance is required to conduct the condo's business. The
corporation needs 25% of all the owners in attendance to hold an
owner's meeting. Fifty percent plus one of the owners is required to
vote to add, change or rescind
a by-law. Many owners won't attend but they will sign a proxy.
Proxy
requirements
A proxy may collect as many proxy forms from as many owners
as he
is able.
However, the owner must fill in the form stating how much voting power
he or she is giving the proxy. It is acceptable for an owner to sign a
proxy
that has the names pre-printed.
Types
of proxies
Proxies can be used to vote for candidates seeking office, to
vote in
favour or against a resolution or by-law or a proxy can be used simply
to allow the meeting to reach quorum.
The
forms
Owners can use their own downloaded form and the names of candidates can be
pre-printed on the proxy forms as long as they are printed prior to the owner
signing the proxy. Scanned and faxed forms are valid.
A proxy instrument has to use the pdf form that can be downloaded from the Ministry's website.
Note that the form states:
This
is a prescribed form, and accordingly it may not be substantively
changed. You can delete portions of the form that are not relevant or
don’t apply in a particular case. You can also add words or
clarifications, as reasonably required. But you must retain the
substance and general format of the form.
A proxy
battle
A proxy fight or proxy battle may occur when an
owner or a group of
owners develop opposition to some aspect of the corporate governance,
often focusing on board of director elections.
Owner-activists attempt to persuade owners to use their proxy votes to
install new directors for any of a variety of reasons. On the other
hand, the directors and perhaps the manager, will persuade the same pool of
owners to sign proxies on their behalf.
This can become a rough and tough political battle.
Canvassing
for proxies
It would best for all if the corporation has by-laws establishing
procedures, policies and a code of conduct for all candidates and their
supporters who canvas the owners for proxies.
The by-laws should set hours for going door to door canvasing for
support. There should be a maximum number of times owners can be
approached (to prevent hounding) and
owners should be able to request being added to a "Do Not Call" list.
Owners should be told that if they are being harassed by any
candidate or their followers they should inform the manager.
On the other hand, all employees, including the manager, cleaners,
superintendent and the security guards should be instructed to stay
neutral during the election and that they must not take sides.
Employees who fail to remain neutral need to be disciplined or their
employer removes them from the property.
The advantage
In a proxy fight, incumbent directors and management have the odds
stacked in their favour over those trying to create change.
The legislators gave the incumbents an advantage when they staggering
the boards by having different election years for different
directors.
The incumbents also use various tactics to stay in power including:
1. Controlling access to the corporation's records.
2. Creating restrictive requirements in the by-laws.
3. Controlling communications with the owners.
The board sends out a blank proxy, or partially filled in proxy, with
the AGM package. Written
instructions with the package informs the owners that they can drop off
their proxies at the management office or mail it to the property
management company's office.
The board also has the list of all the owners addresses, telephone
numbers and e-mail addresses. This list includes the contact
information
for the absentee owners. They do not share all of this information with
the rest of the candidates.
As a result, the boards win most proxy fights.
Registration of
proxies
The proxies register their proxy statements prior to the start of the
meeting. The signed proxies are registered and then will be placed in
the ballot box.
If the corporation has a by-law that authorizes the board to have a
cut-off date for registration of proxies, then proxies should not be
accepted after the cut-off time on the basis that to do so would be
inequitable and prejudicial to the other owners.
If there is no by-law, some corporations accept proxies up until the
time of voting. Other corporations refuse to accept proxies after
quorum has been attained and the meeting commenced.
The proxy has all the rights at the meeting that the owner would have.
Though the road
be hard
The battle for proxies must be fought and the challengers must be up to
the task for although they are at a disadvantage, this is a battle that
must be won.
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