"Who do you act for, Mr. Chairman?"
With autumn now underway, Annual General Meeting (“AGM”) season is upon us. I'm often asked to chair my condominium clients’ AGMs and I look forward to meeting face-to-face with the boards, owners and managers I've worked with during the year, mostly by phone, email or letter.
More than that, I especially enjoy being part of a meeting where members of a condominium with difficulties band together to overcome those problems and move forward as a more united community. Those experiences are among the most personally rewarding in my line of work.
Aside from the social call, it's often useful for condos to ask their lawyer to be chair of the AGM because many directors are not comfortable with public speaking or may not know how to navigate the procedural pitfalls that may arise. Further, having an objective person at the helm can diffuse much of the tension that typically arises and gives greater sense of confidence and fair play to everyone present, particularly if there is a hotly contested election or vote on an issue.
Not everyone feels that way, however, and if this year is like every other year, I will probably be asked the following question at one or more of the meetings where I'm the chairperson:
“You’re the condo corporation’s lawyer and you’re paid from our common expenses, so don’t you act for us owners?”
This question typically arises after I make a ruling or statement that one or more owners don’t agree with, or if I try to move the meeting past an overly belaboured point or to skip to the next agenda item or allow another person to ask a question or make a comment.
Because this question is so common, I’ve taken a shot at giving a short answer.
Lawyers chairing a condominium’s AGM have two duties:
First: Any chairperson must ensure that the meeting is conducted in a fair, orderly and efficient manner and in accordance with the Condominium Act and the declaration and by-laws of the corporation.
Second: Lawyers performing any service for any organizational client must, according to the Law Society’s rules of professional conduct, exercise their duties in a manner that serves and protects the interests of the organization (as opposed to the interests of the property manager, board of directors or one or more unit owners, or the unit owner who asked that question in the first place).
This concept of acting "in the interests of the organization" was discussed by the Supreme Court of Canada in the case of BCE Inc. v. 1976 Debentureholders, which we wrote about and quoted relevant portions here. The case dealt with the fiduciary duty of directors of a business corporation but it is to some extent applicable to the duty of a chairperson of a condo's AGM, particularly in treating the various stakeholders fairly.
A condominium corporation, like any other organization, has a large number of interests, many of which may conflict with each other, and a number of different stakeholders, each with their own different (and often conflicting) interests. Treating all of those interests and stakeholders fairly may seem like a difficult juggling act and it sometimes is.
When it comes to conducting the corporation's AGM, however, the most important balance to be struck is, in my humble opinion, between facilitating a meaningful and constructive dialogue to help the community bond on the one hand, and completing the required business promptly and sending the owners home to their families on the other.
If you're a condo unit owner, make it a point to attend your AGM this year. Your condo needs you.
An AGM is an atmosphere where emotions can enter the forum. It is my humble opinion that it is a prudent board that appoints an impartial chairperson. Sometimes the expectation from the masses that their neighbour and friend will somehow be able to exercise the constraint necessary to govern, as you point out, a meaningful and constructive meeting seems unfair. An excellent article pointing out the solicitors obligation to act in the best interests of the organization a.k.a the Condominium Corporation.
Although I certainly agree with much of what Chris has said, I nonetheless must question the propriety of a lawyer (or anyone else for that matter) chairing any meeting of owners or of the board where the by-laws do not explicitly provide for such delegation of authority.
There is nothing improper about a board delegating the task of chairing the meeting to the corporation's lawyer.
In my experience, owners typically appreciate the fact that meetings progress more smoothly and quickly with the help of an impartial lawyer as chair.
The people who don't appreciate this are the anarchists and others who can't figure out that the lawyer acts for the corporation and not the board. The people who start yelling at the opening of the meeting that the lawyer has a so-called conflict of interest simply aim to create chaos and hijack the meeting to push their own agenda so that nothing is accomplished. That, in my view, is improper, and a strong and experienced chairperson is the only defence.