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.