A Toronto condominium corporation finds itself in the news lately (link to article here) over a hotly-contested election.
Two unsuccessful candidates brought a legal proceeding claiming election interference after they won on an initial count by a slim margin of two votes but lost on a recount. The candidates claim their proxies were disqualified without reason and votes were illegitimately added the ballot box. In the wake of a close election we often see accusations of conspiracy, corruption and impropriety thrown around. In this condo’s case, this has resulted in a nasty legal battle: both sides reportedly incurred at least $200,000 in legal fees so far.
While the truth remains to be seen, the financial and time cost devoted to determining who’s right seems extreme; the issue is clearly important to those involved and it is up to the parties whether to continue the battle. Whatever the case may be, Tony’s Takeaway is that these problems are avoidable.
Whether meetings are held electronically or in-person, here are a few best practices we suggest to ward off accusations of “stolen elections” or demands to “stop the count”:
- Update and Maintain your Owners’ List: Condominiums must keep and maintain a list of all owners and mortgagees – for obvious reasons, this list is the only record to determine which owners/units are eligible to vote in an election. A common problem we see is owners claiming they weren’t provided notice of the meeting (and therefore prevented from voting) only to find out the condo didn’t have their current information on file.
In the lead-up to a meeting, it is prudent to include a letter with the meeting notice asking owners to provide their current information. This letter should be sent to all owners in the ordinary course but in case there are owners with outdated information, posting the letter in the elevator, community bulletin board or mailroom is a second line of communication.
- Set an Advance Proxy Submission Deadline: We encourage our condo clients to set an advance proxy submission deadline falling at least 24 hours before the meeting. This puts the onus on owners to be proactive in collecting and submitting proxies while giving the property manager an opportunity to register them well before the meeting – we see too many meetings get off to a late start because a pile of proxies come in at the last minute.
An early proxy deadline also makes it easier to verify proxies. Owners are entitled to submit multiple proxies, however, the latest proxy revokes and takes precedence over all earlier proxies. For verification, the government-mandated proxy form requires owners indicate the date and time they sign their proxy. To avoid scrambling to verify proxies under pressure, an advance deadline gives everyone a bit of breathing room.
- Keep a Tight Register of Owners in Attendance: Whether owners are attending the meeting in-person, virtually or by proxy, it is imperative that everyone is carefully registered. This prevents double-voting and ensures there can only be one vote per unit. This is fundamental to preserving the integrity of the election and it all starts and ends with the Owners’ List and Register.
- Keep Ballots and Proxies for at least 90 Days: Whether votes are cast by paper ballots, electronic votes or proxies, the Condo Act requires corporations keep “all instruments appointing a proxy or ballots” submitted at that meeting for at least 90 days. This gives owners an opportunity to review the votes and verify the election for themselves. However, owners should be aware that they any information relating to specific units/owners will be redacted. While owners will be able to see which candidates received votes, they won’t be able to see who voted for those candidates.
- 500 votes does not mean 500 ballots: At least once an AGM season, we see an owner cry election fraud since “there were 500 votes cast but there are only 250 units at the condo”. What many overlook is that while there can only be “one vote per unit”, this does not mean “there can only be one candidate per ballot” – oftentimes there are usually multiple candidates on one ballot. An owner may vote for as many candidates as there are vacancies or they can choose to vote for fewer candidates than there are vacancies. Provided each candidate receives fewer votes than there are registered owners at the meeting, there is usually no cause for concern.
Responding to an election challenge can be fraught with feelings of mistrust or resentment, but it is ultimately a necessary function of the democratic process afforded by the Condo Act. As disagreeable as the process can be, following these steps can shut down rumours of election misconduct and avoid a $200,000 legal battle.