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Changes to the Condominium Act Effective October 1, 2023

Changes to the Condominium Act Effective October 1, 2023

On June 8, 2023, the Ontario government passed Bill 91: Less Red Tape, Stronger Economy Act, 2023, which includes amendments to the Condominium Act, 1998 and regulatory changes to O. Reg 48/01.  Effective October 1, 2023, these changes replace the temporary measures for virtual processes, including virtual meetings, which were enacted in response to the COVID-19 pandemic.

The amendments allow for the following:

  • holding virtual or hybrid meetings (combination of in-person and virtual)
  • conducting voting virtually or in hybrid form
  • facilitating the sending of notices or other documents electronically, including sending notices by email without an owner’s agreement/consent

It is noteworthy that the amendments to the Act do not negate or override a corporation’s existing by-laws.  If your corporation has a by-law or declaration provision that defines or limits how virtual/hybrid meetings and voting should be conducted, those provisions will have to be complied with unless repealed.

To assist condominium managers and boards conduct virtual and hybrid meetings, the CMRAO has published an excellent guide entitled Administering Virtual Meetings: A Guide for Condominium Managers.  This guide was developed to help condominium managers prepare for the planning and execution of virtual/hybrid meetings and undertaking other virtual processes, such as electronic voting and notices. We encourage our managers and boards to read the guide.

The CMRAO stressed the importance of using the right platform for virtual or hybrid meetings, and noted the merit of using a proven, third-party application.  As the security and confidentiality of the voting process is the most critical meeting requirement, the CMRAO specifically stated that managers must stay neutral and impartial to avoid being perceived as influencing the process. Managers must always serve as neutral administrators and must work with a competent third-party meeting host to maintain the confidentiality of the voters’ information. Voting results must always be kept secret until ALL voting is complete.

The CAO made many similar recommendations in its Guide to Conducting Electronic Owners’ Meetings: What Owners and Directors Need to Know which it published in November 2022.

Additional details on the October 1st changes follow below.

Virtual Meetings

The amendments  permit both board meetings and owners’ meetings to be held by electronic means or in a hybrid manner (with some in-person and others by electronic means).

Although a by-law is not required to hold virtual or hybrid meetings, your corporation may already have one.  If you do,  make sure that when you have your meeting, you comply with the provisions in your by-law. The corporation’s by-laws may limit the manners by which these meetings may be held and may specify requirements that apply.

Board Meetings

Virtual or hybrid directors’ meetings are allowed provided all participants are able to communicate with each other simultaneously and instantaneously. Therefore, for example, meetings via email would not be permitted.

The “unanimous consent” requirement to initiate virtual/hybrid board meetings is eliminated. This means the majority of the board could call a virtual or hybrid meeting even if one member does not consent. As long as your condominium’s governing documents do not have a by-law requiring such, virtual board meetings can proceed without obtaining the consent of all directors.

Owners’ Meetings

Virtual or hybrid meetings will be permitted using “telephonic or electronic” means without the need to pass a by-law authorizing these types of meetings. Similarly, voting using telephonic or electronic means will remain an option without the need to pass a by-law.

The amendments also clarify that attending virtually or casting a telephonic or electronic vote (including before or during the meeting) means the person is “present” for the purposes of the Act, like counting toward quorum.

All persons in attendance must be able to “reasonably participate”. There is no definition of “reasonable.” However, it likely excludes meetings held virtually using webinar mode and that don’t allow for questions from owners during the meeting.

One lawyer noted that a helpful clarification that could be included in a by-law would be a provision stating that it’s up to the board to decide how a particular meeting will be held (whether virtual, in person or hybrid) and how voting will occur at the meeting.

Electronic Voting

You no longer need a by-law to hold a virtual meeting or electronic voting or telephone voting. However, if you already have an e-voting/virtual meeting by-law, make sure that when you have your meeting, you comply with the provisions in your by-law.

Those corporations without a by-law may still want to put one in place at a later date so that there are procedures in place.  Such a bylaw  may include provisions which set out procedures for voting in order to avoid anyone accessing ballots/voting results prior to the close of the vote, to ensure that the secrecy of the vote is not compromised.

Meeting hosting and electronic voting can be completed via telephone, fax, or electronic balloting software such as CondoNexus, Horlick Meetings, iHost-IT and GetQuorum.

The security and secrecy of the voting is a critical concern. For that reason, having a 3rd-party provider manage your electronic voting and record-keeping is strongly recommended. Corporations will need to ensure that protocols are in place so that the vote is reliable and only those entitled to vote can do so.

Section 55(1), which deals with record keeping has been amended to specify the records of voting include “…any record of  votes cast through telephonic or electronic means before or at the meeting.” The corporation’s records must include a record of any votes cast at meetings, regardless of how the vote was cast (i.e., electronically, in-person or by proxy).

Some lawyers note that  the amended Act allows persons to attend a meeting of owners by voting in advance. In their view, the key concern with this change is as follows: How will an advanced vote count in relation to motions to amend and in relation to amendments to the business (including new nominees for election)?  In some cases – depending upon the nature of the business – advanced voting may or may not make sense, and in any event may require careful handling.

How paper proxies are handled will vary from provider to provider. There are different ways to handle paper proxies, including inputting the proxies into the electronic voting system and allowing owners to replace their proxies with their own vote should they choose to.

Voting records, electronic or paper, must be retained for at least 90 days.

Notifying Owners by Email

The amendments allow condominium corporations to deliver meeting notices and other materials to owners electronically, subject to any by-laws that prohibit it and so long as the owner doesn’t advise that notice cannot be delivered in that manner.

That means that you no longer need to obtain an Agreement to Receive Electronic Notices form.

Email addresses for all owners would become the address for service with the owner needing to opt-out if they prefer other forms of communication.

Crossbridge has updated its standard operating procedures (SOPs) governing meetings to incorporate the changes that are effective October 1, 2023.  Managers should consult the NA3.0 – SOP and the related SUPPORTs for more information.