A quorum is the minimum number of members of an assembly or society that must be present at any of its meetings to make the proceedings at that meeting valid.

Previous management rules (“PMR”) 57 and 58 contained in Annexure 8 to the Regulations made under the Sectional Titles Act 95 of 1986 (“the ST Act”), dealt with the quorum requirement for general meetings of the body corporate.

These two rules have been combined to form the basis of the new PMR 19 contained in Annexure 1 to the Regulations made under the Sectional Titles Schemes Management Act 8 of 2011 (“the STSM Act”).

PMR 19(1) states that no business can be transacted at a general meeting unless a quorum is present or represented, for example by proxies.

The revision of this PMR includes certain major changes. Previously the quorum requirement was dependant on the size of the scheme. There were three categories:

• Schemes of 10 units or less: the number of owners holding at least 50% of the votes.
• Schemes of less than 50 but more than 10 units: the number of owners holding at least 35% of the votes.
• Schemes with 50 or more units: the number of owners holding at least 50% of the votes.

An improvement to the new provision is that it is now clearly states that quorum is calculated on the value of votes, and not on the number of votes. PMR 19(2) states that a quorum is constituted when:

• A body corporate that has less than 4 primary sections or members (only 3 or fewer primary sections or members), two thirds of the total value of votes must be present or represented;
• In any other scheme, one third of the voting values are required.

The reduction of the quorum requirement to one third of the voting values, for all but very small schemes, has the virtue of simplicity and will make it easier for schemes with between 4 and 50 units to achieve quorums. However, for schemes with above 50 units, the quorum requirement is effectively increased from one fifth to one third of the total voting values.

Where there are 2 or more members, at least 2 persons must be present to form a quorum, unless all the units are registered in the name of one person.

There are two categories of vote values that are not taken into account when calculating a quorum:

Firstly, the voting values of units registered in the developer’s name are not taken into account when calculating the the value of votes required to constitute a quorum. The fact that the value of the developer’s votes are not taken into account in calculating the quorum, is designed to ensure that developers do not arrange for the body corporate to take important decisions, without the presence of a reasonable number of other owners. This provision could cause difficulties in cases where developers choose to retain a substantial number of units in a scheme.

Secondly, to establish a quorum, and for the purposes of section 6 of the STSM Act (dealing with general meetings), any section registered in a body corporate’s name, is not taken into account, and the body corporate, is not considered to be a member of itself in terms of PMR 19(3). The body corporate cannot have representation rights at its own meetings. This provision effectively suspends the representation rights attached to any unit registered in the name of the body corporate so that meetings are constituted only on the basis of member representation.

The new PMR also provides for situations where a quorum is not present. PMR 19(4) states that if within 30 minutes from the time appointed for a general meeting a quorum is not present, the meeting stands adjourned to the same day in the next week at the same place and time. If, on the day to which the meeting is adjourned, a quorum is still not present within 30 minutes from the time appointed for the meeting, the members entitled to vote and present in person or by proxy constitute a quorum.

If you are need us to assist in any way, please contact us at consulting@paddocks.co.za.

Image source: equipoquorum.com

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Article reference: Paddocks Press: Volume 11, Issue 11, Page 02.

Dr Carryn Melissa Durham is one of the most highly qualified Sectional Title Attorneys in the country (BA, LLB, LLM and LLD), Carryn forms part of the Paddocks Private Consulting Division.

This article is published under the Creative Commons Attribution license.

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