When to rule a motion ‘’Out of Order’’
All Bodies Corporate must hold general meetings (except specified two lot schemes). On the agenda for these meetings are motions submitted by either the Committee or lot owners. Unfortunately, sometimes a motion should never be voted on by the Body Corporate because it is flawed in a manner that makes it “out of order”. Such flaws include if the motion conflicts with the Body Corporate and Community Management Act, the relevant regulation module or the by-laws of the Body Corporate.
If the motion contains such a flaw, the person chairing the meeting must rule it out of order. Making decisions about what should be deemed out of order requires knowledge of the relevant legislation. Understanding the rights of the lot owners (e.g., owners of a unit/apartment/property), and the obligations of the chairman can be difficult. In addition, it is important not to show bias or prejudice when making the decisions. Therefore, it is important to adopt a procedure, keeping the relevant legislation in mind and know the law while remaining neutral on decisions.
All lot owners are in a position to submit motions to be placed on the agenda for general meeting. Unfortunately some lot owners have agendas of their own that will not sit comfortably with other lot owners’ interests, or are quite simply against the legislation.
For example, it is against the Act to discriminate against certain occupiers. A lot owner may submit a motion to restrict a certain class of occupier, such as renters, from using the facilities of the scheme, such as the tennis courts or swimming pool. This clearly discriminates against renters and this motion must be ruled out of order. This particular situation is a fairly clear cut example of what must be ruled out of order. Sometimes the distinction is nowhere near as easy, and a comprehensive knowledge of the Act and associated regulations (together with other relevant legislation) is needed to determine if a motion is out of order. As the Chairman must also give reasons for ruling the motion out of order, the process can become a little daunting for the average committee/chairman.
Add to this the fact that a motion may be amended “from the floor”, (that is, at the actual general meeting) and chairing a meeting when the agenda contains a dubious motion can quickly become quite a cumbersome obligation for a chairman.
If your body corporate ever experiences this type of situation please be aware that due to the complexity of the issues that arise, your body corporate should seek experienced legal advice.
This article was contributed by Jane Macdonnell, McColm Matsinger Lawyers.
Leave a Reply
Dear Jane and other lot owners.
As a non-Committee member, I convinced the Chair to over-turn a motion she wanted to rule out-of-order at a General Meeting. The Chair did not want the lot owners to have access to the email addresses of the scheme. The motion put to the EGM was resolved in favour of sharing email addresses and the Chair wanted to rule the motion out-of-order. Her reasons were unlawful. From the floor, I proposed a replacement motion to not rule it out-of-order and the owners in the room voted in favour of my replacement motion.. The standing motion to share email addresses was successful. This took courage and a practiced knowledge of the process but it worked in owners’ favour. Body Corporate governance is very important and so is the need for Committees to respect those owners who challenge and advocate for the rights of all owners, not just a few who don’t seem to want to follow legislative processes in Body Corporates.
Thanks Jane for your information. While I agree with all you have said, I believe you have not stressed one vital point in the process. If I read the legislation correctly (and I am sure I will be corrected if that is not the case), a motion correctly submitted by any owner MUST be included on the materials for an AGM or EGM unless it is withdrawn in written form by that owner. The legislation protects the committee if that material is, in fact, defamatory in its content. It is clearly the responsibility of any paid Body Corporate Manager to advise the committee of this obligation and ensure that any owner motion is recorded in the materials in the form in which it was submitted. As a lawyer, you would be surprised that a Body Corporate Manager (possibly in conjunction with a chairperson or secretary) could allow an owner motion to be declared “out of order” prior to a meeting and subsequently not place such a motion on the materials for consideration at the general meeting. Believe me, it does happen. It may surprise you more to hear that it is sometimes the larger Body Corporate Companies, major players in the industry, who allow this to happen. What concerns me is that many owners don’t realize they can exert their rights and have this corrected prior to the meeting. (Not easy but do-able with determination and persistence.) While the committee have a chairperson who may have examined the motion and may have received some advice that it can be identified as being “out of order”, that person may be delayed by some unexpected event and the “chairperson” duly elected by the meeting may, or may not, have the same view. This is a decision that can only be made at the time of the meeting. Also it must be noted, the members of the Body Corporate actually present can vote to over-ride the decision of the chairperson if they feel bias is involved. Please correct me if my interpretation is flawed. Sandra
Discussion of bundled motions would be helpful.
Thankyou for this information. I have had the unfortunate experience of a mean, ruthless and power hungry chairman and BC Management co who did not allow any motions (ie – all motions were “out of order under the Act” without any explanation) and would not explain why except to say you have to read the Act. They never ever explained what you have in this article, and so I think there should be a compulsory information session for all unit owners with the explanations of the Act – simple explanations! Also, how do you report such management errors..who wants to know?
I have some queries about the out of order ruling.. Our BC is a small block of four flats and we use the small schemes module. We had our AGM last week at which, our BCM advised that three motions were pit of order. The Committee (another person and myself) were not advised of this until at the AGM. (All motions had to be in by 30/11/2019. The eganda was emailed on 23/1/2020 with one non computer literate owner receiving his agenda 24 hours before,the AGM. Repeated phone requests to our BCM resulted in a registered letter to the owner.)
Our BCM advised she’d been visited at her office by one owner, who claimed she had spoken with BCCM and that these motions were out of order. Our BCM did not elaborate, but the rest of us – two present and one via teleconference – advised we believed,they were not out of order, and we wanted to vote. The motions are to do with the exclusive use area. We are seeking consistency of access and power. The current owner continually allows her tenants to use the enclosed garage – the only enclosed car space available – attached to this flat, as extension of living space. With the former owner, we had a Conciliation agreement in 2015, with changed wording to,the,exclusive use by laws and discussion of approval of certain improvements. This approval wa conditional. These conditions were never fully met by the former owner. In 208, the current owner started allowing this area to be used for purposes other than intended. That is on site parking of motor vehicle and storage. In recent times, the committee realized that all the conditions of the approval were never met. Therefore, the AGM Motions were to restore consistency across all the exclusive use areas. Please, we need help.