Who’s in charge? Condo board, manager or annual meeting

There are times in condominium living when we need to know who’s in charge. An issue might arise that requires a political decision, or a problem looms that requires spending considerable funds. Which, come to think of it, leads right back to politics. While the property manager employed by the condo corporation administers daily issues, he or she has no deciding authority. It is the condo board that must grapple with issues and make tough decisions, just like municipal council does at city hall. The property manager then implements those decisions, just like staff do at city hall.

In fact, condominium law parallels municipal law in much of North America, with a few specific differences. Here in Alberta, the elected condo Board of Directors is the governing body of the condominium corporation, chosen at an annual general meeting.These three to seven people have the duty to make decisions in the best interests of all the owners.They also have considerable authority and discretion in order to get their job done.

So, the condo board is in charge, right? Well, yes, except Alberta’s Condominium Property Act also specifies that boards shall take direction from an annual general meeting, or a special general meeting of the corporation of all the owners, which can usually be called by owners who are not on the board. This meeting could also result in the election of a new condo board, which might reverse decisions made by the previous board. Such an election or direction, of course, is subject to proper notice having been given to all owners (see your bylaws), while reversing decisions can be hard if contracts have been signed. Some things just can’t be undone. In city hall, the council passes bylaws, while in a condominium, the owners must approve bylaw changes with a 75 per cent majority vote.

Those are the important differences between a condominium and city hall, which are otherwise remarkably similar. In short, condo boards have a large mandate, but can be turned out of office in part or in their entirety, and condo boards must take direction from general meetings. Condo boards also determine its own table officers, e.g.: Its own chair, secretary, treasurer and so forth. I wouldn’t want my mayor chosen this way, but it’s a good and simple system for the smaller world of condominium.

In some condominium corporations, the board is so fragile, that the property manager ends up running the show. It’s not good, and there’s liability involved for the management company. What are you going to do when most owners are absentee landlords, or for some other reason can’t or won’t hold meetings and make decisions? Don’t buy into a condo community being managed this way – however, recognize that some condominium developments would have no leadership at all if the property manager didn’t take the reigns.

Let’s review a make-believe example of some of the above. Pretend that a condo townhouse development called ‘Sleepy Hollow Condos’ (100 homes) has always had an outdoor pool, and that members of the board seem to be among the few owners who actually use it. At 30 years of age, the pool requires a $250,000 renovation. Lacking an adequate reserve fund, the board votes to special assess $2,500 on each home to rebuild the pool, which a majority of owners would rather see closed down.

A group of objecting owners circulates a petition to all their neighbours calling for a special general meeting and serving notice that a single motion will be on the agenda.It reads that, “the board is directed to cancel the planned special assessment, close the pool permanently, fill it in, and create a modest rock garden.” The meeting comes to pass, the motion is voted upon, and it passes 93 to 7 (the board members). After the meeting the Board remains in place. It has the same decision-making power as before, but on this issue, it can only decide when to close the pool, which contractor to hire to fill it in, and how many cacti to plant.

This scenario is fanciful, and reality is usually messier. Yet it shows how the Condo Act and your bylaws provide checks and balances, should you need them. Democracy: It’s a wonderful thing.

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