COVID-19 (Coronavirus) – Update #11

Dear Strata Councils,

Below we write to you with more updates on Strata Corporation operations and the implications of COVID-19, particularly on meetings and Annual General Meetings and growing concern about the economic impact on Strata Corporation finances:

• • Late Penalties – Strata Councils should begin to discuss an approach to arrears from Owners who are unable to make payment of their monthly Strata Fees and/or Special Levies.  The legislation has not changed. All Strata Corporations retain the right to levy fines, add interest and file liens against Owners who do not make payment on time.  However, exceptional times call for exceptional measures and it may be wise to consider an approach to Owners facing financial hardship such as offering payment plans and/or deferral of penalties.  Doing so will require careful consideration. Your Strata Corporation relies on the fees it collects to maintain basic operations, and so there is not a great deal of flexibility for you (unfortunately) when it comes to deferring revenue.  Strata Corporations have very little capacity to borrow and/or dip into reserves indefinitely.  Ultimately, each case will have to be treated individually by Councils who will have to weigh the many competing considerations at hand;
  • General Meetings – As we previously noted, the Province has enacted an emergency Order allowing all General Meetings to be held electronically (previously, only Strata Corporations with a specific bylaw were permitted to do so).  To be clear, many strata corporations have and continue to convene General Meetings and allow absentee voting by restricted proxy which is working quite well for both small and large strata corporations under the circumstances. An electronic meetings is a different thing entirely and requires that owners be able to attend by phone/Zoom/etc., which brings with it significant complications and challenges.While an electronic meeting may be practical for some Strata Corporations, particularly those that are very small, in our view (and that of our main industry association, the Strata Property Agents of British Columbia (SPABC)) it remains impractical for larger meetings.  We have serious concerns about the ability for larger strata corporations (i.e. greater than 12-20 units) to conduct these meetings without running afoul of various requirements within the Strata Property Act (SPA), most notably those around proper registration of attendees, privacy, counting of votes, calls for secret ballots, proxy tallying, amendments from the floor and more.  It is also quite clear that hosting a General Meeting via electronic means requires technical expertise that we are not in a position to provide at this time.  The Condominium Home Owners Association (CHOS) have assisted some of their members with the administration of electronic meetings and this has required upwards of three members of their staff. Property Managers do not have sophisticated networking equipment set up at home and rely on the same sort of equipment you likely have in yours. This is to say that it is generally reliable but sometimes computers do crash and WiFi does cut out (you have no doubt all experienced by now a virtual meeting where someone’s microphone or camera wasn’t working).  We are among the many firms looking to source/develop platforms to ensure strict compliance with the SPA but these are not yet available and thus we are discouraging our clients from hosting General Meetings electronically. If you intend to proceed with an electronic AGM, we will assist to the best of our abilities, but we do not have the technical expertise or personnel in place to ensure that these meetings run smoothly. As always, you can expect to rely on us to provide excellent advice with respect to Strata Corporation governance but we want to confirm that we are not qualified to provide technical advice.  CHOA has published several resources for Strata Corporations considering electronic General Meetings such as this article (which raises many questions about technical aspects, but not many answers) and this archived seminar along with presentation materials they prepared on the subject. We will continue to provide resources as they become available;

• • Hearings & Observers – Our friends at Clark Wilson published this helpful article which touches on many of the concerns above about General Meetings, but also discusses some of the implications of holding Council meetings online.  Observers, for example, should still be permitted to attend in the same manner as before (but perhaps consider the use of the “mute” button and turning off their camera).  Hearings can be conducted electronically as well, and your Property Manager can simply share the meeting invitation with prospective attendees to allow this to occur.  As administrator for the meeting, the PM can then remove the individual(s) to the “Waiting Room” for portions of the meeting they are not permitted to attend as observers.  Several hearings have already been conducted in this manner and it does work well, so Councils should feel confident when this sort of request comes up that it can be handled in largely the same manner as before COVID-19 moved meetings online.  One additional option Councils can consider when permitting observers is to require them to use the “dial-in” function, rather than video- this would ensure that Council members personal privacy is protected ie. observers cannot see Council members homes.

Thank you for taking the time to review this information and again for all of your hard work on behalf of your Strata Corporations.