Drawn from the fall 2008 CondoLiaison bulletin.

Shorten co-owners' meetings
by eliminating unnecessary votes

by Me Yves Papineau

lawyer, PAPINEAU AVOCATS inc.

THE VOTE TAKEN TO RATIFY ACTS OF DIRECTORS

Nowadays, a vote ratifying all the acts of the directors for the previous year is often included on the agenda of the meeting.  How could the co-owners attending the meeting ratify those acts without any adequate knowledge?

A director cannot deny its responsibility for a damage he caused to a co-owner on the basis of a vote in a meeting.  Even if the assembly knows about the wrong doing, is it possible to clear a director of its responsibility towards a co-owner by taking a vote of whatever majority? The answer to this question is obviously no.  Then this vote has no valid reason to exist and should not appear on the agenda.

THE VOTE FOR THE ADOPTION OF FINANCIAL STATEMENTS

Another widespread practice in co-owners' meetings consists in taking a vote to adopt the financial statements.  Such an adoption process is unnecessary and unfounded. From the beginning, an expert accountant has prepared the financial statements according to the syndicate of co-ownership documents: bills, checks, deposits, etc...  Some of those financial statements were even verified by a chartered accountant who made sure that all documents were legitimate and done in conformity.  This verification process leads to the confection of audited financial statements.

How could the co-owners attending the meeting decide to adopt or reject an expert report, especially one like an audited financial statement? Could they reject an audited financial statement depicting the exact reality of their co-ownership? Once again, the answer to those two questions is obviously no.  It's unnecessary to list such a vote on the agenda, even if presenting the financial statements is mandatory and even if the financial statements must be sent along with the notice calling the annual general meeting.(art. 1087 C.c.Q.).

The presentation of the financial statements is not an occasion to challenge the relevance of the expenses either.  The financial statements must be presented, but without any kind of vote, since a vote would bear no real utility.