Removing Committee Members Part 2

Wednesday March 14th, 2018

Unless you’ve been living under a rock for the last 4 years, you would know that there is an extensive review of Queensland’s property laws going on. As we touched upon in our last article, a discussion paper has been released which deals with removing voting committee members.

To recap, there are currently two ways that you can remove a voting committee member. The first is simple; all that is required is to pass an ordinary resolution removing the committee member. The second method is to give the voting committee member a code of conduct contravention notice (authorised by ordinary resolution), to then give them a right of reply (which must be forwarded to all owners at the Body Corporate’s expense) and only then to remove them (by a further ordinary resolution). Understandably the second method is hardly used; it takes 2 separate general meetings.

There is a single, new method proposed in the discussion paper, which is intended to replace both of the current methods. The new method is as follows:

  • An ordinary resolution is proposed to remove the voting committee member;
  • After the agenda has been sent out which contains that motion, but before the general meeting is conducted, the committee member can circulate a statement to Lot owners;
  • At the meeting at which the motion is to be voted on, the committee member will have a right to speak; and
  • If the motion passes, the now removed committee member will have a right to lodge an application with the Commissioner for Body Corporate & Community Management to dispute the Body Corporate’s decision.

At this stage there is no indication of the grounds the voting committee member would need to establish to obtain an order to overturn the Body Corporate’s decision. If no specific grounds are detailed in the amending Act, then it is likely that the removed voting committee member would have to prove that the Body Corporate’s decision was unreasonable.

Likewise there is currently no guidance as to how defamatory material contained within the voting committee member’s right of reply would be addressed or how far the right to speak at the general meeting would extend.

It is likely that the protection of the Body Corporate and its committee from liability for defamation contained in section 111(A) will be made to apply to distribution of the voting committee member’s statement. That is, if the committee receives defamatory material, but must send it to owners because of a requirement of the Act, then the committee is not liable in defamation for doing so. Parliament will need to ensure however that the protection against defamation does not extend to the committee member writing the statement. If not, there is no doubt that the ‘right of reply’ will end up becoming a ‘licence to decry’… (everyone and anyone who wants the committee member removed).

As to the voting committee member’s right to speak at the general meeting, it is most likely that the Regulation Module will provide that the voting committee member must be given a “reasonable” opportunity to address the meeting. This is because if a maximum time limit was prescribed it is almost certain that every available minute would be used in every case. The maximum limit would also fail to address those (likely to be few) instances where the number and types of allegations being raised against the voting committee member would be such that even a basic response would take some time. Good drafting should also see that if there is a failure to provide that ‘reasonable’ opportunity to speak, the result (the removal of the committee member) is not impugned.

This article was contributed by Michael Kleinschmidt of Stratum Legal.