By Auren Freitas dos Santos
The intricacies of the STSM Act and the prescribed management rules can often seem like a labyrinth for most people dealing with body corporate governance. Among these complexities, the notice period for special and unanimous resolutions in body corporate meetings stands out as a commonly misunderstood aspect. Many are unaware that the seemingly mandatory 30-day notice period for such resolutions can, in fact, be significantly shortened, thanks to a provision hidden within the Act itself.
Understanding Section 6(2) of the STSM Act
Section 6(2) of the STSM Act explicitly stipulates that a body corporate must, at least 30 days prior to a meeting where a special or unanimous resolution will be considered, provide written notice to all its members, specifying the proposed resolution. This provision has traditionally been interpreted as an ironclad requirement, leading to the belief that a 30-day notice is non-negotiable.
However, the crucial phrase in section 6(2) often goes unnoticed: “except where the rules provide for shorter notice.” This subtle clause opens the door to the possibility of reducing the standard 30-day notice period, but how exactly can this be accomplished?
Prescribed Management Rule 15(7): A Hidden Power
The key to shortening the notice period lies in Prescribed Management Rule 15(7), a provision that is frequently overlooked but holds immense significance for body corporate meetings. It outlines the circumstances under which a general meeting for voting on a special or unanimous resolution may be called with less than the conventional 30-day notice:
- Urgency of the Matter:
The trustees have the authority to resolve that shorter notice is necessary due to the urgency of the issue at hand. In such cases, a meeting can be called with a notice period of just 7 days. However, it is imperative that the trustees clearly set out their reasons for this resolution. It’s worth noting that this provision cannot be applied to meetings referred to in rule 29(2) or (4).
- Unanimous Agreement:
The notice period can also be shortened with the unanimous agreement of all persons entitled to attend the meeting. In cases where all members provide written consent, the notice period can be reduced to less than 14 days.
Unlocking the Hidden Potential
This revelation should come as a shock to many in the property management industry. Often, the assumption has been that a 30-day notice period is obligatory for special and unanimous resolutions. However, by properly understanding and utilising Prescribed Management Rule 15(7), body corporates can expedite decision-making processes when time is of the essence.
This provision can be particularly valuable in situations where swift action is required to address pressing issues, such as emergency repairs, critical financial decisions, or immediate security concerns. Trustees can make use of this provision, provided they can justify the urgency of the matter, while unanimous agreement can be sought for any issue where all members are aligned on the need for a quicker decision.
In conclusion, the STSM Act does indeed offer flexibility when it comes to the notice period for special and unanimous resolutions in body corporate meetings. By taking advantage of the provisions within Prescribed Management Rule 15(7), trustees and members can streamline the decision-making process and respond promptly to the evolving needs of their community scheme, ultimately enhancing the efficiency and effectiveness of body corporate governance.
Specialist Community Scheme Attorney (LLB, LLM), Auren Freitas dos Santos, is a Director of The Advisory, a boutique consultancy specialising exclusively in community schemes law.
Contact him at www.theadvisory.co.za or email info@theadvisory.co.za for assistance with any matters relating to sectional title meetings.
