By Ané de Klerk
If you have ever served on a body corporate’s board of trustees you will know that trustees meetings are where the action is. These meetings, scheduled from time to time as necessary, serve as the forum for discussing important issues related to the scheme and its various roleplayers and making decisions regarding body corporate business.
While trustees’ attendance at these meetings is vital, and their willingness to sacrifice their spare time to attend them nothing short of admirable, it is also important to note that trustees are legally obliged to excuse themselves from any part of a trustee meeting during which:
1. A matter in which they have a direct or indirect personal interest is being considered by the other trustees.
This means that the trustee may not be present when the other trustees discuss any matter that relates to them, or is likely to affect them, their immediate family and/or their financial wellbeing. An example of a matter in which a trustee has a direct personal interest would be the consideration of their application to keep two dogs in their section and exclusive use garden area; while an example of a matter in which they have an indirect personal interest would be the consideration of the trustee’s husband’s company to be appointed to provide gardening services to the scheme.
2. The trustees make their decision regarding the matter in which the trustee has a direct or indirect personal interest.
This means that the trustee in question cannot be present while the trustees cast their votes for or against a proposed trustee resolution to approve the keeping of the dogs or to appoint the trustee’s husband’s company to provide gardening services to the scheme.
Sometimes excusing themselves may entail stepping out of a meeting only for a particular agenda item (and returning when that item has been dealt with in full by the remainder of the trustees) and other times it may mean not attending a meeting altogether, if that particular trustee meeting was called for the sole purpose of discussing the matter in which the trustee has a direct or indirect interest.
Trustees are not the only people who have this obligation to excuse themselves from certain parts of trustee meetings however. Managing agents in attendance must also excuse themselves from these meetings (or parts thereof) in certain circumstances. These are:
1. When the trustees discuss contraventions of the Sectional Titles Schemes Management Act.
This means that a managing agent has to excuse themselves when the trustees discuss a potential breach of fiduciary duties by another trustee or an owner’s failure to maintain their section, for example.
2. When the trustees discuss contraventions of the body corporate’s Conduct or Management Rules.
A managing agent must therefore excuse themselves when trustees discuss a tenant who parked their car on the common property without the trustees’ consent or an owner’s failure to pay the body corporate’s legal fees incurred in the collection of their arrear levies, for example.
3. When the trustees resolve that their presence would unreasonably interfere with the body corporate’s interests.
The trustees could reasonably come to this decision when they wish to discuss the terms of the managing agent’s contract or the cost of their services, for example.
4. When the trustees resolve that their presence would unreasonably interfere with someone’s privacy.
For example, this could be the case when an owner has requested to discuss a sensitive matter of a personal nature, such as needing to keep an assistance dog due to a disability, with the trustees at their meeting.
From the examples above one can see that, while trustees and managing agents’ attendance at trustees meetings are welcomed and encouraged, one must also be mindful of the circumstances in which attendance is prohibited by law.
Learned something new while reading this article? Why stop now? Learn all you can about trustee and other meetings, body corporate finances, rules and more by completing our UCT Sectional Titles Schemes Management online course from the comfort of your home. Contact us at courses@theadvisory.co.za or visit our website to find out more.
Specialist Community Scheme Attorney (BA, LLB), Ané de Klerk, is a Director of The Advisory, a boutique consultancy specialising exclusively in community schemes law. Her focus is legal education, which includes presenting seminars and running online and in-person training programs and courses. You can reach out to her via email at info@theadvisory.co.za to request an obligation-free quotation for assistance with your scheme’s meetings.
I would have appreciated more of an explanation as to which section / regulation / authority says that the managing agent should not be present when certain matters are discussed by the trustees e.g. that an owner is not maintaining his section. The very nature of a managing agent is that they give advice on these matters to the trustees? The managing agent will also be the one directing correspondence to the relevant owner. Also, why can a managing agent not be present when it is discussed that an owner possibly contravened the rules? The notice to the owner will in any event be sent by the managing agent?