Types of resolutions

Ordinary resolutions

An ordinary resolution is one passed at a properly convened meeting of the corporation by a simple majority of the votes of unit holders present and voting on the resolution [s 3(1) Strata Titles Act 1988 (SA)]. Decisions of a strata corporation are made by ordinary resolution unless the Act or articles specify otherwise.

Special resolutions

Special resolutions must be proposed by at least 14 days written notice to all unit holders, including the terms of the proposed resolution and the reasons for the proposed resolution [s 3(1)(a)].

A special resolution is required to:

  • change or adopt new articles [s 19(2)];
  • authorise the erection, alteration, demolition or removal of a building or structure, or authorise changes to the external appearance of a building by a unit holder [s 29(1)(b)], unless all the units in the strata scheme are non-residential premises, when the articles of the strata corporation may allow such changes to be made [s 29(1)(a)]; and
  • approve any special insurance [s 31(3)].

When there are only two units

When there are only two units, both unit holders must agree to achieve a special resolution [s 3(1)(b)].

When there are three units

When there are three units and the owner of each unit is entitled to 1 vote (as is the case for all residential strata corporations), a special resolution is achieved if the resolution is passed at a properly convened meeting of the strata corporation at which either no vote, or only 1 vote, is cast against the resolution [s 3(1)(b)].

If the corporation has three units that are all non-residential and the number of votes exercisable in respect of each unit is equivalent to the unit entitlement of the unit [see s 34(2)], then a special resolution is achieved if the resolution is passed at a properly convened meeting of the strata corporation at which the number of votes (if any) cast against the resolution is 25% or less of the total number of votes that could be cast at a meeting at which all unit holders are present and entitled to vote [s 3(1)(b)].

When there are four or more units

When there are four or more units, a special resolution is achieved if the resolution is passed at a properly convened meeting of the strata corporation and the number of votes (if any) cast against the resolution is 25% or less of the total number of votes that could be cast at a meeting at which all unit holders are present and entitled to vote [s 3(1)(b)].

Example 1: If the number of units is 12 and 8 unit holders are present at the meeting:

If the number of units is 12,

then:  the total number of votes that could be cast at a meeting at which all unit holders are present and entitled to vote is 12

and:    25% of 12 = 3

thus:   for the resolution to pass, only 3 votes may be cast against it.

Assuming the meeting has been validly called and 8 of the 12 unit holders are present,

then:  a majority vote is required for the motion to pass, and the motion fails if 4 vote against it.

result of vote against for abstain
Pass

0

1

2

3

3

8

7

6

5

4

0

0

0

0

1

Fail

3*

4

3

4

2

0

* Although only 3 votes were cast against the motion, 3:3 is not enough to pass the motion.

Unanimous resolutions

A unanimous resolution is the same as a special resolution but passed without any dissenting vote, that is nobody must vote against the resolution. Any unit holder who does not attend (or send a proxy to vote), or attends and chooses not to vote, is not counted as a dissenting vote.

Unanimous resolutions are required when:

  • acquiring, dealing with or disposing of real property [s 26(3)];
  • granting to a unit holder exclusive use of part of the common property for a specified period [s 26(4)];
  • distributing surplus funds from the sale of land [s 26(6)];
  • determining contributions other than on the basis of unit entitlement [s 27(3)];
  • varying the voting rights in non-residential schemes from one vote per unit to a system where the number of votes exercisable in respect of each unit is equivalent to the unit entitlement of the unit [s 34(2)];
  • permitting a residential unit holder to grant a lease or license over part of the unit to someone other than another unit holder (but no authorisation is required in relation to a lease or licence over the whole of a unit) [s 44(2)(b)];
  • amending the strata plan [s 12]; and
  • amalgamating with another adjacent strata plan [s 16].

Note that, although a special resolution is required to make alterations or additions to a unit, a unanimous resolution is required if the alterations affect the boundaries of a unit or the common property. Any changes to unit or common property boundaries must be ratified in an amendment to the strata plan.

when a unanimous resolution is not obtained

Where a unanimous resolution is necessary but is not obtained, but the resolution is supported to the extent necessary for a special resolution, then a person included in the majority in favour of the resolution may apply to the Magistrates Court or the Supreme Court to have the resolution declared sufficient to authorise the particular act proposed [s 46].

Notice of an application to convert a special resolution to a unanimous resolution must be served on every person who was entitled to vote and did not, either in person or by proxy, vote in favour of the resolution. The court may also order that any other person the court declares to have a sufficient interest in the proceedings be served with notice of the application. The court may direct that any such persons be joined as a party to the proceedings [s 46].

Types of resolutions  :  Last Revised: Fri Jan 24th 2014
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