How Many Proxy Votes Can One Person Have?
In a strata scheme, each lot owner is generally allotted a number of votes according to the share of property owned. Under the Strata Titles Act 1988 and the Community Titles Act 1996 in South Australia, every unit is entitled to one vote, regardless of the size of the lot.
Proxy voting allows strata owners to transfer a vote to another party, enabling the party to act on behalf of the owner during annual general meetings (AGMs), special general meetings, and management committee meetings.
According to strata regulations in South Australia, there is no limit to how many proxy votes one person can hold. A nominated individual can possess any number of proxy votes, even if the number of votes would reach a quorum.
This differs from other states like New South Wales and Victoria, where individuals cannot hold proxies for more than 5% of the total number of lots.
Who Can Hold a Proxy Vote?
For annual and special general meetings, strata owners can nominate anyone they trust to vote on their behalf. This includes family members and friends (even if they do not reside in the property), tenants, lawyers, strata managers, or other strata owners, such as a neighbour. The flexibility for nomination also applies to committee meetings of strata schemes with no residential lots.
In the case of committee meetings for residential strata, only other owners can be nominated as a proxy.
Exceptions and Limitations for Proxy Voting in South Australia
Time Period
Proxy nomination is only valid for 12 months from the date of appointment. After this period, the vote automatically returns to the owner. This safeguard prevents proxy holders from maintaining control over a scheme and allows owners to reassess how their interests are being represented.
Proxy Override
Owners can revoke proxy at any time by notifying the Secretary of the committee. Owners can also override appointment proxies by attending the meeting themselves.
Conflict of Interest
If the subject of the vote is of financial interest to the proxy holder or the owner, it must disclose it to the meeting before voting. Failure to disclose financial interest in a vote carried a maximum penalty of $15,000.
If the proxy holder has a personal financial interest in matter, they must also disclose that interest to the person who nominated them before voting occurs.
How to Nominate Someone as a Proxy
To ensure a proxy is legally recognised during a strata meeting, owners must ensure the following:
- Complete a nomination form
The proxy nomination must be made in writing. Forms between each strata differ in structure, but must clearly indicate the owner, the person being nominated as the proxy, and the specific lot number in the strata. The form must then be signed and dated by the owner.
Owners can choose how the proxy is entitled to vote on their behalf – the proxy can either be given the freedom to vote as they see fit on matters, or be given explicit instructions on how to vote regarding certain motions on the meeting agenda. When special instructions are given, proxies are legally bound to act in accordance. If the proxy votes in contradiction to the given instructions, the vote can be considered legally invalid.
- Submit the form
The completed form must be provided to the Secretary of the strata corporation or the strata manager. While it can often be handed over at the start of a meeting, many corporations request submission 24 to 48 hours in advance to allow the chairperson to verify the roll and determine if a quorum has been met.
- Verification
The chairperson of the meeting is responsible for checking that all proxies are valid and have not expired (within the 12-month limit). Once verified, the proxy holder is entitled to collect the appropriate number of voting papers or participate in a show of hands on behalf of the owners they represent.
What Happens if the Proxy Votes Against My Interests?
As mentioned, the vote will be deemed legally invalid if it was cast in contradiction to the owner’s given instructions.
But what about if the proxy was given freedom to choose?
In the case where the owner provided a general proxy (allowing the nominated person to vote as they see fit), the vote will remain legally valid and binding even if the owner disagrees with it. The strata corporation recognises the validity of the proxy nomination and the vote cast as the official stance of the lot.
Owners can protect their interests and prevent this from happening by:
- Nominating only trusted individuals – general proxies offer discretionary power to the holder. Owners should only entrust people they trust or those with aligned interests.
- Providing special instructions on how to vote for specific issues. Owners can either explicitly state their voting preference on the form, or include notes on the form that limit the proxy’s discretion to certain types of motions.
Miscommunication and improper nominations can cause proxy voting to be a source of dispute between owners and other stakeholders. Strata management services are often engaged to ensure compliance for voting processes during meetings.
Strata Data offers strata management services in South Australia to mitigate the risks of proxy voting and ensure all owners in the community have their interests fairly represented. Our team leverages over 40 years of experience in the body corporate services industry to deliver solutions for strata communities.
