A Guide for Board Members
Board members are elected officers of condominium corporations; however, these are not for-life positions. Condominium corporations typically have three to five board members (though exceptions do exist), who are elected by unit owners, usually for terms of one to five years.
There are two typical ways of leaving the board:
By serving the entirety of the term, and by either not running or not being elected to a new term at the AGM
By resigning the position
Resignations are not uncommon and occur for a wide variety of reasons: ill health, loss of interest, other responsibilities, or when a board member sells their unit. Though a board member who sells their unit is not legally obligated to resign, many choose to do so.
Questions to Consider
Regardless of the reason for resignation, the remaining board members have to face some decisions. When advising a board who has just experienced a resignation, we suggest the consideration of two questions:
Does the board still have quorum?
For a board to have quorum, it must maintain a majority of board seats filled. For a 3-seat board, 2 seats must be filled. For a 5-seat board, 3 seats must be filled, etc.
If a three-seat board experiences a resignation and has 2 board members leave, it has quorum, and the remaining two directors can continue operating and making decisions. However, there may be issues with workload (if the board has lots of items going on, or if the corporation is self-managed), and of course an even number of board members can lead to issues if the board members find themselves deadlocked on opposite sides of a vote. For these reasons, a board may choose to appoint a new member, as the following discusses.
If a three-seat board experiences a resignation and is left with one occupied seat, the board has lost quorum, and can no longer make decisions. In fact, the only action this board member can perform is to hold an election.
Does the board still have an authorized cheque signer?
Different boards and managers have different cheque signature protocols. One of the most usual is that a cheque above a certain dollar figure requires two signatures*, one manager, and one from the board. Due to logistics of setting up signatures at the bank, boards often set up one member as cheque signer – typically the Treasurer or President. If this board member resigns, the board cannot sign cheques and pay bills. Normally, setting up a new signature at the bank takes several weeks – the delay being caused entirely by the bank.
* Utility payments are a common exception that typically only require the manager.
If the board experiences a resignation but still has quorum, and still has a cheque signer, often no action is required.
Appointing a New Board Member
If a board has quorum and has a vacancy, it can appoint a new board member. This is done through motion and vote at a board meeting. This new board member begins serving immediately and is a full voting board member despite not having been elected to the board. This board member serves until the next AGM. At this time, they automatically cease being a board member and the seat is up for election.
Despite a procedure existing for appointing a board member, this is not done in every situation. Often the remaining board has been working well together for some time, and the additional work of bringing in and onboarding a new board member is a lot of work for a board member who might only stay on for a few months.
If a board member is not appointed, the vacant seat is automatically up for election at the next AGM.
Written by Michael Trendota*, RCM
Chief Operating Officer of Alwington Communities
Michael is a property management professional with experience operating a diverse set of buildings, including high-rise, low-rise, and townhouse-style. His passion is bringing neighbors together to build exciting and vibrant communities. Michael draws from his own condo board member experience to advise board members on the opportunities and challenges facing their communities. Michael holds a Masters of Business Administration from Queen’s University and is a Certified Property Manager.
* Though written by a qualified and experienced Condominium Manager, this article is not intended as legal advice. Please consult your own experts for advice.
