Board, Vacancy in

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Board, Vacancy in / Quorum, loss of (on Board)

Also see: Board of Directors; Quorum

Short Answer

Other than in regard to the declarant's appointed board, when a vacancy occurs in the board of directors, the remaining members constituting a quorum can appoint a replacement if wanted. If the remaining directors do not constitute a quorum, a meeting of owners must be called for the purpose of electing new directors to fill the vacant position(s).

Definition

Condominium board members are volunteers. They may resign before completion of their term. They could also cease to qualify to be on the board (see the Condopædia article on Board of Directors for a discussion of qualifications). There are three ways of dealing with such vacancies arising on the board:

The remaining board members, if they constitute a quorum* of the board, can appoint a replacement by majority vote of the remaining directors. The replacement assumes the position of the vacating director until the next annual general meeting. If the vacating director's term would have extended beyond that meeting, then at that meeting the owners shall elect someone to hold the position until the end of the term. The person appointed by the board can stand as a candidate for that position. If the position in question was that of the "owner-occupied director" only the owners of owner-occupied units can elect the replacement director. (See the Condopædia article, Owner-Occupied Director.)
The remaining board members, if they constitute a quorum*, can choose not to appoint a replacement and may continue to exercise the powers of the board so long as a quorum remains in office. If this is the case, then at the next annual general meeting the owners shall elect someone to hold the position until the end of the term. If the position in question was that of the "owner-occupied director" only the owners of owner-occupied units can elect the replacement director.
If the remaining board members do not constitute a quorum* of the board, they are required to call and hold a meeting of owners within 30 days of losing quorum, for the purpose of electing new directors to fill the vacancies. Although the remaining board members remain directors of the board, because they lack quorum they lack authority to do anything other than call the election in question. Since this is the case, and since the meeting must be both called and held within 30 days, and notice of meeting must be at least 15 days and should ideally be preceded by a "call for nominations" the remaining board members should with all haste when this situation arises.

*For a discussion of what constitutes a quorum of the board, see the Condopædia article, Quorum.

The foregoing provisions do not apply if the vacancy is caused solely by an increase in the number of positions on the board. In such case, the vacancy can only be filled by election at a meeting of owners duly called for that purpose and the replacement director shall not have authority to act until the by-law increasing the number of directors is registered in accordance with section 56 of the Act. (See the Condopædia article, By-laws, for a discussion of the procedure by which condominium by-laws are enacted.)

None of the foregoing needs to be considered in relation to the declarant's appointed board of directors. See below.

What you need to know…

…as a Unit Owner

In most condominiums, unit owners are the primary pool of potential directors and generally should be willing and prepared to take their turns serving on the board. Vacancies arising on condominium boards generally do not cause significant problems if there are a sufficient number of people willing to serve.

…as a Board Member or Manager

Board members should not make new decisions once it is determined that a quorum of the board has been lost due to vacancy(-ies). Managers should not attempt to "step into the breach" by making decisions the board is no longer able to make. Decisions that were duly authorized by the board prior to the loss of quorum may continue to be carried out by the person(s) authorized to do them.

Board members and managers should cultivate a sense of community concern and volunteerism amongst the unit owners and other qualified candidates for board membership.

…as a Declarant

Within 10 days of the creation of a condominium corporation, the declarant must appoint a board of directors. The declarant is thereafter entitled to revoke any appointment and appoint a replacement. The declarant's appointed board holds office until a new board is elected by the unit owners at the Turn-over Meeting.

The declarant should not allow its appointed board to lose quorum. If a director resigns, the declarant should forthwith appoint a replacement to ensure there are always 3 directors, or a minimum of 2 (a quorum) if necessary, serving on the board.

The Act provides that by the later of (a) 90 days after the declarant sells the first unit and (b) 30 days after the declarant has sold 20% of the units, and if the conditions for Turn-over do not yet exist, the unit owners shall be entitled to elect two directors to the board. The Act does not appear to provide any specific guidance on what should occur in the event one of these two directors resigns or ceases to qualify. Presumably the same rules as set out above in this article could apply, however it is not clear whether the addition of these two directors necessarily increases the quorum requirements for the board, and therefore it is not clear whether their resignations or disqualification would impact quorum provided the declarant's appointed board remains in office. Whatever one thinks should in fairness occur, it would require legislative or judicial intervention to be determined with certainty.