Top 9 FAQs
Question 7. The owners are not happy with the current Board of Directors –
Do we have to wait until their terms are up in order to replace them?
Owners do not have to wait until the term of any Board member expires in order to remove and/or replace any director(s) of the Corporation. Section 46 of the Act provides that the owners of at least 15% of the total units are entitled to submit a Requisition (i.e. a petition) asking for the removal of one or more of the directors of the Corporation. These owners (the "Requisitionists") must be listed in the record of owners and mortgagees that the Corporation is required to maintain. These owners must also be entitled to vote, under the Act.
The Requisition itself must be in writing and must contain the following information regarding each director that the Requisitionists wish to remove: 1. the name of the director; 2. the reasons for the proposed removal; and 3. whether the director holds a position on the Board for which only an owner of an "owner-occupied unit" may vote. The Requisitionists must sign the Requisition. This means that the signature of each Requisitionist should be on the same page as (and typically below) the required written information (i.e. the above points 1 to 3) on the Requisition. If pages, containing only signatures of owners, are simply attached to a Requisition (in an attempt to achieve the required 15% signature threshold), the Requisition will likely be invalid.
The Requisition must be delivered personally or by registered mail to the President or Secretary of the Board of Directors, or it may be deposited at the address for service of the Corporation which can be found in the Declaration or in any registered Notice of Change of Address form (see s.108 of the Act). Upon receiving a valid Requisition, the Board of Directors has a duty to: (A) add the requested removal and possible replacement of the director(s) to the Agenda for the next Annual General Meeting, but only if the Requisitionists request this in the Requisition itself or otherwise consent to this in writing; or (B) otherwise, send a notice of meeting to the owners and hold a meeting of owners, to vote on the removal and possible replacement of the director(s), all within 35 calendar days of receiving the Requisition. If the Board does not comply with the above, a Requisitionist may call the meeting i.e. send the notice of meeting to the owners, and the meeting of owners must be held within 45 calendar days thereafter. Furthermore, any such Requisitionist is entitled to be reimbursed by the Corporation for the reasonable costs incurred in calling the meeting of owners. Regardless of who (i.e. the Board or a Requisitionist) calls the meeting, it is essential that the Agenda for the meeting clearly discloses that the owners will be voting on the removal and possible replacement of any director(s) that the Requisitionists wish to remove as per the Requisition.
The ability of owners to vote for the removal of directors before their terms expire, pursuant to the above-noted Requisition procedure, is an essential democratic right of the unit owners. As such, upon receipt of a valid Requisition, directors must always remember their duty to act honestly and in good faith in the manner in which they treat the Requisition. At the same time, owners should be aware that, under certain circumstances, repeated Requisitions for the removal of directors, over a short period of time, could be a factor leading to the appointment of an Administrator for the Corporation (see s. 131 of the Act)."