A guide for strata council in British Columbia

Serving your community is always a rewarding experience. There are many good reasons why you should serve on your strata council – whether you want to be actively involved in the decision-making process, contribute your experience and knowledge or whether you affect change in your complex.

If you are living in a condominium or townhouse complex with multiple owners, there will be a strata organization. The strata organization is governed by strata council and is managed generally by a strata management company. While most strata are managed by a strata management company, some strata can also opt for self-management. The rules of strata is governed under the Strata Property Act.

Terminology

To understand how strata works, it’s generally a good idea to understand terminology associated with it.

The strata corporation is the organization of the lots within the complex.
The strata lot in a strata complex is the space designed or intended to be used primarily as a residence.
The strata council is the executive and the directors on the strata corporation, elected by strata lots and their proxies.
The strata manager (or “community manager”) is the representative from the strata management company, which has a contractual obligation to operate under the direction of the strata council.
Common property refers to land/space not within a strata lot, usually intended for use by multiple strata owners (such as a playground, road, underground garage).
Limited common property refers to land/space not within a strata lot, usually intended for exclusive use by one or more strata lots (such as your backyard, driveway).

The Strata Council

The strata council is usually comprised of owners elected by their peers to give the strata management direction in respect to the day-to-day operations including financial management and rules enforcement and has the powers to make decision on behalf of the strata corporation. A tenant or representative may be elected onto strata council if a strata lot owner agrees.

According to the Strata Property Act, the strata council is responsible for managing and maintaining the common property and common assets of the strata corporation for the benefit of the owners and all powers and duties of the strata corporation must be exercised and performed by a council.

The strata council is elected at the Annual General Meeting (AGM). Depending on the size of the strata, the size of the strata council will fluctuate and is determined by the strata bylaws. Your strata council typically consists of the President, Vice-President, Treasurer, Secretary, Privacy Officer and members-at-large. The positions are typically determined after the AGM or at the first strata council meeting.

President – The head of the strata corporation. The president is responsible for ensuring the strata council is working in the best interests of the strata corporation and is responsible for ensuring that the strata council is abiding by the Strata Property Act. The President has special responsibilities, such as chairing meetings, holding the tie-breaking vote at meetings and acting as the liaison between council and the manager. While the President is on strata council, the President is typically the individual who chairs the meeting so the individual doesn’t actually vote unless there is a tie-breaking vote.
Vice-President – Acts when the President is unable to act, such as when the President is unable to show up to meetings.
Secretary – Taking meeting minutes and management of strata documents. Typically this role is done by the strata management company.
Treasurer – Review and understand the financial position of the strata corporation. This may also include accounts receivable and accounts payable. This role is typically done by the strata management company as well.
Privacy Officer – Required under the Personal Information Protection Act and is responsible for ensure that personal information is protected from unauthorized access, use, disclosure and loss.
Members-at-large – If your strata has more than five directors, they will serve as members-at-large, directors-at-large or a similar term. Members-at-large is responsible for representing their peers to strata council and casts votes, along with other executives to make decisions.

A strata council member may hold multiple positions, as long as they are not holding the President and Vice-President at the same time. This means that the President can serve also as the Treasurer or the Privacy Officer at the same time.

If you are moving into a new development, the strata council is formed typically when the developer turns over the development to the residents. There will be a strata management company assigned by the developer. The first event that typically happens after when the development gets turned over from the developer is the AGM to take care of housekeeping items. If you are moving into an existing development or if you are a later phase in an existing development, there might already be an existing strata council that you might be able to join.

Strata Management Company / Strata Managers

Strata managers are licensed in the Province of British Columbia with the BC Financial Services Authority (same provincial government authority that regulates mortgage advisors, real estate agents, and more). Strata managers must complete all course assignments, pass the licensing examination, obtain a criminal record check and join a real estate brokerage.

More often than not, your strata will have a contracted strata management company. Your strata management company helps your strata council manage the financials, administration and maintenance of your complex. All owners in a complex likely will come in contact with the strata management company, especially when paying the monthly strata dues.

While they manage the strata complex for the strata council, the strata council is still responsible for the decision-making. Depending on the experience of the strata council, typically the strata management company can offer their expertise to help strata council make a decision. This includes recommendations on landscaping or snow removal contracts or how much to budget for the upcoming fiscal year.

Annual General Meeting and Special General Meetings

An annual general meeting (AGM) is an annual meeting of the general membership of an organization and is the event where owners approve the budget for the coming fiscal year, elect a council and deal with any other business. Typically the AGM is organized by your strata management company and can be in person or virtual.

By law, an annual general meeting must be held no later than two months after the strata corporation’s fiscal year end (s. 40, Strata Property Act). Depending on your strata bylaws, there are requirements for the number of people required to show up at your AGM (called Quorum) — such as 1/2 or 2/3 of your strata complex. If an owner cannot make it to the AGM, they can give their vote to another owner or representative (such as a tenant) to show up to the meeting on their behalf (called Proxy).

Throughout the year, special general meetings (SGM) can be called by the strata president or by individuals within the strata holding at least 20% of the strata corporation’s vote by written demand (1 in 5 strata lots). Special general meetings can be called to make budgetary decisions (such as to pass special levies), consider resolutions or matters specified in the demand (i.e. to make changes to the strata management corporation). SGM must be called with at least two weeks of written notice. For an SGM, the rules of an AGM in regards to quorum still applies.

Strata Meetings

A strata meeting is when the directors get together at an organized meeting and discuss issues relating to the strata. Any strata council member can call a strata council meeting by giving other strata council members notice or if it’s already agreed upon at a preceding meeting. If the strata council has a strata management company, typically this meeting is organized by the strata management company. These meetings can be either online or in-person.

The President typically chairs the meeting (Vice-President if President is unable, or Strata Manager if President designates) and it would include the following items:

Calling the Meeting to Order – The start of the meeting as called by the President. Typically this happens as scheduled and when quorum has been reached (when both requirements have been met). [No vote required]
Adoption of the Agenda – The decision to agree to the list that will be discussed at the meeting [Vote required]
Adoption of the Previous Meeting Minutes – The decision where Council approves the previous Council meeting minutes by resolution [Vote Required]
Business Arising from the Minutes of the Previous Strata Council Meeting – An opportunity for strata council to discuss outstanding items from the previous meeting [No vote required]
Review of the Financial Statements for the Months Preceding – An opportunity for strata council to discuss the finances of the strata in the previous few months preceding the meeting, since the last meeting. This includes an opportunity for strata council to question the incurred expenses and to hold the strata executive or strata management responsible. This can also include outstanding items such as those in arrears (when they owe strata dues). [Vote Required]
Correspondence – A discussion of correspondence received from different strata lot owners or tenants, such as but not limited to requests to make adjustments to the limited common area or requests from residents to address deficiencies or areas that need to be worked on. [Vote required on if it’s financial]
New or Other Business – Any issues that relates to the strata, such as snow removal, landscaping, garbage and/or contracts, depending on what is needed or anticipated by strata council or strata managers. [Vote required only if it’s financial]
Date of Next Meeting – A discussion on when the next meeting should be held. [No vote required]
Termination of Meeting – When the President calls the meeting has concluded [Vote optional]

While serving on strata council is a privilege, it’s important to remember that strata council members must act honestly and in good faith with the best interests of the strata corporation (s. 31, Strata Property Act). If a strata council member is acting in good faith of the strata council, typically the strata bylaws protects the director from being personally liable. Typically any errors caused by a strata director is protected by the errors and omissions insurance policy.

When making decisions, it is important to know that strata council members must disclose any conflicts of interest where they or their family members may have a financial interest (s. 32, Strata Property Act). This excludes the member from being able to discuss and vote on any items under financial consideration. If someone on the strata council owns a snow removal company and snow removal contracts are being discussed, strata council might ask the individual for their expertise but they cannot vote and have to abstain on the matter.

Removal of / Changing Strata Management Company

It is important that you have constant communication with your strata management company. Most of the headaches experienced by strata council are due to the lack of communication between strata council and strata management.

The strata president (or someone on council) can call the strata manager and discuss various issues in between meetings, either by email, phone or text (if the strata manager permits). Typically if a council is not happy with the strata management company due to deadlines not being met or lack of communication, a strata council member can lay out expectations and metrics for problem solving.

If the strata council determines that there is no way to continue the relationship, the strata council should decide whether they want to self-manage or switch strata management companies. While self-manage seems easier, it is a lot of work and I have heard that it could make a complex not as valuable to investment buyers. If strata wants to switch strata management company, they will be required to do a bit of leg work. Please see below for a list of strata management companies in British Columbia.

Reaching out to companies for a quote

When you reach out to a strata management company, they will assign your strata to a strata manager. The strata manager will often speak to the representative on council to determine your needs. The strata manager, in order to provide strata with a quote, will require the age of the building (to determine the depreciation), size of the building, number of meetings per year (typically 4-6), type of strata (residential condo, residential townhouse, mix-use residential/commercial) and any ongoing or anticipated project. This is required in determine the fees associated with strata management. Bigger strata and/or older strata means more work, so more cost.

If you are a business owner or manager, you typically wouldn’t hire an employee over the phone or by email. The strata manager will often want to visit your site so that they can make recommendations on improvement and meet the council (or a representative). They often want to hear your expectations and they want to know what you are looking for.

Before you agree to anything with a strata manager, make sure you ask for a financial package and agency agreement. A financial package and agency agreement would outline the roles and responsibilities of the strata management company. This would also include the fees associated, as well as information on termination.

Termination of existing company

Whether your strata council has decide on self-management or a different management company, you will need to approach your current manager for termination. Depending on the age of your complex and your strata management company, there will be different clauses and steps that you are required to follow for termination, including termination fees if you cancel before the contract is complete.

In order to terminate your contract with your strata management company, you will need (a) 3/4 vote at an annual or special general meeting to give your two months notice, or (b) your strata management company to cancel with you with two months notice. Of course, it’s easier for your strata management company to initiate the cancellation, but it’s not going to be easy for them to let go of the contract. In order to call an AGM/SGM, you will need to give at least two weeks notice to all strata owners. Upon passing the vote with a 3/4 vote at the AGM/SGM to terminate the relationship can the strata corporation give the two months notice to the existing manager

Once you terminate with your existing company, you will then be able to ratify the new strata management company. This can typically be done at the AGM/SGM or by ratification by strata council. Your new strata manager should be able to guide you through this process.

If your strata is going to be self-managing, it’s important for your council to collect all the documents and financial keys (cheques, bank accounts) from your outgoing strata management company.

List of Strata Management Companies

A lot of people have approached me to ask me for recommendations for strata management companies. The needs of each strata and strata council varies, so it is hard to make recommendations. Furthermore, it is difficult to guarantee the standard of service you will receive between different strata managers within the same firm. Some firms will have multiple locations as well (ie in Vancouver, Surrey and Kelowna). If you have a friend or an associate who recommends a strata management company, make sure to reach out to that strata manager at the firm. If you are interested in making a change in strata management companies, make sure you reach out to the firm and properly interview the strata manager.

Please refer to the list below for some of the most popular strata companies. Please note that I am not affiliated with the companies below nor can I make any guarantees about the level of service that you will provide.

If you are a strata manager and would like your company listed on the list above, please contact me at [email protected].