How do Bodies Corporate Operate in Response to Covid-19?

How do Bodies Corporate Operate in Response to Covid-19?

Under Section 89 of the Unit Titles Act 2010 (“the Act”) bodies corporate are required to hold an annual general meeting ("AGM") within 15 months of the last AGM.  An extraordinary general meeting ("EGM") is required to be held when requested by more than 25% of unit owners or when necessary business is required to be completed under Section 89A of the Act.  Current Covid-19 restrictions will limit bodies corporate from convening physical meetings of owners consistent with obligations under the Health and Safety at Work Act 2015 which requires bodies corporate to take all practicable steps to ensure the health and safety of any person attending body corporate meetings.

Available Options

Pursuant to the current Regulations, there are a number of options available to bodies corporate who need to call an AGM/EGM, or otherwise to conduct business where appropriate resolutions are required including:

(a) Delaying the AGM as long as it is called within the 15 month period where no immediate resolutions are required and the body corporate has sufficient funds to operate in the medium term;

(b) Using postal resolutions for non-contentious matters; and

(c) Where the majority of owners are cooperating, the use of proxies or postal votes to limit attendee numbers at body corporate meetings where small gatherings are permitted by Government directive, and in order to meet quorum requirements under the Act.

The use of electronic meeting media may also be an option, particularly where small bodies corporate are involved.

Other Operational Issues for Bodies Corporate

  • Necessary Maintenance and Interior/Exterior Improvement Work to Units - Only essential and urgent work should be carried out in accordance with Government guidelines, with all visitor information for contractors to be properly recorded for follow-up should the body corporate be notified of any contracted Covid-19 cases later on.
  • Resident Visitors and Guests - Similarly, we recommend that unit owners stay calm and remain patient regarding interaction with other owners and their visitors and guests.  During the lockdown period it is imperative that owners comply with Ministry of Health and NZ Police guidelines, including prohibiting entry of visitors during the lock down period if necessary.
  • Payment of Body Corporate Levies - For commercial unit owners whose income is reduced or ceases thereby adversely affecting their ability to pay levies, immediate contact should be made with the Building Manager or Committee and an acceptable solution reached that will have the least impact possible for the body corporate.  Generally, owner cooperation will be more critical than ever in the current lock down to avoid bodies corporate becoming dysfunctional, and a possible application having to be made under Section 141 of the Act to appoint an administrator, where that dysfunction effectively stops the body corporate from operating.  Administrator appointments can be made on limited terms and for specific periods where required, including in the present situation, for the period of the current or any extended lock down.

Get in Touch

Please get in touch for advice on any upcoming body corporate meeting or in relation to any of the other topics covered by this article in more detail.

City and Manukau Offices:

John Burley at jburley@mcveaghfleming.co.nz | Dong-on Lee at dlee@mcveaghfleming.co.nz.

Albany and Manukau Offices:

Tracie Waterhouse at twaterhouse@mcveaghfleming.co.nz.

We are working remotely and can schedule a meeting with you via Zoom, WhatsApp or telephone.

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© McVeagh Fleming 2020

This article is published for general information purposes only.  Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice.  If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice.