The End Of Proxy Wars? 

March, 2017 - Jennifer Chia

Have you ever fought in a war? Chances are, you have. Participated in a proxy war that is.

Harassing and coercing are some common tactics used in the attempt to obtain as many proxies as possible to wrest majority control. There has even been a situation where an individual held 250 proxies – effectively being able to make every decision solely.1 An owner may attend a condominium meeting thinking that he had a fair chance of his voice being heard, that each person in attendance had an equal voice and an equal vote. However, the hard truth is that in proxy wars, there is no such thing as equality and democracy. Such is the reality of a proxy war.

Currently, persons with a large number of proxies can push for their own agenda and elect themselves into the council of the management corporation. In 2008, there was uproar at Mandarin Gardens as the enbloc sales committee collected enough proxy votes to push through resolutions deemed unfavourable to the estate and leaving the condominium without a Management Committee as they quit and refused to be re-elected.2 In 2012, it was reported that a property agent collected more than 50 proxy votes and voted in three property agent associates before making himself chairman of the management council.3 In 2013, reports surfaced that at The Sail @ Marina Bay, an extraordinary general meeting convened to remove three property agents who had elected themselves as council members and allegedly misused their powers to further their careers failed to pass, as together, the three property agents had held more than 60% of the proxy votes.4

But such tyranny may soon come to an end. The Building and Construction Authority (BCA) has announced that it is proposing to limit the number of proxies that one can hold. The proposed limit is set at 2% of the total number of lots in the development or 2 proxies, whichever is higher.5 This would mean that no one individual would be able to abuse the system and effectively control decisions made at the general meeting. Further, to prevent one from unintentionally obtaining proxies in excess of the limit, it has been proposed that the prescribed proxy form be revised such that the signature of both the proxy giver and holder is necessary.6 As such, the duty is on the proxy holder to ensure that he does not exceed the cap. In addition, meeting minutes must now include a list of proxies present at the meeting.7

These amendments have been long-awaited and are certainly welcome. The strengthening of this regulation will ensure that there is no huge discrepancy in voting power amongst individuals. If a subsidiary proprietor wants its voice heard, he can vote at a general meeting, with the assurance that no individual can single-handedly dictate proceedings. The silent majority, whose votes were once held by proxy holders, may now have their views heard. The requirements imposed on proxy forms and meeting minutes ensures better transparency and accountability of the proxy giver and the Management Corporation.8

However, as with all changes, there are its downsides. It may be more difficult for a subsidiary proprietor who is unable to attend meetings to find someone to hold his proxy. There is a possibility that the requisite quorum may not be able to be met and amendments may not be able to be passed. Further, it is still possible for the system to be abused, as a number of people with proxies who form a group can still wield significant influence.

Granted, these issues are unwanted. However, the benefits that the proposed amendments bring strongly outweigh the perceived drawbacks. Proxy holders can no longer make a mockery out of the rest of the subsidiary proprietors.  The proposed amendments has made it more challenging to exploit the loopholes in the system. Although there is a real possibility that there is absence of a quorum and resolutions cannot be passed, measures such as postal/online voting can be implemented for subsidiary proprietors who are resident overseas and are unable to attend the meeting. The minor concerns that have been raised pale in comparison to the unfairness and injustice of the past. The silent majority can finally find its voice. And perhaps in time to come, proxy wars will become a thing of the past.



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