Query on voting rights for members in MUD

emmavic

Hi all,

Just wondering whether anyone can clarify as to whether members of a management company in a MUD can vote for or against a budget when it hasn't been changed since the previous year?

To clarify, out AGM is in the next couple of weeks and our Directors and Agents are telling us that we don't get to vote on service charges and budgets as they are remaining the same as last year.

Thanks

Paulw

The budget must be voted upon at the AGM, changes or no changes.

emmavic

Thanks so much for that. I have one more question, hopefully someone can help. Under the MUD Act voting rights are one member, one vote. What happens if the Developer still owns a significant number of units, e.g. a 70:30 ration - does this mean that no matter what residents do, until that ratio reduces the Developer will still essentially have the casting vote?

Lantus

emmavic wrote: »

Thanks so much for that. I have one more question, hopefully someone can help. Under the MUD Act voting rights are one member, one vote. What happens if the Developer still owns a significant number of units, e.g. a 70:30 ration - does this mean that no matter what residents do, until that ratio reduces the Developer will still essentially have the casting vote?

voting rights under the MUD act still allow majority holdings. You need to check your articles of association available on the CRO for a few quid and see what they say.

They may also curtail the voting rights of non paying members.

However, under the MUD act the developer needs to of paid the service charge even if the unit is unsold so they may well have no votes.

Does the ratio mean that there are 70% commercial units to houses or just that they still own 70% of the commerical units?

emmavic

Lantus wrote: »

voting rights under the MUD act still allow majority holdings. You need to check your articles of association available on the CRO for a few quid and see what they say.

They may also curtail the voting rights of non paying members.

However, under the MUD act the developer needs to of paid the service charge even if the unit is unsold so they may well have no votes.

Does the ratio mean that there are 70% commercial units to houses or just that they still own 70% of the commerical units?

There are no commercial units in our company, it is all residential, however our development as a whole would have commercial units (there are four companies in the development). 70% was an example number, the reality is that the Builders Company own 85 units (some occupied, some not) and 3 units that are in the names of those that own the compay. There are 200 units in the company in total, but some of these are owned by the Council.

We are hoping to get a resident elected to the Board of Directors, but we have a feeling that this will not suit the developer as they have a real vested interest still. We know, from previous AGMs, that only about 20% of the residents who are entitled to vote turn up and/or send a proxy.

So, given that we will have about 20-30 residents or proxy's at the AGM, essentially the builders can still out-vote us because they have 88 votes?

They have paid their service charge, or at least the Budgets are saying they have paid their service charge...

Lantus

emmavic wrote: »

There are no commercial units in our company, it is all residential, however our development as a whole would have commercial units (there are four companies in the development). 70% was an example number, the reality is that the Builders Company own 85 units (some occupied, some not) and 3 units that are in the names of those that own the compay. There are 200 units in the company in total, but some of these are owned by the Council.

We are hoping to get a resident elected to the Board of Directors, but we have a feeling that this will not suit the developer as they have a real vested interest still. We know, from previous AGMs, that only about 20% of the residents who are entitled to vote turn up and/or send a proxy.

So, given that we will have about 20-30 residents or proxy's at the AGM, essentially the builders can still out-vote us because they have 88 votes?

They have paid their service charge, or at least the Budgets are saying they have paid their service charge...

Check your articles of association to what the voting rights are. It May say something like one member one vote. This may help but you may wnt to get some legal advice on this.

So out of 200 units you are saying that 85 are the developer and some are the council? Are these unsold units they still have?

In terms of voting all you can do is rally as many people as possible to your cause. If the estate is unfinished you may be able to question whether you should be paying any service fee at all.

Have the common areas been transferred to the OMC are does the developer still own them? Check the deeds.

In terms of the service charges the developer believed he his paying I would request all bank records and deposit slips that prove tey have paid. You might also want to contact the auditor and ask them a few questions.

Our auditor told us everything was fine but when quizzed admitted only seeing a fraction of the accounts.