The syndicate manages the collectivity through its board of directors, according to article 1084 of the Civil Code of Quebec, which provides:
“1084. The composition of the board of directors of the syndicate, the mode of appointment, replacement and remuneration of the directors as well as the other terms and conditions of their office are fixed in the by-laws of the immovable.
The court, upon application by a co-owner, may appoint or replace a director and fix the terms and conditions of his office if there is no provision therefor in the by-laws or if it is impossible to proceed in the manner prescribed therein.”
Obviously, it is the co-owners who elect the members of the board of directors, not the syndicate. Generally, all of this is done at the annual assemblies.
However, the law states that a co-owner who, for more than three months, has not paid his share of the common expenses is not eligible to be a member of the board of directors.
For the sake of efficiency, article 1085 of the Civil Code allows the appointment of a manager for the day-to-day administration of the community’s affairs.
What are the obligations of a director?
Briefly, the Civil Code states the following:
“322. A director shall act with prudence and diligence.
He shall also act with honesty and loyalty in the interest of the legal person.”
“323. No director may mingle the property of the legal person with his own property nor may he use for his own profit or that of a third person any property of the legal person or any information he obtains by reason of his duties, unless he is authorized to do so by the members of the legal person.”
“324. A director shall avoid placing himself in any situation where his personal interest would be in conflict with his obligations as a director.
A director shall declare to the legal person any interest he has in an enterprise or association that may place him in a situation of conflict of interest and of any right he may set up against it, indicating their nature and value, where applicable. The declaration of interest is recorded in the minutes of the proceedings of the board of directors or the equivalent.”
“327. Minors, persons of full age under tutorship or curatorship, bankrupts and persons prohibited by the court from holding such office are disqualified for office as directors.
However, minors and persons of full age under tutorship may be directors of associations constituted as legal persons that do not aim to make pecuniary profits and whose objects concern them.”
Obviously, the position of director is important, as are his or her obligations.
The law provides a remedy in case of a significant breach:
“329. The court, on the application of an interested person, may prohibit a person from holding office as a director of a legal person if the person has been found guilty of an indictable offence involving fraud or dishonesty in a matter related to legal persons, or who has repeatedly violated the laws relating to legal persons or failed to fulfil his obligations as a director.”
Now, what is the role of the Board of Directors?
In addition to managing the day-to-day affairs of the community, in the absence of a manager, the board of directors is also responsible for the following:
“1072. Each year, the board of directors, after consultation with the general meeting of the co-owners, fixes their contribution for common expenses, after determining the sums required to meet the expenses arising from the co-ownership and the operation of the immovable, and the amounts to be paid into the contingency fund.
The contribution of the co-owners to the contingency fund is at least 5% of their contribution for common expenses. In fixing the contribution, the rights of any co-owner in the common portions for restricted use may be taken into account.
The syndicate, without delay, notifies each co-owner of the amount of his contribution and the date when it is payable.”
However, the board of directors must consult the assembly of co-owners before deciding on any special contribution to common expenses.
Finally, the other obligations of the board of directors are set out in article 1086.1 of the Civil Code, which states that:
“1086.1 The board of directors shall send to the co-owners the minutes of every decision made at a meeting or every resolution in writing passed by the board within 30 days of the meeting or of the passage of the resolution.”
For more information, please do not hesitate to contact us.