How to HOA Part 5 | Different types of meetings

14 February 2025 | Nicole Nel

Previously, we spoke about the management committee of the Homeowners Association (“HOA”): who they are, how they are elected and removed, what their duties/obligations are, and how they differ between common law and Non-Profit Company HOAs.

For this article, we will be focusing on the different types of meetings, and the general meeting processes to be followed, within an HOA. 

Non-Profit Company HOA

In a Non-Profit Company HOA, meetings and their processes are not only governed by the Memorandum of Incorporation (“MOI”) of the HOA, but also the clauses in the Companies Act 71 of 2008 (“the Companies Act”) relating to meetings. However, as per usual, the Companies Act does not provide much guidance to Non-Profit Company HOAs specifically, and therefore it is essential for an up-to-date MOI to be kept by the HOA. 

Interestingly, the Companies Act does provide the clause that if a minimum of 10% (ten percent) of shareholders (members) request for a general meeting to be held, same must be called by the Directors. Furthermore, the MOI may have a lower minimum requirement from 10% (ten percent). 

The Companies Act was ahead of its time in the sense that it had already made for provision for electronic meetings and participation in meetings electronically back in 2008. Furthermore, the Directors have the power to determine the location of the meeting, including electronic attendance, in terms of the Companies Act. 

Furthermore, at minimum, the following business must be transacted at an annual general meeting of a Non-Profit Company HOA:

1. Presentation of—

1. The directors’ report;

2. The audited financial statements for the immediately preceding financial year; and

3. An audit committee report, if applicable;

2. Election of directors, to the extent required by this Act or the company’s MOI;

3. The appointment of—

1. An auditor for the ensuing financial year; and

2. An audit committee; and

4. Any matters raised by shareholders, with or without advance notice to the company. 

Notice for general meetings within a Non-Profit Company HOA is also regulated in terms of the Companies Act, with a minimum of 15 (fifteen) business days’ notice required for Non-Profit Company HOA meetings, noting that an MOI may allow for a shorter or longer notice period. 

Although the Companies Act does not impose a longer notice period for general meetings where a special resolution is to be considered, it is the norm, in my experience, for the notice period for a general meeting where a special resolution is being considered to be elevated to 21 (twenty-one) business days. 

The notice for a general meeting must also be in writing, and include:

• the date, place and time of the meeting,

• the purpose of the meeting,

• a copy of any proposed resolution which is to be considered, and

• a statement including that a shareholder (member) may attend the meeting via proxy. 

Now is also a good time to note that within a Non-Profit Company HOA, no limitation may be placed on the number of proxies an individual may hold, and this is considered to be an unalterable, i.e. cannot be changed, clause within the Companies Act. 

The Companies Act also introduces a recommended quorum of 25% (twenty-five percent), however, this can be increased or lowered in terms of the HOA’s MOI. 

In addition to the above, the Companies Act does not distinguish between annual general meetings (“AGMs”) and special general meetings (“SGMs”). In this regard, it is important that the MOI highlights the different requirements for same. 

Common Law HOAs

For common law HOAs, meetings and their processes are only governed by the HOA’s Constitution, and do not differ greatly from its Non-Profit Company HOA counterparts. 

In fact, because common law HOAs do not have a baseline piece of legislation, they take a lot of guidance and inspiration from the Companies Act, as well as the Sectional Titles Schemes Management Act 8 of 2011 (“the STSMA”), with regard to administration and management of the HOA, and how to draft its Constitution, i.e. the governing law of their HOA. 

One of the only notable differences between a Non-Profit Company HOA and a common law HOA general meeting is that proxies can be limited, in terms of the HOA’s Constitution, at a common law HOA general meeting. 

Conclusion: HOA’s must have up-to-date governance documentation

In conclusion, as there is not much formal legal guidance with regard to the types of meetings and how they should be run within HOAs, it is, again, so imperative for HOA’s to have up-to-date governance documentation that accurately reflects the current meeting processes and requirements being adopted within the HOA.

Should you require any more information regarding this topic, don’t hesitate to contact us today on 061 536 3138 or at info@tvdmconsultants.com

If you haven’t read the fourth article in this series, where Nicole focuses on the management committee of the HOA, then click here to do so.

About the Author:

Nicole Nel is a Community Schemes Consultant at TVDM Consultants, Click here to learn more about her.