Understanding Annual General Meetings in Sectional Title Schemes
When you first purchase a property in a sectional title scheme, the idea of attending an Annual General Meeting (AGM) may feel overwhelming or even tedious. However, AGMs are a vital part of ownership and play an essential role in how your property investment is managed.
PPSP Team
Professional Property Solutions Provider
The Sectional Titles Act 95 of 1986, along with the Sectional Titles Schemes Management Act of 2011, provides the framework that governs AGMs and outlines what owners can expect when they attend. In this first article of our six-part series, we give you a comprehensive overview of everything involved in an AGM.
Why Are AGMs Important?
An AGM is not just a formality—it is a legal requirement. The body corporate, as a legal entity, must present its financial statements to owners annually. This meeting creates an opportunity for transparency and accountability.
More importantly, it is the only forum where all owners can collectively:
- Review the financial health of the scheme
- Discuss operational matters
- Consider future projects that may impact finances, such as special levies
Attending the AGM helps you stay informed and ensures you have a voice in decisions that may affect your property and financial obligations.
When Are AGMs Held?
AGMs must take place within four months after the end of the scheme's financial year, and owners must receive at least 14 days' notice prior to the meeting.
What Documents Should You Receive?
Before attending an AGM, you should receive key documents to help you prepare, including:
- Draft annual financial statements
- A proposed budget for income and expenses
- The insurance replacement value schedule
If you are unable to attend, you can appoint someone else to represent you using a proxy form, allowing them to vote on your behalf.
What Is a Quorum?
A quorum refers to the minimum level of participation required for the meeting to proceed legally, whether attendees are present in person or represented by proxy.
Under the current legislation, quorum is calculated based on participation quota (PQ):
4 or fewer sections
66.66%
participation quota required
More than 4 sections
33.33%
participation quota required
Without a quorum, the meeting cannot formally continue.
What Is Discussed at an AGM?
There are three main focus areas at every AGM:
1. Financial Matters
- Approval of the previous year's financial statements
- Review and adoption of the proposed budget
2. Insurance
- Approval of updated replacement values for each section
3. Trustees
- Election of trustees
- Setting out any rules, limitations, or directives for the new trustees
How Does Voting Work?
Decisions at AGMs are made through various voting methods:
- Show of hands
- Secret ballot
- Participation quota (PQ)-based voting
In most cases, voting power is linked to each owner's PQ, and a majority by value determines whether a resolution is passed.
What Happens After the AGM?
Following the AGM, trustees are responsible for implementing key decisions, including:
- Appointing a chairperson
- Finalising levy increases
- Approving interest on overdue levies
- Mandating managing agents to take legal action against non-paying owners
- Notifying owners of any levy increases within 10 days
Owner Preparation Checklist Before an AGM
Walking into an AGM prepared helps you ask better questions and vote with confidence. Use this simple checklist in the week leading up to the meeting.
- Review your levy statement and confirm your account is up to date.
- Read the agenda and annexures so you understand which resolutions will be tabled.
- Note your top 3 questions on budget, maintenance, insurance, and arrears recovery.
- Confirm attendance early or submit your proxy in time if you cannot attend.
- Arrive on time to support quorum and avoid unnecessary adjournments.
Common AGM Misunderstandings to Avoid
"If I skip the AGM, decisions won't affect me"
AGM resolutions still bind all owners, including those absent from the meeting.
"The AGM is only about finances"
Finances are central, but governance, trustee mandates, and compliance decisions are equally important.
"I can challenge every levy after approval"
Once properly approved, budgets and resulting levies are binding unless set aside through the proper legal channels.
Have Questions About Your AGM?
At PPSP, we guide body corporates through every step of the AGM process. Contact us for expert assistance.
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AGM Series Articles
Understanding Annual General Meetings in Sectional Title Schemes
Why is an AGM Necessary and Why Should You Attend?
Understand the role of the body corporate and the real impact of your participation.
Part 3 of 6Frequency and Notice Needed for an AGM
Timing rules, notice periods, and what happens when proper notice isn't given.
Parts 4–6 — Coming SoonMore AGM Topics
Stay tuned for upcoming articles in this series.