By-law Changes Redlined Against Current Version of the By-law (Word Doc w/comments)
By-law Changes Redlined Against Current Version of the By-law (PDF)
Clean Copy of Proposed By-law
Note of Explanation to Accompany By-law Changes
Q&A’s re Proposed Revisions to HPI By-Laws
Why does HPI Want to Revise its By-laws?
HPI’s by-laws need to be changed to more accurately reflect how the organization has evolved since its founding, to be consistent with the Corporations Act which currently governs HPI and to reflect the proposed legislation, the Not-for-profit Corporations Act, which will likely come into effect at some point during 2013.
Who is the “City of Toronto” in the context of choosing the ex-officio Board member? Should the reference be more specific such as to the General Manager or the Director of Parks, Forestry and Recreation? Do we need to indicate that the ex-officio board Member is there to represent the City?
The lease agreement between HPI and the City of Toronto provides that the “City of Toronto” shall have the right to nominate one Board member as observer who shall not any voting rights. The language in the revised by-law mirrors such language. In addition, such a broad description is preferable to the use of a department name as department names and responsibilities likely shift more often that the broader description of the “City of Toronto” which then obviates the need for a bylaw change each time a city department changes its name or responsibilities. As far as HPI is aware, this is the City of Toronto’s preference. It is not necessary to indicate that the Board member nominated by the City of Toronto is there to represent the City of Toronto. Were the City to conclude that its interests were not being represented it could remove and replace the board member it appointed.
In order to keep the by-laws as simple as possible, should parts of it be moved to separate documents such as a set of governance policies and a board of conduct code of conduct.
The by-laws sets out how the corporation shall be governed. Its provisions are mandatory. There is no advantage in moving any part of these rules to a separate document such as a governance policy or code of conduct that would have dubious legal status and would not be enforceable by the members of HPI.
With regard to compliance rules, should we not indicate the “norm” in addition to the outside limits. For example, an AGM must be called no later than 15 months after the previous one. Should we not also set out when an AGM is to normally be called, such as within 6 months but in any case not later than …?
The by-law sets out the rules. The norms are not enforceable. If the proposed language is in the by-law, the members have no right to enforce an AGM before the 15 month period has ended. The norm is not enforceable and should therefore not be part of the by-law.
Similarly, should we not state that “Directors should be members in good standing” as the norm, and then add a provision to cover the possibility of Directors becoming Members after they are elected as Directors, in case they are not already members?
Please see paragraph 6.1 of the revised by-law which sets out language to that effect.
For the AGM, if only the 15 month limit wording is to be used, should there be a firm date to start counting from such as the date of the last AGM?
Please see paragraph 12.1 of the revised by-law which sets out language to that effect.
There is a three year term for Directors. Why is there not set a term for Officers?
As set out in paragraph 9.4, the Officers are chosen by the Directors. After each AGM, the Board members then in office decide who on the team will perform which function. As a result, the maximum term that each officer holds is the time between AGMs or 15 months. The Officer position is not entrenched like the Board positions, the Officers serve at the pleasure of the Board. The Board members can vote to remove an Officer and to replace him or her with another Board member at any time. This more flexible arrangement is vastly preferable on a small not for profit Board like HPI as, given the time commitment inherent in the role of the officers, it is often difficult to lock a board member into a particular Officer role for much more than a year.
Paragraph 6.3 which sets out the 3 year term for Directors does not use the word “term” which is used several times elsewhere in the document. It would help the reader to tie these together more clearly by using “term” the first time.
The language in paragraph 6.3 as currently drafted in the revised by-law is clear. The reader understands that the Directors are elected for (a term of) three years. No change is necessary to help the reader’s understanding.
Where does paragraph 11.9 come from? It seems very unusual to “not allow a director to abstain”.
The role of a director is to make decisions and to vote on resolutions. If a director is allowed not to vote, he or she is being permitted to not perform the role a director is meant to perform. If a director cannot vote on an issue, he or she should resign and let another person perform the role of director, which includes voting on resolutions. The provision is not unusual. It is also desirable to ensure the proper and intended functioning of a board.
Paragraph 6.5 dealing with quorum would be clearer if “holding office” were added before “at that time” so it is not confused with directors “present at the meeting”.
It is not necessary to add the words “holding office” as proposed. It is evident that the quorum is not a majority of the voting directors “present at the meeting”. If the quorum were a majority of the voting directors present at the meeting, there would always be a quorum for the meeting and, therefore, the provision would be meaningless.
A provision should be added to paragraph 6.5 to clarify that the directors can continue with business if the quorum is lost “but cannot pass any motions or resolutions”.
The last part of paragraph 6.5 provides that, if there is quorum at the beginning of a meeting, quorum is deemed satisfied throughout the meeting even if it lost during the meeting. Adding the proposed language would render that provision meaningless. The purpose of this provision is to prevent a director from walking out of a meeting to prevent a vote. For example, assume a situation where quorum is 5 and there are 5 directors at a meeting. A resolution is deliberated and the “Highjack Director” is against it but learns that the 4 other directors would vote in favour of the resolution and that the resolution would be passed if a vote is taken. If the language of paragraph 6.5 is changed as proposed, the Highjack Director walks out of the meeting so that quorum will no longer be satisfied . The Boards’ ability to pass resolutions, which is how the board legally governs, should not be highjacked by Board members walking out of a meeting to prevent a vote.
The wording of paragraph 11.3(b) is very confusing. Is there a clearer way to express it?
The language is consistent with 60(1) of the Not-for-profit Corporations Act which is the revised legislation to take effect in 2013.
Robert’s Rules specifies a 2/3 majority as in the current by-laws. What is the authority or rational for moving to a simple majority?
Section 129 of the Corporations Act provides for simple majority voting. Where super majority is required, the legislation makes it explicit, such as in section 130 and section 132. 17(2) of the Not-for-profit Corporations Act, which requires an “ordinary resolution” confirms that only a majority is required.