Trustee voting rights

27 June 2014
Comments Comments Off on Trustee voting rights
27 June 2014, Comments Comments Off on Trustee voting rights

Voting Power under the Deed

Question

It is my understanding that the Now Infinity SMSF Deed stipulates voting power is weighted on member balances.

Can this be easily amended should the members want non-weighted voting power?

Do you have two different versions of the deed available for either option?

Response

The Trustee is required to hold a Trustee Meeting in order to make decisions about significant events that transpire in relation to the Fund. Significant events are those events that impact upon the status of the Fund and its Members which may include the payment of a lump sum, the setting of an investment strategy or the appointment of a new Trustee.

The Superannuation Laws provide that matters determined at every valid Trustee meeting must be recorded in the minutes of the Trustee. These minutes and all records of the Fund must be held for a period of no less than 10 years.

Under the NowInfinity SMSF trust deed, at a Trustee meeting, each Trustee is given one vote per dollar balance in the Superannuation Interests of the voting Members that the Trustee represents.

However, the Trustees may determine at a valid Trustee Meeting an alternative voting method of the Trustee for the purpose of that specific Trustee Meeting, a matter to be decided at that Meeting or for future Meetings. A specific resolution is necessary for alternative voting for Trustee Meetings at any one given time.

Where there is a corporate trustee likewise the NowInfinity special purpose corporate trustee mirrors the provisions of the deed as the trust deed cannot override the terms of the company constitution which is why a normal company may not suffice as a SMSF trustee company.

Any decision is to be passed at a Trustee Meeting by a simple majority of votes. It must be evidenced by dated minutes and signed by the chairperson of the specific meeting.

Any decisions made at a valid Trustee meeting that may impact upon Member benefits, either directly or indirectly, must be notified to the Members within a reasonable period of time if they did not attend the meeting as Trustee or director of a Corporate Trustee.

Where the Trustee is a Corporation, the constitution will qualify the voting and decision-making process for the Trustee.

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