Bonus or Gratuity for Council Members?

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There has been a particular case in Singapore where a bonus or gratuity was proposed for outgoing Council Members. It is a very unique situation as the practice in Singapore is Council Members serve in the Council on a pro bono basis, ie, volunteer without compensation.

There is nothing written explicitly in the BMSMA on this matter. So, from the layman’s point of view, it doesn’t seem to be against the law. However, Council Members are required to act in the interests of the estate. Would this be in the interest of the estate? What about the situation where the gratuity for outgoing Council Members is proposed¬† by a Subsidiary Proprietor during an AGM?

Our thoughts are that as long as the AGM approves the bonus or gratuity for the great work done, it is above board and it is the perogrative of the owners to reward the Council Members for the good work done. If the Council’s work was not excellent, this matter wouldn’t even surface and probably be immediately shot down if surfaced.

However, most AGMs are poorly attended. It is possible that a group of owners could collude to pass this gratuity as a resolution and overwhelmingly approve it. Just throwing the spanner into the works. We would welcome comments from readers on this.

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