# Management Co report to ODCE?



## KlausFlouride (5 May 2016)

Has anyone ever consulted the Office of Corporate Enforcement with regard to a management company? Common areas in apartment block are in need of repairs, Mgt company promise to fix, haven't done so, claim they have no funds and so forth. Issue has dragged on for years now.


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## mathepac (5 May 2016)

Are you an owner-occupier? Do you attend AGMs? Do you get notification of AGMs? Are all management fees paid up to date?


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## KlausFlouride (5 May 2016)

Yes to all


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## Leo (5 May 2016)

I don't think any of the above issues would fall under the remit of the ODCE. What company legislation do you feel they are in breach of?


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## KlausFlouride (5 May 2016)

Possibly not, but they have persistently refused to maintain common areas, which is one of their responsibilities. There seems to be no avenues for redress.


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## mtp (5 May 2016)

I have and agree with moderator.

Have the common area been transferred to the management company ? 

If not then it is whoever owns the common areas who is liable ? Builder/developer? 

What is needed is application under S24 of the MUD Act for an order to compel the owner of the common areas to transfer the common areas to the OMC with the freehold reversion of the leases. S25 of the act list who can make application to the C Court including  any member.

Who are directors of the OMC ?

If Directors of OMC are also directors of OMC then u can establish sinking fund by way of resident association for legal costs .

Also look at your lease and see

* Who s charge are payable to OMC or Builder/ Developer 

AND

* If covenant in lease to u by builder and OMC that OMC not responsible for maintenance cost until common areas transferred to the OMC.

If so u should be getting invoiced for any of these costs by the OMC as they are/would be  builder /developer responsibility under lease until completion of transfer of common areas to the OMC. .


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## Joe_90 (5 May 2016)

> Possibly not, but they have persistently refused to maintain common areas, which is one of their responsibilities. There seems to be no avenues for redress.



You own the management company.  Get some of the other members together and vote out the board at the next AGM and appoint yourselves and get it done.


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## KlausFlouride (6 May 2016)

Joe_90 said:


> You own the management company.  Get some of the other members together and vote out the board at the next AGM and appoint yourselves and get it done.



That seems to be the only means of redress, but it's useless in practice. In my scenario, the MC covers c. three hundred units, a mix of houses and apartments. The house owners (who outnumber the apartment owners 2:1) are not going to chip in extra to sort out issues in the common areas in the apartments. It would need a third party to get the work done, not a negligent & disinterested MC.


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## Andy836 (6 May 2016)

KlausFlouride said:


> That seems to be the only means of redress, but it's useless in practice. In my scenario, the MC covers c. three hundred units, a mix of houses and apartments. The house owners (who outnumber the apartment owners 2:1) are not going to chip in extra to sort out issues in the common areas in the apartments. It would need a third party to get the work done, not a negligent & disinterested MC.



You need to dig out your management agreement and get a copy of board minutes and report from the last AGM. 
Make sure it's not just the same MC covering multiple management contracts in the same development. 
You might not need the support of the houses. However, if the houses are part of the same management contract they're obliged to contribute whether they like it or not.

You literally have to take ownership of the problem. If you don't and the problem has been festering for a long time, it's likely no one will. 

We had a similar issue in our building. Our previous management company didn't maintain cooling tanks which now have to be replaced at a cost of $400k to $600k!! It wasn't until a new tenant came in with a background of sitting on a board that the issue was addressed and a new management company introduced.


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## jdwex (6 May 2016)

Can we use the terms Managing Agents and Management Company correctly to avoid confusion!?


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## lantus (7 May 2016)

The odce produce a very good guide to omc issues from the point of company law. Its free so get a copy. 

In relation to their role as enforcers it covers things like failing to hold an agm and fraud (which requires significant proof.)

Being rubbish at running an omc and failing to maintain a development isn't a company law matter.

In a mixed development it would be normal for houses and apartments to have different service fee structures. So houses wouldn't normally contribute to common building costs.

This sounds like a combination of reduced fee income, service fees set too low and possibly an agent or board that is not planning predicted and unpredicted maintenance correctly.

Subject to your development it may be possible to limit services for non payers for apartments. Access, services, parking. 

Its unpleasant work but being a director of an omc is a position of responsibility.


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## Joe_90 (7 May 2016)

KlausFlouride said:


> That seems to be the only means of redress, but it's useless in practice.



The members own the management company, the members appoint the directors of the management company to do the job on their behalf.

The directors set the budget for the year and therefore the management charges for the estate.

As Lantus has said the management charge for the houses is probably relatively small in comparison to the apartments.

The biggest issue that management companies have and we as accountants to a number is collecting management charges.

Some members simply don't pay and there is little (Lantus has advised of some options) that the Management company can do other that expensive legal action to get paid.

Get yourself into the board of the management company and resolve the problems yourself.

Personally I think the MUD Act should have a remedy for the non payment of management charges.

So initially parking rights, then restriction on using communal services waste collection/ Tv etc then right of access to common areas.

It's not fair that the people who pay their charges are having services curtained because some members won't pay.


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## mtp (18 May 2016)

Klaus Floride  has the common areas in the apartment block been transferred to the management company and and if not then it is lessor responsibility , I understand the problem u are having with house owner.


an application under S24 for a separate OMC to be set up for that portion of the development comprising the apartment block the member of which are the apartment owner will allow u  deal with the issue affecting your common areas thru your own OMC may be best option? . Hope that helps ?  Home owner may HAVE THERE own problems if OMC struck off for no interest.


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## mtp (18 May 2016)

no omc can invoice member for service charge to perform work or service that are the responsibility of the lessor until the common areas are transferred to the OMC . it is a breach of covenant of OMC to lessees and S18 MUD Act.

but in most case member /homeowner are just ignoring - rather than setting s charge for legal cost to compel developer transfer the areas to the OMC with the lease and then we can take on the work and control the lease . But aint happening at moment.

I suspect may be part of problem with common areas of the apartment building and if so and if u do oust directors and get on board - set s charge for insurance and legal cost to get the land and lease transferred to the OMC. MUD Act S17 18 and 19 is guideline on setting s charges and meeting required to do so .


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## mtp (18 May 2016)

I'm coming back on matter of costs cost legal cost for any member of an OMC - those who can apply to the circuit court is set out in section 25 of the MUD Act and the order that can be applied for is set out in S24. But costs are expensiveI have written to the TD in my constituency about extending civil legal aid scheme to application to he circuit court under S24 and application to the high court on the validity of the appointment of receiver . u might want to make representation to your own TD of similar nature.


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## lantus (6 Jun 2016)

mtp said:


> no omc can invoice member for service charge to perform work or service that are the responsibility of the lessor until the common areas are transferred to the OMC . it is a breach of covenant of OMC to lessees and S18 MUD Act.
> 
> but in most case member /homeowner are just ignoring - rather than setting s charge for legal cost to compel developer transfer the areas to the OMC with the lease and then we can take on the work and control the lease . But aint happening at moment.
> 
> I suspect may be part of problem with common areas of the apartment building and if so and if u do oust directors and get on board - set s charge for insurance and legal cost to get the land and lease transferred to the OMC. MUD Act S17 18 and 19 is guideline on setting s charges and meeting required to do so .



untrue. An omc has a beneficial right of ownership on any common areas and can quite happily levy money from its members before common area transfer. 

In many cases the developer is gone so no section in the MUD act will be any help at all. I'd say your clutching at straws unless its a very unique contract lease document.

In any case you should seek out proper legal advice as I have done on the matter with specialists in this area of law. They have confirmed the above to be true.


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## mtp (10 Jun 2016)

Dear Landus 

I am a solicitor.


See  ODCE Company Law Handbook on residential property owners Management Companies Chapter 6 .13 ' If during this period (prior to the transfer of common areas to the OMC) property owners have concerns about the services ...........their remedy should be to examine what property law rights or entitlement are open to them as against the developer rather than as against the management company. Likewise any attempt by the management company to sue in its own corporate name for the non payment of service charges may be ineffective. 

Decision of C Court in Tyrellstown No 4 Management Company Ltd -v- Okonkwo.    

This does depend on the underlying conveyancing document - the contract in lease. IF  OMC is entitled to collect the s charge then that that but if it is lessor until common areas transferred to the OMC then OMC has no right at all to sue for service charge to perform any of the obligation that are developer under it until the lands are transferred to the OMC save as set out in S18 of MUD Act. 


OMC are not, but can  collect for sinking fund for legal cost to compel the developer and receiver to complete the contract for sale and transfer common areas with lease to the OMC
.


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## mtp (10 Jun 2016)

We in this estate had same experience as tyrellstown residents when the developer /lessor, entitled to collect the s charge, used the management company with shadow directors, to sue for arrears in service charge prior to transfer of land to the management company. 

The actions  by the management company were struck out - the wrong plaintiff. 

The lessor still own lands and will continue to own them until they are disposed of with leases to third party purchaser or OMC
.


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## Leo (10 Jun 2016)

mtp said:


> PS We in this estate has all that the right of any OMC to sue for S Charge when the developer /lessor under lease entitle to cllect and chare the s charge - we had it all and used the OMC to sue for s charge prior to transfer - all struck out



You might consider editing that for clarity...


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## lantus (10 Jun 2016)

The typical contract lease and common ground transfer lease generally doesn't specify this kind of rigid arrangement where the developer is essentially legally bound to provide services prior to transfer although some do exist along with several other specific lease arrangements. Albeit rare. 

In most cases the developer uses the omc early on to avoid any financial entanglement and in so many cases the developer is gone so any contract involving them is fairly weak. 

Of course in your case mtp it seems like you have a case but I'd say its a rarity rather than a common occurrence.


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## mtp (30 Jun 2016)

Attached report of the decision of the c court in the action taken by tyrellstown no 4 management company for arrears which was struck out as management company was not the correct plaintiff and common areas had not been transferred to the OMC.

OMC cannot levy service charges for costs work the responsibility of the lessor /builder until completion of the contract for sale and transfer of common areas to the OMC with the leases without written consent of 75 per cent  of ALL member under S18.6 MUD Act.

That order may be available form C Court Office in Dublin. Applies only to estate when under leases it is LESSOR who is entitled to receipt of s charge - he fact that lessor direct payment be made into bank account in name of man co is not man co business the main thing is that it is still lessor entitled to receipt until common areas transferred . . 
C:\Users\Toshiba\Desktop\higgins-backs-service-charge-ruling tyrellstown.pdfC:\Users\Toshiba\Desktop\higgins-backs-service-charge-ruling tyrellstown.pdf

.


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## fairgr (12 Jul 2016)

I have an Appartment in a complex where the common area has not been transferred to the OMC. The developer still owns a number of appartments together with a number of commercial units which are all under one common roof. A receiver has now been appointed over developer and they are planning to sell the appartments and commercial units. The OMC are very active and well supported by the Appartment owners. Can the receiver sell individual properties and if so what happens to common areas as I presume that the receiver has no rights to transfer or lease the common areas potential buyers


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