# Management company  fees in PIA



## Fastmover (30 Nov 2022)

Hello can somebody help me please?

I completed a lump sum  PIA with Grant Thornton in January 2020. Throughout the whole duration of the process from our initial meeting it was always understood that the management fees on my apartment will be included in my PIA. However a year later the management fees are still outstanding and they’re compounding interest every year.

I have contacted the management company and they say the PIA has nothing to do with them even though they are an included creditor in my final settlement. I have raised this with Grant Thornton and they have said they were notified of the creditors meeting but got no response. I have asked for proof of this for the last four months but have not received any support. 

Can anyone advise me how best to resolve the situation. Many thanks for your help


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## TLO (30 Nov 2022)

This is an interesting one.  Let's see what the Insolvency Service of Ireland says in their PDF:



			https://www.isi.gov.ie/en/ISI/PIA_July_2016.pdf/Files/PIA_July_2016.pdf
		


On Page 10 they say that "Annual service charges to owner’s management companies" are an "Excludable Debt".  And there is an asterisk to the bottom of the page where it says:

" *Creditor consent to include debt may be requested in which case it becomes a permitted debt. If no response is received the creditor will be deemed to have consented."

So Grant Thornton appear to be saying that the Management Company was written to, failed to respond, and by not doing so are deemed to have consented to the management fees being included in the PIA.

So far so good.  But how do you get the Management Company to update it's records?  Under GDPR, information must be kept accurate, and at the moment, it's not.  So it might be possible to use GDPR protections in an effort to get the Management Company to write off the outstanding fees.


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## Fastmover (30 Nov 2022)

TLO said:


> This is an interesting one.  Let's see what the Insolvency Service of Ireland says in their PDF:
> 
> 
> 
> ...







Thank you for your reply. I never thought of a GDPR request to the management company.

 This is where things get complicated. I can categorically state that at no time in my dealings with Grant Thornton they outlined that management fees were an excludable debt or I would’ve been all over this. I only found out when I read all the legislation because the management company were being a bit too cocky. Now before anyone says forewarned is forearmed I paid €5000 in fees for a PIA you expect professionals to do their job. 
On the financial statement the debt is listed as an excludable debt. There is a box that says has the creditor consented to this being included and they’ve ticked no. Also says has the creditor been notified and they have ticked no

When I finally got through to someone in Grant Thornton they said they were notified but I’ve been waiting over 3 months to get them to send proof... I’ve even asked for a GDPR request that will take three months

I can tell anyone who is contemplating using Grant Thornton that the after-care sucks


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## TLO (1 Dec 2022)

So it's not clear if the fees were included or excluded from the PIA.  You said, _"Also says has the creditor been notified and they have ticked no". _ This suggests that the fees were excluded from the PIA unless Grant Thornton can prove that the management company was written to, which they haven't done so far.   It might well be that, in the absence of proof otherwise, you still owe the fees.


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## Raging Bull (5 Dec 2022)

Property mgmt Co have the option of staying outside a PIA. But they must elect to do so and confirm in writing to your PIP

Otherwise they are included and the debt is written off for a dividend under the arrangement.

Your PiP should be able to tell us this


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## Fastmover (12 Dec 2022)

I’ve just had a phone call from Grant Thornton staying that the management company opted out of the PIA. No one ever told me this and I’ve spent the last 4 months chasing this information. 

I’m livid as now the management fees are €40k with compounding interest. Grant Thornton are a disgrace 

If anyone can recommend where to go from here


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## Raging Bull (12 Dec 2022)

You can only do one PIA in your lifetime. It should have been made clear to you, in fact you need to approve the proposal before it's sent.

Make a complaint under their procedure or to regulator.

Without knowing your circumstances it would be hard to give much insight.


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## ClubMan (12 Dec 2022)

For what it's worth, Google "How to make a complaint against a PIP" to find the ISI's guide. Unfortunately, I can't find the page with the link to this document.


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## Fastmover (12 Dec 2022)

ClubMan said:


> For what it's worth, Google "How to make a complaint against a PIP" to find the ISI's guide. Unfortunately, I can't find the page with the link to this document.


Thanks for this advice. 


Raging Bull said:


> You can only do one PIA in your lifetime. It should have been made clear to you, in fact you need to approve the proposal before it's sent.
> 
> Make a complaint under their procedure or to regulator.
> 
> Without knowing your circumstances it would be hard to give much insight.


The draft PIA had the management company as a creditor that was to be included in the PIA. They were issued a dividend. I’m livid at this now 2 years later I’m only finding it out


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## Raging Bull (12 Dec 2022)

If they opted out they wouldn't be even in a draft or shouldn't be more correctly


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## Fastmover (12 Dec 2022)

Raging Bull said:


> If they opted out they wouldn't be even in a draft or shouldn't be more correctly


I can tell you verbatim they are issued a dividend in the PIA.


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## Raging Bull (12 Dec 2022)

Fastmover said:


> I can tell you verbatim they are issued a dividend in the PIA.


Well then it's a significant issue as you thought you were signing up to something that it wasn't


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## ClubMan (12 Dec 2022)

If I was in your shoes I would make a formal complaint in writing to the PIP setting out my argument and asking them to negotiate some sort of settlement - e.g. they cover some or all of the outstanding management fees due. I would try to set out my issue/argument/complaint/expectations as simply and concisely as possible.

If that goes nowhere then I would read up and follow the ISI PIP complaints process that I mentioned earlier.


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## Fastmover (12 Dec 2022)

Raging Bull said:


> Well then it's a significant issue as you thought you were signing up to something that it wasn't


100% all along they said the management company made no contact. I can tell you if somebody has said to me that the management fees were not going to be in my PIA I wouldn’t have gone through with it because that time it was €20,000...


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## Raging Bull (13 Dec 2022)

Unfortunately we can't help you as you don't have full picture. They either opted out or they didn't. 

If Mgmt co did nothing they are in after 21 days of receipt of the PIPs section 98 letter.

You are going to need to raise complaint with the PIP and/or regulator and send your own GDPR request to Mgmt co looking for your data and communications with your PIP over this issue


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## Fastmover (13 Dec 2022)

ClubMan said:


> If I was in your shoes I would make a formal complaint in writing to the PIP setting out my argument and asking them to negotiate some sort of settlement - e.g. they cover some or all of the outstanding management fees due. I would try to set out my issue/argument/complaint/expectations as simply and concisely as possible.
> 
> If that goes nowhere then I would read up and follow the ISI PIP complaints process that I mentioned earlier.


I am waiting for my file from Grant Thornton under a GDPR request. I will have to pursue this further because I was sold a pup. Thanks for your advice


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## Fastmover (13 Dec 2022)

Raging Bull said:


> Unfortunately we can't help you as you don't have full picture. They either opted out or they didn't.
> 
> If Mgmt co did nothing they are in after 21 days of receipt of the PIPs section 98 letter.
> 
> You are going to need to raise complaint with the PIP and/or regulator and send your own GDPR request to Mgmt co looking for your data and communications with your PIP over this issue


Yesterday evening  a member of Grant Thornton called me to say that the management company had opted out of the PIA. This is the first time I have got that information. My creditors meeting was in July 2019.  Grant Thornton had always told me that there was no communication from the management company. The management company debt was included in my PIA. I will have a better picture when I receive my file under a GDPR request. This is absolutely shambolic


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## TLO (13 Dec 2022)

So, to summarise:

July 2019.  Your PIP tells you that the management company debt is included in the PIA.  You let the creditors meeting go ahead.
August 2022.  (4 months ago) You start querying your PIP.
December 2022 (Yesterday) Your PIP, or somebody on their behalf, tells you that the management company, as is their right, had opted out of the PIA.

In other words, you were told one thing in 2019, and something different in 2022.  And had you been fully informed in 2019 you may have chosen a different course of action.


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## ClubMan (13 Dec 2022)

Deleted - ignore


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## Fastmover (13 Dec 2022)

TLO said:


> So, to summarise:
> 
> July 2019.  Your PIP tells you that the management company debt is included in the PIA.  You let the creditors meeting go ahead.
> August 2022.  (4 months ago) You start querying your PIP.
> ...


Yes that basically sums it up. Except I’ve tried for a year on and off to get clarification  from Grant Thornton as the management company kept sending me statements with the balance increasing...then four months ago when I read all the legislation about management fees I’ve been pursing clarification relentlessly from Grant Thornton on the status of the management company fees and finally now last night I was told they opted out of the PIA 

I chose a PIA because I was led to believe that all my debts would’ve been taken care of and I could keep my apartment. Also the management fees owed have escalated from 23,000 to now 44,000 in the space of three years when I assumed the management company was dragging its heels implementing the PIA . They are compounding the interest like the mafia.


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## ClubMan (13 Dec 2022)

Fastmover said:


> Also the management fees owed have escalated from 23,000 to now 44,000 in the space of three years when I assumed the management company was dragging its heels implementing the PIA . They are compounding the interest like the mafia.


Just curious, what is the annual management fee and the rate (and fees?) that they charge on arrears?


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## Fastmover (13 Dec 2022)

ClubMan said:


> Just curious, what is the annual management fee and the rate (and fees?) that they charge on arrears?


Yearly fee is around €550 and interest appears to be around 20%...I will get exact figure then I get my GDPR Information from the management company. I’ve had mental issues for a period of time and I let it slide and now the interest is nearly 5000 a year


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## ClubMan (13 Dec 2022)

Does that mean that no management fee was paid for c. 15 years or so and the arrears and interest have been accumulating all that time?

Whatever about that I guess that you still need to get further clarification from the PIP, make a formal complaint if necessary, try to get it resolved with them, and if that doesn't work, pursue the ISI PIP complaints process?


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## Raging Bull (13 Dec 2022)

Froma PIP perspective these fees are hard to get rid of. Most opt out unless they forget. Should a deal be reached they are bound by the result.

There's ways to get rid of them like Mortgage to Rent in a property sale but also in Bankruptcy where they are unsecured debt.

Surcharge interest of 20% is often and possibly illegal on numerous grounds such as unfair terms.

I've seen 44k bills on these and it's basically a form of blackmail. They need greater regulation.


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## Fastmover (13 Dec 2022)

ClubMan said:


> Does that mean that no management fee was paid for c. 15 years or so and the arrears and interest have been accumulating all that time?
> 
> Whatever about that I guess that you still need to get further clarification from the PIP, make a formal complaint if necessary, try to get it resolved with them, and if that doesn't work, pursue the ISI PIP complaints process?


Like I said there’s a long history with mental illness and I was always playing catch up. That is why my finances got so bad I needed  a personal Insolvency resolution. When I have all the GDPR from every area I’ll decide my next course of action. Thanks for your advice


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## TLO (14 Dec 2022)

@ClubMan , I'm glad you dug deeper into how the management fees built up.  I was also intrigued. And as @Raging Bull says, "surcharge interest of 20% is often and possibly illegal".

One of the aims of the insolvency process is to return the debtor to solvency at the end of it.  Upon completion of the PIA, the OP still owed €23k to the management company.  It's possible that the OP was insolvent exiting the PIA process.  If this was the case, then the PIA has been futile exercise, and an utter failure.

If the OP is insolvent, then the more important goal should be a return to solvency.  Holding the PIP accountable for the management of the PIA is merely one part of the overall situation.


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## Raging Bull (14 Dec 2022)

We don't know the individuals circumstances but given they opted out it's certainly a question whether the PIA would be suitable thereafter


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## jdwex (14 Dec 2022)

Fastmover said:


> Yearly fee is around €550 and interest appears to be around 20%...I will get exact figure then I get my GDPR Information from the management company. I’ve had mental issues for a period of time and I let it slide and now the interest is nearly 5000 a year


Re interest rate, take a look at the lease, here is an example





Current interest rate for a personal overdraft in AIB is 11.85%


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## Fastmover (1 Jan 2023)

Raging Bull said:


> Froma PIP perspective these fees are hard to get rid of. Most opt out unless they forget. Should a deal be reached they are bound by the result.
> 
> There's ways to get rid of them like Mortgage to Rent in a property sale but also in Bankruptcy where they are unsecured debt.
> 
> ...


Happy New Year to everybody

I was hoping maybe you could give me some advice and help how these management fees are illegal and what areas should I look at

Many thanks for your help


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## ClubMan (1 Jan 2023)

Whatever about the issue of whether or not the management fees should've been dealt with by the PIA/PIP, why do you think that they might be classified as "illegal"? Surely the fees and any possible penalties/interest for non payment are set out in the management company lease and/or other official documents (e.g. AGM minutes, annual reports etc.)?


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## Fastmover (2 Jan 2023)

ClubMan said:


> Whatever about the issue of whether or not the management fees should've been dealt with by the PIA/PIP, why do you think that they might be classified as "illegal"? Surely the fees and any possible penalties/interest for non payment are set out in the management company lease and/or other official documents (e.g. AGM minutes, annual reports etc.)?


Hello I don’t know how they could be illegal I’m just referring to what raging Bull said. That’s why I asked a question of him for some pointers


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## Raging Bull (4 Jan 2023)

There are two ways you can tackle these firstly the rate itself being extortionate under unfair terms regulations...but the compounding of interest being Interest on Interest is Surcharge interest and not permitted


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## mtp (6 Jan 2023)

Have u checked arts of association of the management companies on voting rights of members cos under ours the voting rights vest in the subscribers to the arts of association developer solicitors until 60 days after the developer has no interest in the estate and the common areas transferred to the management company? Under S188 of the Companies Act as applied by S1206 member voting right are set out by in S1206 but in the event of conflict between S1206 and Arts of Assoc the arts of assoc prevails. In a nutshell if the voting rights of omc vest in subscribers till developer gone form estate not on title then MEMBERS OWNER MEMBER simply do not have the power


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## ClubMan (6 Jan 2023)

mtp said:


> In a nutshell if the voting rights of omc vest in subscribers till developer gone form estate not on title then MEMBERS OWNER MEMBER simply do not have the power


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## Fastmover (6 Jan 2023)

mtp said:


> Have u checked arts of association of the management companies on voting rights of members cos under ours the voting rights vest in the subscribers to the arts of association developer solicitors until 60 days after the developer has no interest in the estate and the common areas transferred to the management company? Under S188 of the Companies Act as applied by S1206 member voting right are set out by in S1206 but in the event of conflict between S1206 and Arts of Assoc the arts of assoc prevails. In a nutshell if the voting rights of omc vest in subscribers till developer gone form estate not on title then MEMBERS OWNER MEMBER simply do not have the power


Thanks for this information I am awaiting a GDPR request from the management company so I’ll look into all the meetings and minutes and voting over the years. I’ll look into this also


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## jdwex (6 Jan 2023)

Raging Bull said:


> There are two ways you can tackle these firstly the rate itself being extortionate under unfair terms regulations...but the compounding of interest being Interest on Interest is Surcharge interest and not permitted


In what circumstances is compound interest illegal?


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## Fastmover (Saturday at 2:19 PM)

I have received an email from Grant Thornton that stated they miscommunicated the inclusion of the management fees in my PIA. They have offered to liaise with the management company. Not sure what that will achieve but it’s good they have admitted the error


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## mtp (Tuesday at 9:33 AM)

Fastmover said:


> Thanks for this information I am awaiting a GDPR request from the management company so I’ll look into all the meetings and minutes and voting over the years. I’ll look into this also


I have dealt with Grant Thornton in proceedings against MPH Ltd and Tom Kavanagh in respect of the MUD Estate at Chapel Farm. Assuming the member who set the service charge had the power to do so under the art and companies act they also have to be set by MEMBERS in accord with S18 of the MUD Act and sinking fund in accord with S19 of the MUD Act. .  Under S18 of the MUD Act service charge require agreement of 75 per cent of the members and even this will have no effect for service charge for expenditure that is or WAS the responsibility of the developer  (captures a developer not trading) and until three years after the common areas transferred to the omc. So question were service charge u are being charged for plus interest set in accord with S18 of the MUD Act and C Act that give precedence to arts on voting rights .. both in our case C Farm agree .. if common areas not transferred and developer still on title in estate then member of omc just do not have


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## mtp (Tuesday at 10:07 AM)

S18.6 Mud act.


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## mtp (Tuesday at 10:10 AM)

MPH is now dissolved and that move thing a great deal forward for me as a home owner but i hope u dont mind me saying this but it seem to me that home owner entering these pia agreement ..  shld be taking LEGAL ADVISE.  If owner member of an omc invested in common fund may be nest one u ever made. .. besst investment.


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## mtp (Tuesday at 10:11 AM)

jdwex said:


> Re interest rate, take a look at the lease, here is an example
> View attachment 6936
> 
> Current interest rate for a personal overdraft in AIB is 11.85%


even under this NO LIABILITY till common areas transferred .. are they ?


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## Fastmover (Tuesday at 11:01 AM)

mtp said:


> MPH is now dissolved and that move thing a great deal forward for me as a home owner but i hope u dont mind me saying this but it seem to me that home owner entering these pia agreement ..  shld be taking LEGAL ADVISE.  If owner member of an omc invested in common fund may be nest one u ever made. .. besst investment.


Thanks for all your input. I would fully agree with you now in hindsight. I’d go so far as to say that it should be mandatory for a PIA because there is so much at stake


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## mtp (Tuesday at 12:22 PM)

If u keep getting billed U may have to consider going to court .. application under S24 MUD Act to C Court to determine if the service charge u are being billed with was set in accord with MUD Act and C Act.  The liquidator / accountants dont interpert law. They assume OMC well within it power to set s charge and accept or decline participating in a pia scheme. They  dont look behind veil. That member job .. it also members property and member wallets. Good luck.


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## Fastmover (Tuesday at 4:12 PM)

mtp said:


> If u keep getting billed U may have to consider going to court .. application under S24 MUD Act to C Court to determine if the service charge u are being billed with was set in accord with MUD Act and C Act.  The liquidator / accountants dont interpert law. They assume OMC well within it power to set s charge and accept or decline participating in a pia scheme. They  dont look behind veil. That member job .. it also members property and member wallets. Good luck.


Hello thanks again for the advice. I’ll definitely look more into that when I have all the information at hand


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