Common areas not taken over by Management Co.

[Dermot]

I have a Management Co. AGM coming up. It is the first Agm. The development company is burst since about 2009. The Management company was "run" by the developer until about 2010. He disappeared and was replaced by close relatives. There was never an AGM held in the 6 years or so of its existence. There is a lot of expenditure that logically cannot be seen where it happened. This expenditure is given under broad headings. Very little detail in the accounts. There would appear to be a "little earner" situation in it for someone. There would be situation where the current Dr's would have very little time for the owners. The Management fees a very high relative to the work that would need to be done. The Dr's will use the company solicitors to protect their interest. There is a view amongst owners that as the Common Areas have not been taken over that the management co should not be collecting fees. What fees if any should be paid to the development co. There is also a part of the estate not finished as well. I am confused

 

[lantus]

The MUD act answers a lot of these questions. Also refer to the ODCE handbook for management companies as its a wealth of knowledge.

Under the MUD act 2011 sec. 18 (2) directors MUST hold an AGM at which accounts and budgets must be approved. There is a huge wealth of info they must prepare covered in section 17.

If you have NOT received notice of an AGM and are been sent bills you have a good case not to pay although the act makes no specific mention of this.

Common area hand over to the OMC is a tricky one. It depends on the specifics. As I understand it in some cases members are required to pay fees to maintain the common areas even before they have been transferred. In some cases not, the developer must maintain them.

There is also he issue of beneficial interest where the developer hands over the deeds of the common areas but retains right of access to undertake any works required. This is handed over some time after.

Under the MUD act all common areas should of been handed over for existing estates in Spet 2011.

There is an additional complication in that your builder (like ours) is now gone.

IF you have an AGM coming up you need to prepare now and start talking to your neighbours.

Get all the details on your articles of association, directors and accounts from the CRO for a small cost. You can replace your directors by giving notice before hand in writing and residents can take over the running of the company. In particular take note of the voting structure (one vote per member? and if you need to fully paid up on fees to vote.) these can severly affect members voting rights. Under the MUD act all the units ownerd by the developer must also be fully paid up as anyone else so know your rights.

There is no easy way, you will need to read like mad those 3 docs.

1/MUD act
2/ ODCE guide
3/ Articles of association.

al are free except last one which will cost 3 quid off the CRO site.

Good luck and let us know how it goes.

 

[Dermot]

Thanks Lantus. Have downloaded of 5 years of accounts and Articles of association plus change of directors forms at the weekend from CRO. I have more than one property there do I still only have one vote. Do you have to give notice before the meeting for new Dr's. I thought you could all this at the AGM

 

[lantus]

Thanks Lantus. Have downloaded of 5 years of accounts and Articles of association plus change of directors forms at the weekend from CRO. I have more than one property there do I still only have one vote. Do you have to give notice before the meeting for new Dr's. I thought you could all this at the AGM

You must nominate new directors prior to the AGM at least 3 days before and I think no more than 28. check your articles and also the ODCE guide which explains this in more detail in the AGM and changing director sections (full guide.). If you wait until the AGM the existing directors stay as they are and there is nothing anyone can do as even if one must resign by the articles they can just be nominated by the existing director and retake their position.

As regards multiple properties and voting thats a good question. Our articles say one member one vote. That would seem to suggest that each person gets one share certificate and one voting right regardless of property's owned. However, this theory hasnot been tested yet. I also need more clarification on this matter.

 

[ontour]

I have more than one property there do I still only have one vote.

According to MUD act there is a vote for each unit but there are also caveats that the voting must be fair and equitable and other voting arrangements can be referred to and determined by the circuit courts.


14.—(1) The voting rights of members in an owners’ management company to which this section applies shall be structured in such a manner that in the determination of any matter by the members of the company one vote shall attach to each residential unit in a multiunit development to which the owners’ management company relates, and that no other person has voting rights in respect of such determination.

 

[lantus]

According to MUD act there is a vote for each unit but there are also caveats that the voting must be fair and equitable and other voting arrangements can be referred to and determined by the circuit courts.


14.—(1) The voting rights of members in an owners’ management company to which this section applies shall be structured in such a manner that in the determination of any matter by the members of the company one vote shall attach to each residential unit in a multiunit development to which the owners’ management company relates, and that no other person has voting rights in respect of such determination.

That doesn't apply to multi unit developments as preferencial voting rights under the companies articles of association can still apply. (In cases where the developer gives himself and his 7 friends (subscribers) 50 votes each regardless. However.....to now use them they must apply to the curcuit court for permission to exercise this right.

See section 12 of the ODCE handbook for full details.

 

[ontour]

That doesn't apply to multi unit developments as preferencial voting rights under the companies articles of association can still apply.

Have any/many such cases been brought to the circuit courts? Have the changed voting rights been upheld?

 

[mf1]

It's all very new - I have not heard of any cases.

In very broad terms.......................

I have dealt with some owners - mainly disgruntled. Much as has already been posted in this forum, I have advised them to get as many other owners involved, to educate themselves on the realities, and to take the steps necessary including a Court application, at their own personal expense, to seek to resolve their situation.

Overwhelmingly, they want someone else to "sort this mess out"- I call it waiting for "the man"!

They do not want to pay - they want "the people responsible" to pay.

Essentially, like children, they want things resolved at no cost to themselves. If I am foolish enough to take the work on without money upfront, they believe that I have assumed responsibility for the problem.

All of which re-inforces for me ( and this is a huge sweeping statement) that Irish people by and large do not have the psyche for communal /apartment living.

I do have sympathy - but this is real life, crap happens. Deal with it.

mf