What to do when directors don't reply

R3alEstate

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56
Hi,

I wanted to ask if there is an entity that a member of an OMC can refer to when the directors don't do their job and there are problems like bad owners who don't pay, services not provided or other issues of any kind.

Thanks

Katrina
 

Zenith63

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491
The OMC is ‘owned’ by you the members, and you the members appoint your Directors to run the company. Worth keeping this firmly in-mind; it is your company, it answers to you but you are also responsible for it.

An AGM must take place each year at which you should get to vote on new Directors. If the Directors are genuinely not contactable, you would (broadly) get the required number of paid-up members together and schedule an EGM at which you would vote out the existing Directors and yours in. The process is usually covered in the constitution of the company which is available to you from the CRO. You could do it yourself, but a solicitor would be useful. If another route is open to you, like getting the old Directors to respond, it would be much easier and cheaper!!
 

Palerider

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1,495
There really is no one to complain to, in theory you could complain to the Director of Corporate Enforcement or the Companies Office but in reality it would get you nowhere.

Attend the next AGM or EGM, contact the managing agent for a timeline on this meeting, put yourself forward as a Director, have somebody there to second your nomination, Directors can only stand I believe for 3 years ( ? ) before resigning and putting themselves forward for reelection, if any of the rubbish Directors do resign and put themselves forward then object and vote against it.

Not easy being a Director, I was that soldier, I would not take it onboard again unless most owners had an interest in the property, good luck to you.
 

Threadser

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236
Is there a managing agent in place? Most developments appoint an agent to work on behalf of Directors who manages communication on their behalf. I am a voluntary Director of an OMC. On the advice of our company solicitor we don't answer emails from residents but pay the agent to do so on our behalf.
 

R3alEstate

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That's good to know. Are the agents bound to answer or they can also ignore you?

Thanks,

Katrina
 

Zenith63

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491
That's good to know. Are the agents bound to answer or they can also ignore you?
The agent is basically just a private maintenance company, and are appointed by you the members to do much of the work of running the company for you. They should be courteous in responding to you, but just keep in-mind they will be charging the OMC a fee to do their work on the basis that they don’t have to interact with each and every member individually. So in my experience they will respond to one or two questions, but if it goes much beyond that they’ll probably refer you to the Directors.
 

R3alEstate

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OK, now I'm confused :)

Threadser said that Directors don't answer questions but rely on agents while you seem to think the opposite.

If I could afford an house I would run away from the apartment idea at this point, unfortunately I can't :/
 

Zenith63

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491
OK, now I'm confused :)

Threadser said that Directors don't answer questions but rely on agents while you seem to think the opposite.
There aren’t any rules for all this really, so it completely depends on the agent and Directors, how many problematic members they’ve encountered etc.

In the case of the OMC I’m a Director of, there are some difficult members who deliberately ask a lot of questions. If it gets too much for the Agent, they’ll ask the Directors to contact the member and explain to them that the Agent cannot be expected to answer lots of questions for the fee they’re receiving.

If the Directors are not responding to you, try the Agent and see what they say. If you can do a call where they might give you the lowdown that would be best, they may say the Directors are useless and encourage you to replace them for example. But just keep in-mind they’re just a private company that you’re paying, so there’s limits to their obligations.
 

R3alEstate

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56
Hi, I've found online the documents for an MC that manages an estate I could be interested in.

On one of them there is a balance sheet that reports:

Current assets 138,419
Creditors: amounts falling due within one year (84,194)
Net current assets 54,225
Capital and reserves 54,225

what do you understand from that?

Thanks,

Katrina
 

Threadser

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236
Just to clarify my comments regarding communication with residents. All volunteer Directors in my estate (150 units) work full time in other jobs. It isn't practical to spend the evenings responding to resident's queries so the day the day communication is the remit of the managing agent who is being paid to provide this service. At times the agent will consult us on any queries that require our input and we will direct her how to respond. Our solicitor is an expert on Apartment Law and she has advised us to avoid responding in a personal capacity to any queries. Regarding the figures above very often accounts are filed a year in arrears so you really need an update on the current figures. I would suggest finding out how much is currently in the sinking fund and how much outstanding debt there is. This will give you an up to date picture of the current financial health of the MC
 

Palerider

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I'm not sure that anybody buying into a development will get accurate information, I certainly did not, after I bought I challenged the agent when It was disclosed there were 10k+ arrears on one unit undisclosed, he told me I was neither an owner or Director when I was making enquiries, all with a straight face, he also told me all units were current, Also false.

I accept I may have had the worst experience but it was a lesson for me that Im happy to share, thread carefully is the message for apartment buyers in this country and if you buy get involved in the OMC.
 

R3alEstate

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56
I simply don't understand how this can happen, why it's not possible to force bad owners to pay?

That said I understand the figures are not up to date but assuming they are, is there someone that could explain me what they mean? I don't have a clue.

@Palerider, what did you do? Did you sell and bought an house or was the issue solved?

Thanks,

Katrina
 

Palerider

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1,495
I came across a willing buyer and was delighted to sell the apartment, as a Director who was the only one of three Directors to care and contribute with all other owners being absentee well twas a relief let me tell ya.

I will never buy another apartment and my children won't be let either, it is well worth getting control of your front door with zero uncontrollable management fees and not having to share the common areas, I would say save like mad and buy a house.
 

elcato

Moderator
Messages
3,419
Current assets 138,419
Creditors: amounts falling due within one year (84,194)
Net current assets 54,225
Capital and reserves 54,225
It means they have 138,429 in the bank but have bills outstanding which are due of 84,194. The Net current assets is the second subtracted from the first. As the last figure is the same as current assets then it appears that they don't have a sinking fund as that should appear under capital reserves and funds and be added under the Capital and reserves heading I believe.

Note: I am not an accountant so instruct your solicitor to ask them.
 

R3alEstate

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56
ok thanks, not having a sinking fund it seems like a big deal to me :(

so if I got it right what they really have is 54,225 without a sinking fund.

I've also found the following: Notes to the abridged financial statements:
appropriations of profit and loss account

at start of the financial year 34,112
(loss)/profit for the financial year (6,104)
at the end of the financial year 28,008

what does that mean?

Too bad I was asking for more information to the agent but as you already said I was told that I can't ask because I'm not an owner.

It really doesn't make any sense, it seems a system thought to allow frauds!
 
Last edited:

Namdos

Registered User
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22
ok thanks, not having a sinking fund it seems like a big deal to me :(

so if I got it right what they really have is 54,225 without a sinking fund.

Too bad I was asking for more information to the agent but as you already said I was told that I can't ask because I'm not an owner.

It really doesn't make any sense, it seems a system thought to allow frauds!
No surprise if there is no sinking fund. Huge amount of OMCS reduced these to cut down the bills over the years or had credit control issues and did not allow for them and the ramifications of doing this are only coming to light now.
 
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