Strata scheme owners are legally entitled to choose self-management, but there are benefits linked to choosing trained third-party managers including specialist knowledge pertaining to the legislations. The regulations that govern strata schemes, such as those outlined in the Strata Schemes Act 1973 and Strata Titles Act 1975, are complex and highly technical. Without proper interpretation and compliance, your property will be unprofitable and the owners could be exposed to legal and financial liability. Moreover, the professional services are more time-efficient and they can offer impartial advice. It is important to understand the terms of engagement of a strata manager for efficiency in the operation so here are the important pertinent details.
The owner's corporation can delegate specific duties to the manager by ordinary resolution. You should understand the scope of duties outlined by the Strata Titles Act before official engagement to avoid violations and frustration. For instance, the manager cannot fill a role that requires unanimous corporation resolution. The common management duties encompass a variety of fields including accounting, clerical and legal. The professional may be required to collect money owed to the corporation and pay any debts. They can also hold money or other assets and make financial investments on behalf of the owners. Preparation of the account statements and presentation of the data regarding past and proposed expenditure may also be delegated. The strata manager can enter into insurance contracts with reliable providers and organize for the structural maintenance of the properties. Additionally, they can keep records and prepare minutes as well as issue notices and offer advice pertaining to Strata legislation.
The appointment of a strata manager can be entrusted to a management committee but it is advisable for the duty to be handled in a general meeting. It is important to ascertain that the potential manager has experience that matches your strata plan. For example, it would be ill-advised to engage an individual who manages ten residential blocks for management of an elaborate complex of commercial and residential units. In addition, they should show serious commitment to acting in the best interest of the corporation as outlined in the Strata Titles Act.
Ending the Contract
The contract of appointment should be specific about the term of service after which the contract may be renewed or terminated. However as the owner's corporation, you may end the contract if the performance of the manager is unfavorable. You should seek legal advice because if terms of termination are not agreed upon, the dispute resolution process will include the Magistrates Court.
For more information, contact Strathfield Strata Management Pty Ltd.