The Mega **Management Company** thread

The_Conductor

Faolchu wrote: »

MUD states 21 days notice for AGMs. anyoen know if this would be 21 calander days or 21 work days?

Calendar days- its the same as company law- you give a minimum of 3 weeks notice for an AGM.

balkanhawk

Hi all,

I have a question that someone may be able to help me with.

Is there anything in the MUD act, or other legislation, that prevents a unit owner from selling a property until they have cleared the outstanding service charges?

Thank you.

markpb

balkanhawk wrote: »

Is there anything in the MUD act, or other legislation, that prevents a unit owner from selling a property until they have cleared the outstanding service charges?

The purchasing solicitor will write to the management company to check that everything is okay and that there is no debt attached to the apartment. If there is, the buyer will generally wait until it's cleared before purchasing. It's not meant to happen but occasionally purchasing solicitors miss the debt and the new owner is saddled with it.

athtrasna

The management company has to provide some documentation for the sale to go ahead...ours won't release that until outstanding fees are paid. It's also a condition of our leases that they cannot be re-assigned without any outstanding liabilities to the management company being discharged.

jd

I had a quick look at the act

8.—(1) Where ownership of a residential unit in a multi-unit
development is transferred, whether by conveyance, transfer, assignment, by operation of law or otherwise, membership of the owners’
management company which arises by virtue of ownership of that
unit shall, notwithstanding any provision to the contrary in the Companies Acts or any other enactment, on such transfer stand transferred to the person becoming entitled to the freehold or leasehold
interest in the unit concerned without the need to execute a transfer
or have it approved by the directors of the company, and such person shall—
(a) be entitled to exercise the powers, rights and entitlement
of a member in the company concerned, and
(b) be obliged to perform all the obligations (including the
payment of service charges) pertaining to the membership of such company concerned.

and

22.—Charges under section 18 and contributions under section 19
or 20, whether requested or sought to be collected separately or
together may be recovered by the owners’ management company
concerned as a simple contract debt in a court of competent
jurisdiction.

I'm a little bit concerned by this. Does this mean that title can be transferred without reference to the management company, and it would then be up to the management company to chase the original owner for any service charges etc due? Or does it just mean that the voting rights and membership of the management company are automatically transferred when the unit is sold?

Paulw

jd wrote: »

I'm a little bit concerned by this. Does this mean that title can be transferred without reference to the management company, and it would then be up to the management company to chase the original owner for any service charges etc due? Or does it just mean that the voting rights and membership of the management company are automatically transferred when the unit is sold?

That means that when a new person buys a unit, then they have the rights of a member of the management company. The 2nd part means that the management company can quickly take a case to court for outstanding fees.

This doesn't change the fact that anyone selling must ensure all fees are paid up to date before the sale can go through.

Chris_5339762

Just in the process of buying an apartment at the moment and stumbled upon this thread. I'm all of a sudden quite worried. While I will of course pay my management fee, the fact that some little twit not paying their management fee could cause my electricity to be cut off is quite galling.

Whats a good list of questions to ask upon buying an apartment? Should I go delving into the accounts of a Management Company to see whether they're in debt or something like that? Would you all actually recommend buying an apartment at all under the current conditions? I had a look on that Apartment Owner website and there doesnt seem to be anything along the lines of 'list of things to do before you buy an apartment'. If people could point me in the right direction that would be great.

athtrasna

Get a copy of the last filed accounts for the Management Company...a few euro spent on cro.ie may turn out to save you thousands.

In general while low funds may affect power to common areas, it would be extremely unusual for power to be cut off to an individual apartment.

DKEV

I have just taken over the bookkeeping of an owners management company. The major problem I am encountering is with the work done by the previous bookkeeper. The previous bookkeeper issued statements to owners stating that they had no outstanding service charges, after auditing all the files I have compiled correct statements for all the owners and it has turned out that some of the owners that got statements stating the had zero balances do actually have arrears on their accounts. These owners are refusing to pay the arrears as the have statements stating they have zero balances.
I know that they have all signed leases stating that the must pay service charges every year.
Has anyone come across a situation like this before, how do i go about prusuing these owners or can I.

madamab

Just wondering with regard to this new law about developers having to hand over the common areas etc. In this development 4 of the blocks of apartments have now been taken over by NAMA.

Our development is a disgrace but the developer owed the Management Company a lot of money and seemingly an agreement has been reached with a monthly amount to be paid. We had our windows cleaned for the first time in years back in March, Our parking is a disgrace. It is a one car per apartment complex because of the bus corridor that is all the council would allow. However people who bought places for investment do not tell their tenants who have 2 cars and though we have yellow lines on the roads the management company tell these people to park anywhere. We live in a set of houses with our spaces outside and as people park directly opposite us it is sometimes very difficult to get in and out of ones space. The management company said they had a vote and clamping was turned down but the houses who are affected the most by the state of parking are in the minority - most of the apartments are let so the landlords do not give a damn. We have been promised a meeting for the last 2 years and it still hasnt happened. I am really interested in ousting this crowd and having an owner run company.

antoinolachtnai

Dkev,

This has not happened to me.

I would consult the auditors and solicitors as a first step. I would be asking the auditors whether they were aware of this and whether they know of any explanation. This is a very serious situation and you need to tread very carefully.

The_Conductor

antoinolachtnai wrote: »

Dkev,

This has not happened to me.

I would consult the auditors and solicitors as a first step. I would be asking the auditors whether they were aware of this and whether they know of any explanation. This is a very serious situation and you need to tread very carefully.

I'd echo this- keeping in mind audited accounts would have been filed on an annualised basis. It is a right mess- I really don't have a solution for you- but you need professional advice on this.

Faolchu

agree with the above comments, who ever audited your books for the last AR should have verified all these balances ao they could note income and arrears due etc. I'd have a word with the auditor and also with the company solicitior as you may have to take legal action to recover the money, or you may not actually be able to recover it. After all the company issued a balance that was bases upon allegedly accurate information. That said if someone lodged 10 million into your bank account and the bank issued you a statement and you withdrew it then they looked for it back you do legally have to return it, that or flee teh country with it. So you could have a case but only a professional can confirm it.

is it a substantial amount? would it be worth writting it off for the sake of good will? if you havent a hope of getting it from the persons that owe it because your comapny at one point acknowleged there was no money owed could the company take legal action against the individual(s) that made the SNAFU? take a civil action against them to recover the cost? that way the members of the MC retain their zero balance, the company firstly saves face and retains its good will with the members and you have a chance of recovering the money anyway through the person that messed up.

DKEV

the funny thing about this situation is that the previous bookkeeper actually gave the auditors the correct outstanding balance for each owner, but for what ever reason the statements that was sent out to the owners showed a zero balance. the audited accounts do have the correct outstanding balances.
The problem amounts I'm dealing with range from 700 to 2000 over 7 or 8 units, this would be a considerable amount to write off, so i'm not overly keen to do this.
Our solicitor has said that because the signed the lease agreements when purchasing the units that the agreed to pay service charges on an annual basis, wether or not the were billed correctly they were aware that fees were due for each year and therefore I should pursue the amount due.

What would you think of this

The_Conductor

DKEV wrote: »

the funny thing about this situation is that the previous bookkeeper actually gave the auditors the correct outstanding balance for each owner, but for what ever reason the statements that was sent out to the owners showed a zero balance. the audited accounts do have the correct outstanding balances.
The problem amounts I'm dealing with range from 700 to 2000 over 7 or 8 units, this would be a considerable amount to write off, so i'm not overly keen to do this.
Our solicitor has said that because the signed the lease agreements when purchasing the units that the agreed to pay service charges on an annual basis, wether or not the were billed correctly they were aware that fees were due for each year and therefore I should pursue the amount due.

What would you think of this

They owe the sums. Just because they were sent an inaccurate statement of accounts does not mean the debt doesn't exist. They have now been sent an accurate statement of accounts. Demand the money- and if they disagree- let them dispute it- thats the course of action I'd take.

They are not members of the Management Company in good standing at present- come what may.

antoinolachtnai

It would be good to get the auditors to confirm by letter that they did not know about these statements.

It would also be good to ask the previous bookkeeper for an explanation.

Now this has all the raw ingredients for a giant libel case so I would be very circumspect about what you say. Time for the professionals unfortunately.

Faolchu

DKEV wrote: »

bookkeeper actually gave the auditors the correct outstanding balance for each owner, .... the audited accounts do have the correct outstanding balances.

did the book keeper issue the balance statements or the auditor? the reason i ask is that if it was the book keeper should they have not seen it before posting?

its obvious there was a computer failure some place so who ever produced the statements needs to check their systems coz this could end up being a costly mistake if someone refuses to pay up and takes it to court.

DKEV wrote: »

this would be a considerable amount to write off,

Agreed, i wouldnt either, be different if the total came to under
2K it might be worth it but

DKEV wrote: »

Our solicitor has said that because the signed the lease agreements when purchasing the units that the agreed to pay service charges on an annual basis,

yes but if you issued them a statement saying there was zero owed they do have a defence, would it hold up in court? no idea to be honest

I'd agree with smccarrick they do owe teh money there is no question, there was simply a process failure that produced an inaccurate statement, it happens all the time, when it does a new statement is issued with the correct balance. But you responsibility would be to figure out where the blame lies for the failure, how the failure occured and what actions have taken place to ensure it doesnt happen again. That way if it ends up in court you can prove the money is actually owed. Their defense will simply be "but this statement says i dont owe it" you need to be in a position to prve that the statement they recieved was issued in error, how that error occured and what is actually owed.

what i'd also recommed doing is issuing a letter to ALL owners informing them of the problem, you dont need to go into details just tell them that there was an error producing statements and you are in the process of verifying balances etc and a new statement will be issued. explain what happened, why and how you resolved it. once you verify all balances issue new statements its a small cost to the company depending on the size. coz but you can be damn sure someone who got a statement saying they owe money will try to claim that statement is also produced in error and they owe nothing just to get out of paying.

if you can pin the blame on someone you might be able to get them to absorb the cost of writing to people because of their mistake, i do it all the time. if our agent forgets to include somethng in a mailing that he has been told to include the i tell him either he spends the day walking to ever house and putting in updated letters or he hires someone but i want the mistake rectified within 48 hours at his expense. so far its worked

Faolchu

the contract with our MA is in the next 3-4 months and to be frank we are not happy with them, and are unlikely to renew the contract.

I'm wondering if people can recomend some agents they feel are worth their salt. Dont post here PM me, wouldnt want teh posts to have been pulled for advertising someone etc.

the problems we're facing:
basically questions are left unanswered or half answered
stuff happens when they want not when they are instructed to do it
important stuff is just let go, like chasing the developer on outstanding snags
their approach to debt colelction is abysmal. their approach is sure let them take as long as they want, theres a recession on, but when it comes to services they recommend we dont cut them because people will be unhappy, but that will just lead us into debt something we've spent the last year or two trying no get ourselves out of.

Lantus

A tricky query.....

We have a MC and up until recently a MA who had decided to pull out. We understand that the apartment block building insurance policy has lapsed and has not been paid. This is partly due to non payment on behalf of the landlords who own these apartments (most landlords live elsewhere.) The developer still runs the MC. Where do we stand and what are the implications if the residents take over the MC in this situation? How do you pay for essential items like insurance if simply no one pays??

Paulw

Lantus wrote: »

How do you pay for essential items like insurance if simply no one pays??

There is no quick easy answer.

You (the Management Company) can take those who haven't paid their fees to court. That is the best way.

You can bring in methods that help assist them in paying (bring in clamping and only those paid up get parking permits). Lodge complaints with the PRTB that the unit owner hasn't paid fees.

Money problems effect all management companies. How you deal with that will generally be your biggest concern.

Lantus

Paulw wrote: »

There is no quick easy answer.

You (the Management Company) can take those who haven't paid their fees to court. That is the best way.

You can bring in methods that help assist them in paying (bring in clamping and only those paid up get parking permits). Lodge complaints with the PRTB that the unit owner hasn't paid fees.

Money problems effect all management companies. How you deal with that will generally be your biggest concern.

cheers for the suggestions.

I wonder where a managment company would stand if there was a fire tomorrow and there was no buildings insurance yet 2 of the 20 apartments say had paid there service fee?

Would notifying the landlords mortgage provider be of any use? I could blanket canvas every major mortgage provider in Ireland providinjg details of the address where there was no buildings insurance. As buildings insurance is a requirement of any mortgage surely they would need to pay up?

Paulw

Lantus wrote: »

I wonder where a managment company would stand if there was a fire tomorrow and there was no buildings insurance yet 2 of the 20 apartments say had paid there service fee?

That could be a very nasty situation. The directors of the management company have a legal responsibility to make sure the company is properly run. I guess a civil legal case could be taken against them, by those who had fully paid their fees.

Lantus wrote: »

Would notifying the landlords mortgage provider be of any use? I could blanket canvas every major mortgage provider in Ireland providinjg details of the address where there was no buildings insurance. As buildings insurance is a requirement of any mortgage surely they would need to pay up?

You would need to consult a solicitor about this. You have Data Protection issues to consider too. Yes, without insurance, they are in breach of their mortgage agreement.

Best of luck though. It's a very bad situation to be in.

wagner

DKEV,
your advice is correct. If for example the Service Charge year end reconciliation was carried out (should be done prior to accounts being audited) and everything seems fine and dandy then each apartment owner is either credited the money not spent or charge their proportion of the over-spend. However, if a contractor six months later sends in a further invoice to the managing agent for works carried out in the previous (now audited) service charge period this should not just be stuck into the following years service charge accounts but distributed among the tenants for the service charge period to which it belonged. This is particularly important in residential management as the turnover of apartments is much greater than in commercial premises.

Your advice is quite right these people are liable under the terms of their lease (a legally binding document) to which they have signed up. if their parking space was taken would they not be the first to quote the terms of the lease and their entitlements. Make sure you make these people aware that they are in fact liable for any cost incurred in recovering the funds which they owe which may double how much is currently outstanding.

Your service charge is billed to you monthly or quarterly based on a budget, it is therefore Service Charge On Account as these figures are ONLY questimates. So while someone maybe able to produce a statement at a given point in time showing their account is balancing at zero, this is fluid and subject to change where change is necessary.

Oh and a common misconception is that "Audited Accounts" are fixed and final is b*ll sh!t. All audited accounts show that 'X' was recieved from tenants, 'Y' was spent by managing agent and 'Z' is the balance.

Hope this is of help.
PM me if you want to go into specifics.

titanium feather

Faolchu wrote: »

agree with the above comments, who ever audited your books for the last AR should have verified all these balances ao they could note income and arrears due etc.

Actually, it's quite likely that the fees were audited on a sample basis. It could be that the invoices that there were problems with just weren't selected as part of the sample. "The auditor is a watchdog and not a bloodhound."

Also, the auditors would probably only have looked at the lease agreements, the invoices issued, and the money received towards the outstanding debt ... as stated earlier, the balances audited were the correct outstanding amounts. The fact that incorrect statements were issued to tenants is a customer service matter and nothing to do with the auditors.

The debts are still owed by the tenants; however the company should acknowledge and apologise for their error, and perhaps offer to allow tenants to pay it off in small installments over time? Or discount it by maybe 10% or so as a gesture of goodwill? Would consult with a solicitor anyways when following up on it.

ur mentor

Lantus wrote: »

cheers for the suggestions.

I wonder where a managment company would stand if there was a fire tomorrow and there was no buildings insurance yet 2 of the 20 apartments say had paid there service fee?

Would notifying the landlords mortgage provider be of any use? I could blanket canvas every major mortgage provider in Ireland providinjg details of the address where there was no buildings insurance. As buildings insurance is a requirement of any mortgage surely they would need to pay up?

Hi

Your idea to inform the mortgage companies is worth pursuing. We advised a few lenders that as the 'tenant' had not complied (paid fees) with the management company (landlord) covenants their property was being removed from the block policy. The response was that about half the usual mortgage institutions got very excited when they heard there was no cover. They contacted the mortgage holder and got them to pay up pretty quick. In fairness to the owner(s) they wanted to pay but banks had arranged that the rent was paid directly into the mortgage account. As a result landlord could not get his hands on it. The banks did release funds to a couple of owners to pay. The rest of the lenders seemed to do nothing at all.
It is usually easy enough to find the lending institutions involved as most of them have had their 'interest' noted on the insurance policy. So the schedule of insurance will help there.


The other half sadly, seem to do nothing.

ur mentor

Paulw wrote: »

There is no quick easy answer.

You (the Management Company) can take those who haven't paid their fees to court. That is the best way.

You can bring in methods that help assist them in paying (bring in clamping and only those paid up get parking permits). Lodge complaints with the PRTB that the unit owner hasn't paid fees.

Money problems effect all management companies. How you deal with that will generally be your biggest concern.

You are correct ..no quick or easy answer. Have you found that the PTRB actually care or do anything?

ur mentor

titanium feather wrote: »

Actually, it's quite likely that the fees were audited on a sample basis. It could be that the invoices that there were problems with just weren't selected as part of the sample. "The auditor is a watchdog and not a bloodhound."

Also, the auditors would probably only have looked at the lease agreements, the invoices issued, and the money received towards the outstanding debt ... as stated earlier, the balances audited were the correct outstanding amounts. The fact that incorrect statements were issued to tenants is a customer service matter and nothing to do with the auditors.

The debts are still owed by the tenants; however the company should acknowledge and apologise for their error, and perhaps offer to allow tenants to pay it off in small installments over time? Or discount it by maybe 10% or so as a gesture of goodwill? Would consult with a solicitor anyways when following up on it.

My suggestions for what it is worth. It is only my view and perhaps it will be disagreed with. Fair enough. A mistake has been made and to get out of it will be tricky.

You should first throw your hands up, apologise, admit the mistake and ask the recipients of the null statement to agree that it was wrongly issued and to accept that they do still own the company money. If they do then say a novena of thanks.

Otherwise you have a battle on your hands. In my opinion. The recipients will use the statement as defence for not paying..of course they will, it is a statement of account issued on management company headed paper by an officer of the company.

I would take every step in the belief that I will end up in front of a Judge,, who in my experience will nearly always tend to agree with (or tend to take the side of) the debtor.

So you need to have a paper trail that is clear, and above reproach, to counter the defence.
Start off by getting the directors to order an investigation into how the null statement was issued. Also get a resolution passed by the directors that the null statements are withdrawn as they were issued in error and the recipients are to be advised of this by registered post. Also get a resolution that each and every company member is to have a full forensic review of their statement of affairs dating back to their first acquisition (or as far as possible) of their property carried out by the company auditor.

Then get auditor (or someone qualified) to investigate what happened and get a short report issued to the Board. Minute their receipt of the report and any disciplinary action taken. Ideally remove book keeper from office or appoint someone else more senior to sign off on everything sent out.

Simultaneously get auditor to prepare for each and every owner a statement going back to the beginning of their ownership (or as far back as they can go). Get this approved by the Board as the factual position and send to eberyone.
If you are still not paid then begin your Court action. Wait two or three years as the null statement owners will probably file a defence. Use the paperwork and the report and Board minutes as your counter to the defence.
You will get your chance to defeat the recipients defence. You still only have a 50/50 likelihood of success in my view. Plus you will have to bring Board chairman, auditor and maybe bookkeeper as witnesses.
So are you sure that you cannot write it off?

ur mentor

Chris_5339762 wrote: »

Just in the process of buying an apartment at the moment and stumbled upon this thread. I'm all of a sudden quite worried. While I will of course pay my management fee, the fact that some little twit not paying their management fee could cause my electricity to be cut off is quite galling.

Whats a good list of questions to ask upon buying an apartment? Should I go delving into the accounts of a Management Company to see whether they're in debt or something like that? Would you all actually recommend buying an apartment at all under the current conditions? I had a look on that Apartment Owner website and there doesnt seem to be anything along the lines of 'list of things to do before you buy an apartment'. If people could point me in the right direction that would be great.

Hi
Get accounts, Look at balance sheet. See item called members funds, or it also may be called reserve or sinking fund. It has a few names. It is usually the last number on the bottom of the balance sheet. Then look at line marked debtors and the associated note.

The first number tells you how much money the company would have if everyone is paid and everyone pays the company. It begs the question then How much this should be? Unfortunately the answer is "it depends". On lots and lots of variables.

The second figure tells you how much is due by members to the company. In an ideal world this is zero and the cash balance is equal to the members funds. Sadly the cash line is usually low and the debtors line high.

Zenga

ur mentor wrote: »

Hi
Get accounts, Look at balance sheet. See item called members funds, or it also may be called reserve or sinking fund. It has a few names. It is usually the last number on the bottom of the balance sheet. Then look at line marked debtors and the associated note.

The first number tells you how much money the company would have if everyone is paid and everyone pays the company. It begs the question then How much this should be? Unfortunately the answer is "it depends". On lots and lots of variables.

The second figure tells you how much is due by members to the company. In an ideal world this is zero and the cash balance is equal to the members funds. Sadly the cash line is usually low and the debtors line high.

Frankly a lot of these lines are more theory than actual fact!! But a good idea is speak with the seller and find out a little more about the developement, take a good look around, if the management company are running low on money they wont be able to continue servicing and repairing the lifts etc.

Faolchu

anyone know what the deal is with smoking in hallways? my neighbour is kind enough to smoke as he walks in and out of the building each and every day. may not seem like a big problem but the smell comes into my apartment and as a non smoker I think its disgusting.