The core duties of a management rights business are usually outlined clearly within the contract. In the majority of cases these duties are well defined and are rarely an issue for the body corporate.
What can become an issue however are disputes over items that are not well defined in the caretaking agreement or are not defined at all. It follows that some owners have a different expectation than others and they may also not be clear on what is required of a management rights business.
If you find yourself in this position it is best to start by assessing where you stand legally. Ensure you are aware of your duties and the expectations written into the caretaking agreement. If you find that you are unclear or unsure on where you stand, it is probably in your best interest to seek legal advice.
Since caretaking agreements can cover such a lengthy period, it is highly possible that the duties currently undertaken differ greatly from the prescribed duties set out in the initial agreement. This is more likely to occur if there has been renovation or modification to existing premises.
In some cases you may find that the duties that should have been included were never included in the original agreement. In the case of ‘off-the-plan’ agreements the prescribed duties may not even be accurate once construction has been completed, requiring review.
If you have legal issues it is recommended to avoid litigation initially and look to resolve through other methods. The easiest way to overcome these issues is to approach and engage the body corporate in open dialogue surrounding the duties expected and those set out. You can come to a compromise and set out a fair agreement surrounding duties. These new duties can then be approved at a general meeting via ordinary resolution.
If you require more information about disputes in a management rights context, please contact Alert Property Group.
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