A NSW lot owner would like to know the procedure for renewing the management agency agreement. Rod Smith, The Strata Collective provides the following response.
Table of Contents:
- QUESTION: Is the strata managing agent required to ensure they deduct invoices paid on behalf of the owners corporation from the correct fund?
- QUESTION: After the committee members have signed the management agency agreement, who has the right to hold a copy of the agreement?
- QUESTION: When renewing the management agency agreement, should the managing agent include all items on the agenda to be discussed at the AGM? Can they insert their fixed term prior to the AGM?
Question: Is the strata managing agent required to ensure they deduct invoices paid on behalf of the owners corporation from the correct fund?
Is the strata management company obligated under the conditions in the management agency agreement to ensure the invoices they pay on behalf of the owners corporation are allocated correctly to either the admin or the capital works fund? Are they required to ensure they deduct the invoice amount from the correct fund?
Answer: Yes. A strata managing agent is responsible for the accurate management of the books and records of a strata scheme.
In short, yes.
A strata managing agent is responsible for the accurate management of the books and records of a strata scheme, including the management of the financial records and transactions of the owners corporation, where they have been provided authority to do so under an executed strata management agency agreement.
A strata management agency agreement is required to include a schedule of the agent’s authority to act on behalf of an owners corporation and whether there are any limitations to that authority, pursuant to Schedule 4, Clause 2 of the_ Property Stock and Agents Regulation 2022 (NSW).
_Where the strata managing agent has the delegated authority to undertake the financial management of the funds and books of accounts for an owners corporation, the agent is required to comply with the requirements for the use of each fund outlined under Part 5, Division 1 of the Strata Schemes Management Act 2015 (NSW). Specifically, Sections 73 and 74 of the Act outline the owners corporation’s responsibility (and the agent’s responsibility, by delegated authority) to pay money from each fund for their intended purposes. Where an agent has not complied with the requirements of the Act in accounting for the payment of invoices to the correct fund on behalf of the owners corporation, the agent may be in breach of the strata management agency agreement.
Andrew Terrell Bright & Duggan E: Andrew.Terrell@bright-duggan.com.au P: 02 9902 7100
This post appears in the February 2024 edition of The NSW Strata Magazine.
Question: After the committee members have signed the management agency agreement, who has the right to hold a copy of the agreement?
After the committee members have signed the agency agreement, who has the right to have a copy of the agreement beside the secretary of the scheme?
Answer: The Management Agency Agreement forms part of the books and records of the Owners Corporation.
The Management Agency Agreement forms part of the books and records of the Owners Corporation. An owner is entitled to perform a search of the books and records at the prescribed cost of $34.10 per hour. This should be arranged directly through the strata manager.
Rod Smith The Strata Collective T: 02 9879 3547 E: rsmith@thestratacollective.com.au
This post appears in Strata News #426.
Question: When renewing the management agency agreement, should the managing agent include all items on the agenda to be discussed at the AGM? Can they insert their fixed term prior to the AGM?
When renewing the management agency agreement, should the managing agent include all items on the agenda to be discussed at the AGM? Can they insert their fixed term prior to the AGM?
If a Managing agent wants to change the structure of their management costs should they not include it on the Agenda and also discuss it with the owners corporation at the AGM?
Also if they want a fixed term of 3 yrs should this also not be discussed at the AGM and included in the Agenda?
Can the Managing Agent also type up their agreement with the fixed term inserted before the AGM?
The Motion on the Agenda was just for reinstatement of another fixed term which we have of 1 yr.
I have just received after asking for the 2018 Management Agreement to find out that they have got themselves 3 years.
Answer: The agreement should be sent with the agenda however it is not required to be circulated beforehand.
The agreement should be sent with the agenda however it is not required to be circulated beforehand. The agreement is able to be tabled at the meeting if the motion states that the agreement is to be tabled and accepted.
Yes, if they want a fixed term of 3 yrs this can be discussed at the AGM and included in the Agenda. Please see above. You can require an amended term down to one year. All that would need to happen is, you cross out the words ‘3 years’ and handwrite and initial ‘1 year’ in the agreement.
The Managing Agent can type up their agreement with the fixed term inserted before the AGM. However, this can be changed at the meeting.
Rod Smith The Strata Collective T: 02 9879 3547 E: rsmith@thestratacollective.com.au
This post appears in Strata News #358.
This article is for reference purposes only and is not intended to be a comprehensive review of the developments in the law and practice or to cover all aspect of the subject matter. It does not constitute legal or other advice and should not be relied upon this way. Readers should take legal or other advice before applying the information containing in this publication.
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