Question: Our committee wants to engage a specialist to review our management rights holder’s performance and potentially issue a breach notice. Do owners need to be consulted before any of this happens?
Can a committee engage a company to review a management rights holder and issue a breach notice without informing owners? Should the committee consult owners before taking action? The management rights holder is a large company, and from what I can see, most owners are happy with their services.
Answer: A committee can engage a specialist to review a management rights holder’s performance without consulting owners first. Issuing a breach notice as a follow-up is a reasonable course of action.
Yes. To some extent, what you describe is common practice. If a committee thinks a management rights holder is not committee’s spending limit, and it may be reasonable for the committee not to advise owners of this step. If any report into the rights holder’s performance finds they are performing below standard, the committee has various strategies available, but issuing a breach notice as a follow-up is a reasonable course of action.
This post appears in Strata News #798.
William Marquand Tower Body Corporate E: willmarquand@towerbodycorporate.com.au P: 07 5609 4924
