This article discusses a body corporate can fine a caretaker for unsatisfactory performance, and outlines alternative accountability and enforcement options available to committees.
Question: If our caretaker does not perform their duties to committee satisfaction, can there be a monetary fine for not completing satisfactory work?
Answer: The simple answer is no, not to my understanding. However….The simple answer is no, not to my understanding.
I’m an advocate for the committee having their say and being involved and not just accepting things as they stand. The committee can have their say even though there’s not a monetary fine. By communicating and holding caretakers accountable for their performance, you are creating documents sitting on body corporate Records, which then paint a picture for prospective management rights buyers when they do their due diligence.
I’m an advocate for trying to work with your committee, and with your caretakers. I think it’s very important to be commercially minded in how you do this, and I think it’s very important to try to negotiate an outcome whereby both parties interests are protected. If that doesn’t eventuate, you can look at doing remedial action notices. Ultimately, for the caretaker’s purposes, or at least the feedback I get, is that if they have documents sitting on record whether it’s emails, letters, performance, common property condition reports, remedial action notices. All of those documents sit on record. They’re discoverable by prospective purchasers in their due diligence, and ultimately prospective purchasers go ‘Oh, I’m not only coming into an agreement that I have to get on top of all of the new duties and a new scheme and everything else, but I’m coming into a relationship that perhaps is fragmented’. That can be seen adversely by prospective buyers as well.
Prospective management rights buyers would ideally want to come into a scheme where there is a harmonious amicable relationship sitting there with the committee. So, just because there’s not a monetary fine doesn’t mean that you’re not taking steps to make sure that the performance of the caretaker is met – it doesn’t mean that you shouldn’t do that. You should still do that. There are still implied consequences of a caretaker just shrugging their shoulders and walking away from things.
This post appears in Strata News #541.
Jessica Cannon
Cannon + Co Law
E: jessicacannon@cannonlaw.com.au
P: 07 5554 8560
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