Question: As building managers, should we be reimbursed for items needed to complete works required under the caretaking agreement?
We are the building managers of a unit complex. There is a requirement for us to purchase goods and services to complete works required under the caretaking agreement. Our body corp does not supply all items.
When we seek reimbursement for these items, the strata manager advises ‘Your management agreement pays you remuneration for a supply of service which is inclusive of GST.’ So essentially they are saying that our management agreement payment covers the costs of all goods/services we purchase for the management of the building. Is this correct?
Answer: What does the management / caretaking agreement say?
This whole thing hinges on what the management / caretaking agreement says. The usual position is that the body corporate bears the costs of consumables (i.e. fuel, fertiliser, etc) and then equipment is sometimes borne by the caretaker and sometimes by the body corporate.
The other issue that often comes up is when a caretaker engages someone to do a job and there can be confusion about whether the caretaker or body corporate bears the cost of that. That then turns on what actual duties the caretaker must perform. If a caretaker engages someone to do a job their agreement says they must perform, then it is at the caretaker’s cost. Otherwise, it should be the body corporate’s cost but ideally, after the body corporate knows that is the case. This is quite often then coloured by whether the job is a ‘skilled trade’ which might be something a body corporate has to bear.
Each contract is different. The answer to the question will more than likely rest with interpreting all of the above.
This post appears in the April 2021 edition of The QLD Strata Magazine.
Frank Higginson
Redchip Strata Law
E: FrankH@redchip.com.au
P: 07 3193 0500
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