Caretakers from QLD are concerned about the general lack of support for Resident Managers. Frank Higginson, Hynes Legal provides the following response.
Question: Our Body Corporate did not pay us for services carried out whilst we were Resident Managers. We liaise with 76 other resorts and managers in the area and it seems there is little protection or assistance for the owners of Management Rights.
We have an issue with our Body Corporate not paying us for services carried out whilst we owned the Management Rights in a complex for the last four years. The previous Resident Managers have been paid for these functions.
We have now pointed out all those invoices paid to the previous Resident Managers and Body Corporate still refuse to pay.
We have since sold the Management Rights. We experienced a loss of income from the unpaid invoices, meaning our sale price was also diminished by over $10,000. What recourse do we have?
Since putting in a second request for payment from the Body Corporate we have been told by the Committee chairperson we are no longer welcome at the resort complex.
This has seriously affected the business relationship we have with the new Resident Managers at the complex.
We also noticed during our 4 years, when we extended our lease we paid our legal costs plus the Body Corporate’s legal and administrative costs. We would like to know how the Body Corporate can charge us at a rate of $300 per hour for their services for the required meeting and administration etc. This seems excessive.
We now intend to proceed in forwarding this issue to QCAT for a decision. Are there any other avenues we can seek to further this claim?
We liaise with 76 other resorts and Resident Managers in the area and it seems there is little protection or assistance for the owners of Management Rights.
Thanking you in advance as any advice is appreciated.
Answer: Resident managers are usually paid a fixed sum for fixed duties.
This is all a question of contract and the issue comes up regularly. Resident managers are usually paid a fixed sum for fixed duties. There is always going to be grey about whether those duties extend to some of the things a resident manager does. It is almost impossible to draft a document that covers every single eventuality for a strata scheme.
If the resident manager does work that is outside the scope of their duties then the expectation is that they should be paid for those, but the caveat I put on that is that is that it should be by agreement with the body corporate before the work is performed. In that sense, it is no different from the relationship we have with our clients. We do a job, with a scope for a fee. If what we need to do extends beyond that scope, what we do is go to the client and say,’this has changed, here are the extra costs, do you want us to do it’? and go from there. I think if the same approach was adopted in management rights, it would save a lot of disputes.
In this one, any QCAT application is going to relate to a claim for services rendered and a key part of the claim is going to be whether the work was covered in the caretaking duties, and if not, why the work was done for four years without payment being pursued….
This post appears in Strata News #203.
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