Section 62 of the Strata Schemes Management Act 1996 imposes obligations on the Owners Corporation to maintain the common property in a “good workman like standard”. This function is usually delegated to the licensed strata manager under their agency agreement. Notwithstanding these delegations, the Owners Corporation through its Executive Committee usually approves all repair and maintenance jobs.
Unfortunately, Owners Corporations don’t always fix what needs to be fixed. They either don’t want to fix it now or they don’t have the money to fix it and don’t want to raise the special levys to allow the problem to be remedied. It often places the strata manager in a difficult position regarding repairs which may cause danger if not undertaken.
There are four basic obligations of a licensed Strata Manager:
• to advise;
• to inform;
• to select;
• to arrange.
These are generic objectives and special circumstances may cause a variation from those circumstances. This is a simple mind map that can be followed when considering the obligations of a Strata Manager.
To Advise:
When the strata manager becomes aware of a problem, their first and most fundamental obligation is to advise the Executive Committee.
To Inform:
Many agents think that advising the Owners Corporation abrogates them of any obligations to do anything else. Some think that to tell them of the problem is enough. It is the second obligation to inform which is vital. It is the obligations of the strata manager to provide sufficient iformation to the Executive Committee so that the Executive Committee can make an informed choice. This may require the obtaining of quotes or expert opinions to ensure that the Executive Committee have sufficient information to make the best decision possible. If the Executive Committee decides not to do something after they have been advised and informed of the appropriate action, the Executive Committee takes responsibility.
To Select:
It is the obligation of the Strata Manager to select the appropriately qualified, skilled and insured person. Once the Executive Committee approves work to be done, it is incumbent on the Strata Manager to ensure that the person has the requisite qualifications to do the job. The fact that somebody has a licence is not enough! Just because somebody has a licence, does not mean they can do the job well! It is incumbent on the Strata Manager to undertake sufficient checks to ensure that the qualified person can do the job. This is why strata managing firms have panels. These panels allow the Strata Manager to identify who is good and to select people who have a proven track record. All new persons on that panel should have reference checks undertaken to ensure that the person can do the job.
Finally, the strata manager must always pick a person who has the appropriate insurance, for example, public liability insurance of a minimum of 10 million dollars and workers compensation where applicable. If it is an expert or professional, you should also ensure that they have professional indemnity insurance.
To Arrange:
It is incumbent on the Strata Manager to ensure that all work is arranged expeditiously. It is not enough to merely select the right person, it needs to be done in the right period of time. If it is urgent work, the right person selected needs to do it urgently.
As noted above, these are general principles. If followed in normal circumstances, it will protect the Strata Manager. If there are issues of work which are dangerous, the Strata Manager should do everything in his/her power to convince the Executive Committee to approve the work. There are circumstances that will arise which will call for different things to occur, however this is a very simple starting point to teach your staff.
It is good to do the work! And it is even better to also be protected!
Until next time Bailey Compton and the team from Leverage Australia and The Australian College of Professionlas.
