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If I might be permitted, the dirty little secret referred to can have, as suggested, catastrophic effects on an Owners Corporation, and thereby hangs this tale. In the telling of it, other OC’s might benefit from the experience.
Our OC is 15 years old, and in the setup process, of course there was a certain amount of venality involved. The developer sold off the caretaker rights, before the OC came into existence, to recoup some of his costs, as was his right. However, the contract he set up contained no hours of duty, no hourly rate of pay and the ability of the OC to exert supervisory control was in effect practically nil. The point about our caretaking contract is that it was written without any input from the OC.
Our first caretaker, installed by the developer, was a hard-working, conscientious man who was an asset to the OC. This person assigned the business by sale after 2 years to our current caretaker. For 6 years, the current caretaker was also conscientious and helpful, but then after 6 years, all hell broke loose.
His first sally was to demand at an exectuve committee meeting, approval for an increase in remuneration. At the same meeting he presented an evaluation which he had funded which purported to show that there should be a 60% increase in his remuneration!!! The response of the committee at the time was that a response would be forthcoming when the committee had had time to consider the matter, and it would also need to be put to a General Meeting. Needless to say, the committee did not accept the demands of the caretaker.
Within a month, the caretaker had escalated the matter, and instead of using the dispute provisions within the contract to settle the matter, lodged a claim in the state industrial relations court.
Despite the OC being prepared to negotiate the matter before it went to court, the caretaker refused, the matter went to court, there followed four years of legal catastrophe, with the result that the matter was decided in favour of the OC (which actually set a precedent in IR documentation), the caretaker spent $150,000, the OC, in spite of winning, had costs of $40,000, and we now have a totally hostile caretaker who has neve accepted the verdict of the court and has waged guerilla warfare on the EC and the OC ever since, which now amounts to 6 years of helland disruption.
The situation is that the caretaker has managed to disrupt the work of the EC to the extent that OC members do not wish to serve on the committee, hours are spent on petty points of order and legal challenges to actions of the committee and the goodwill which facilitates the effective functioning of OC’s is exhausted.
There is much more detail with which I won’t bore you, but to suffice to say the effect is horrifying. A good 50% of OC time is now spent reacting to manouvers of the caretaker, who is taking his revenge by disrupting wherever possible, the functioning of the OC.
The lessons?
1. Governments should act to prohibit the situation where a caretaker can also be a member of an OC, because of the potential conflict of interest, and the possible manipulation of the OC.
2. OC’s should always be allowed to set the terms of any caretaking contract, without having a contract foisted on them by a developer.
Same old same old, and as Jimmy points out, niether the government nor Fair Trading are interested in addressing the issue.
I am a new member of this forum and this is my first post, so please excuse any faux pas or guacherie, but I have a query about this article, which I have also raised with JT.
In the answer section of the column it is stated that 'They (EC) can take action against the owner for failing to manage their tenant properly'.
My question is, can an owner be held responsible for the behaviour of a tenant, and if this is so, there must be some legislative reference for this. I cannot find any such reference in the Act or the Regs and I was wondering if anybody knows the reference.
A problem arises where an OC decides to take an owner to the CTTT, for the behaviour of their tenant. It seems to me that such an owner would be in position to say to the CTTT that he was not the one to breach the by-laws, and therefore cannot be held responsible.
I am aware that tenants can be held responsible for their breaches of the by-laws, and can be taken to the CTTT with due process, but what happens in the circumstance where there is a tenant's name on the lease, and that tenant is rotating other residents through the property (I guess subletting without any contract) on a short term basis, for example weekly or fortnightly, and any or all of those residents breach. Tenants should also be signing lease agreements which include a clause about compliance with the by-laws, but I am also sure that doesn't always happen either.
Any comments?