When you break down the word “caretaker” it sounds like a good thing. But is strata it can often mean somoene who’s supposed to take care of you and your building but whose main priority is paying off a debt and looking after number one.
QUESTION: Our on-site caretakers are selling their business after two years in the job and are asking the owners corporation for an extension to their agreement to top it back up to 10 years.
Our executive committee are opposing this, telling the owners that we should let the original contract run its due course and expire. Now we have all received letters from the caretaker with a sample proxy form suggesting how to vote and the name of an owner to vote for.
Caretakers cannot hold proxies when they have a financial interest, so is this a proxy by stealth? – Careworn, Sydney
ANSWER: Your executive committee needs to ask every owner to either not sign that proxy form or, if they have already done so, to sign another supporting them (which will over-ride the previous one).
Why should they do this? Because signing up for a contract extension is effectively giving the caretaker money for nothing.
Although some strata caretakers do a fine job, the caretaker system in modern strata buildings is an anachronism and often a rort.
It starts when the developer sells an apartment along with the rights to manage the building. Only later do the owners realise they have saddled themselves with a 10-year contract in which, often, the only clause that’s watertight is an ever-increasing set of fees.
The fees are how the caretakers get the money back that they paid to the developer or the person they bought the business from. They have little to do with how much or little work they do – they’re about putting money in developers’ pockets.
So your neighbours need to ask themselves this: why would you sign a contract with anyone that guarantees nothing except that they will make a profit at your expense?