Disputes involving resident managers
The legislative jurisdiction for the BCCM Office to determine disputes in a community titles scheme is, in part, limited by the combination of parties to a dispute.
An owner or occupier has standing under the Body Corporate and Community Management Act 1997 to lodge an application against another owner or occupier, or the body corporate. But they cannot bring an application against a person in their capacity as a caretaker, letting agent or service contractor.
The position of caretaker, letting agent or service contractor is derived from the contractual relationship with the body corporate. As such, only the body corporate can be a party to a dispute with someone in that position. However if a caretaker is also a lot owner, they can be a party in their capacity as a lot owner for matters relating to their ownership of the lot.
Applications in the BCCM Office in which a caretaker, service contractor or letting agent is named as a party are infrequent. Often disputes that involve one of these parties relates to a ‘complex dispute’ that will normally be progressed in the Queensland Civil and Administrative Tribunal. (There is an option for them to be resolved by a specialist adjudicator through the BCCM Office but that is uncommon as it requires the agreement of all parties.)
‘Complex disputes’ include disputes about:
a contractual matter about the contract between the body corporate and the caretaker, service contractor or letting agent, including the contravention or performance of the terms of the contract or termination of the contract
a review of the terms of a service contract
the transfer of a letting agent’s management rights
exclusive use by-laws for a lot whose owner has ceased to be a body corporate manager, service contractor or letting agent
lot entitlements adjustments.
While there are few applications in the BCCM Office in which caretakers are named as a party, many applications raise issues involving caretakers and motions relating to a caretaking contract. In particular, many disputes raise perceived issues that the caretaker is not fulfilling their role under the contract or treating owners unfairly.
Decision-making issues affecting resident managers
A common area of dispute involving caretakers is body corporate decision-making. Often those involved in bodies corporate do not fully appreciate that the body corporate legislation sets out clear roles in regard to decision-making.
The primary forum for body corporate decisions to be made is at a validly convened and minuted general meeting. Some matters can be decided by the committee, but only at through properly conducted committee processes.
There is generally no authority in the legislation for individuals to make decisions that bind the body corporate. Individual committee members, body corporate managers, resident managers and so on have no capacity to make decisions for the body corporate. They can’t unilaterally:
- agree to spend body corporate money
- authorise improvements to common property
- authorise someone to undertake work for the body corporate
- issue by-law contravention notices
- approve or refuse permission for pets and so on.
The act specifically states that a body corporate cannot delegate its powers. So neither a body corporate not its committee can delegate the capacity to make a decision to any individual regardless of their position. It is irrelevant if a contract of engagement or authorisation purports to authorise a contractor to make a decision on behalf of the body corporate. The act specifies that the legislative requirements cannot be contracted out of. This means that the act overrides anything in a contract that conflicts with it.
Similarly, any attempt to delegate powers through a by-law would be invalid because the act says that the by-laws cannot conflict with the act.
So it is important that caretakers and others engaged by the body corporate don’t give owners and occupiers the impression that they can make decisions for the body corporate. Rather, they should inform owners and occupiers that they must raise matters directly with the committee or a general meeting.
Avoiding disputes
Anyone who has been involved in a body corporate dispute will know they can be time-consuming and expensive. Even if you are not directly a party to a legal proceeding, you may still be impacted by the dispute.
While the causes of disputes involving resident managers are many and varied, and it is not possible to avoid all disputes, I’d encourage all resident managers to consider what they can do to avoid disputes arising or escalating. The following are some things to consider:
Be open and up front with all owners, occupiers and committee members.
Never underestimate the value of clear and regular communication. Try to remain positive, professional and constructive in your communications, even if others are not.
Avoid getting involved in other people’s complaints and disputes. If you can’t avoid it, try to avoid taking sides. Encourage mediation and negotiation.
Familiarise yourself with the body corporate legislation.
Understand the responsibilities under the codes of conduct in the Act, and understand that those obligations are automatically incorporated as terms of the contract.
Understand your obligations under your contract. Communicate so there is a clear understanding of everyone’s expectations about the contractual duties.
Understand the statutory and contractual limitations on your role. Don’t try to act beyond that role.
Understand that a caretaker has an obligation to all owners and the body corporate, and not just those owners choose to be in the letting pool.
Recognise that there is no legal obligation for owners to let their lots through the body corporate’s authorised letting agent. The onus is on a letting agent to promote the value of their service to lot owners.
Consider seeking professional legal advice if there is a dispute about your contract so that you can be clear on your rights and responsibilities.
