A NSW owners corporation may engage a licensed strata managing agent to help manage their strata scheme. Unlike the position in Queensland, only a person who is licensed (under the Property, Stock and Business Agents Act 2002) can be appointed.
What are their responsibilities?
An owners corporation can choose the responsibilities of their appointed strata managing agent in negotiating the contract with them (apart from where the owners corporation’s powers cannot be delegated).
A strata managing agent cannot:
- delegate their powers, authorities, duties or functions to others;
- set the contributions to be paid by the owners;
- make a decision on a restricted matter (a matter that needs a special or unanimous resolution, or which the owners corporation has decided must go to a general meeting).
Strata managing agent appointments
A managing agent can only be appointed by the owners corporation by a general resolution. If a strata managing agent has been appointed by the developer before the first AGM, then that appointment ends at that meeting. If a strata managing agent is appointed at that meeting, then they can only be appointed for a maximum of 12 months. After this, any future appointment of them, or another strata managing agent, can only be for a maximum of 3 years, and after this time, a new contract must be entered into.
Extending the term of appointment
The strata committee can extend the appointment of the strata managing agent for successive blocks of up to 3 months after their term would have otherwise expired, but not past the next AGM. This allows the owners corporation time to seek a new strata managing agent, if they wish. If the strata committee does this, and then decides not to re-appoint them, then they must give the strata managing agent at least 1 month’s notice of that decision before their services can be terminated.
If an agent is appointed for the maximum allowed period of 3 years, then their contract automatically includes an option for them to extend their appointment for a further 3 months. The agent has to advise in writing that they will do this, but this is overruled if the owners corporation has given the agent 3 months’ notice that it will not be re-appointing them.
Ending a strata managing agent agreement
When an agency agreement is due to end, a strata managing agent can be dismissed by a majority vote at a meeting of the owners.
An owners corporation may at any time resolve at a meeting to terminate the agreement based on its terms, or apply to the NSW Civil and Administrative Tribunal (the Tribunal) for an order to:
- terminate the agreement;
- require compensation to be paid;
- vary the term or a condition of the agreement, or declare a term of appointment void;
- require a particular action to be taken, or not taken, by a party to the agreement.
Gifts, benefits and commissions
A strata managing agent must not request or accept a gift or benefit valued at more than $60.00 through their role in the strata scheme. Otherwise, they could be fined up to $2,200.00, or disciplinary action could be taken.
At the AGM of the owners corporation, the strata managing agent must also report if their current role in the strata scheme has earned them any commissions (not disclosed in the agency agreement) or training service benefits:
- during the last 12 months;
- likely to be received or paid for in the next 12 months.
Liability limited by a scheme approved under Professional Standards Legislation
Disclaimer – This article is provided for information purposes only and should not be regarded as legal advice.