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  • #48861
    AvatarPJ
    Flatchatter

    Is there a standard fee schedule that Strata Managers can charge for arranging a contract with a builder? Or is it whatever the Strata manager wants to demand?

     

    #48869
    Jimmy-TJimmy-T
    Keymaster

    There is no standard fee (except for the charge for viewing strata scheme documents).  There isn’t even a standard charge for strata management services.  But it might be in your contract.  If it isn’t, your only protection is the knowledge that you won’t renew if you are being overcharged.  Challenge it and see what happens.

    • This reply was modified 2 weeks ago by .
    #48898
    AvatarPJ
    Flatchatter
    Chat-starter

    Thanks Jimmy…I asked the Secretary to request a Quote from the Strata Manager for services to arrange a contract with the builder. I think this may have short circuited the potential for the Strata Manager to generate charges for services stated as over and above the strata managers role, which has occurred previously. The Strata Manager stated there would be no extra charges “ unless forced to by unusual and unnecessary work”. I presume this means that if the strata manager has to take enquires from owners regarding aspects of the contract then there could be extra charges. I think this is fairly open ended and difficult to prove or refute. The build is a fairly significant one for which owners have had to pay hefty extra levies so the potential for owner enquires / input is high. Is it the norm for a Strata manager to be the one to negotiate with builders and prepare contracts? I was informed it was the Strata managers job but I would have thought that was an owners or OC responsibility.

    #48900
    Jimmy-TJimmy-T
    Keymaster

    It’s only the strata manager’s job if the owners corp via the committee makes it so.  In the majority of cases, the committee mambers may feel that they lack the skills and/or experience to do that properly themselves and delegate the job to the SM.

    In any case, whatever is negotiated has to be approved by the committee or the owners corp as a whole so there is plenty of scope for a committee member to undertake this themselves, knowing that they don’t have the authority to sign off on a deal anyway.

    But in short, it’s up to the committee to decide who does the negotiating and that job would often fall to the SM as they have the skills and experience (or should have).

    #49129
    AvatarBH1
    Flatchatter

    Dear PJ, You say: “The build is a fairly significant one for which owners have had to pay hefty extra levies so the potential for owner enquires / input is high. Is it the norm for a Strata manager to be the one to negotiate with builders and prepare contracts? I was informed it was the Strata managers job but I would have thought that was an owners or OC responsibility.”

    In order to negotiate a building contract that protects the OC, a good knowledge of building law is needed especially for “significant” and/or expensive works. Therefore it is strongly recommended that your OC engages a solicitor experienced in building law to negotiate the building contract, check that all necessary insurances are in place (and there are several kinds needed), check builders’ and sub-contractors licences, and many other legal aspects. The solicitor will be more qualified to answer owners’ queries. The OC will, of course, need to hold a meeting and resolve to engage a solicitor. The only thing the SM would then need to do is send the solicitor a letter enclosing a copy of the minutes showing that the resolution was passed and the SM could charge for that. Your OC will, if course, pay legal fees but for “significant” and presumably expensive building works it’s worth every penny. My OC corporation and a friend’s OC both did this and were saved as the solicitors made sure the contract contained all terms and conditions to protect their rights.

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