The Labour Party used its last 2008 allocation of Private Members’ time to raise again the urgent need for legislation on property management companies. Speaking after the private members’ debate, Deputy Joan Burton called on the Government to finally bite the bullet on management companies and bring forward the long promised and much needed legislation.

The Labour Party motion had called on the Government to publish as a matter of urgency a Bill, based on the draft provided by the Law Reform Commission back in June of this year, aimed at reforming the law on management companies

“Having been promised legislation on property management companies ‘as soon as possible’ for over two years, it is still no closer. The Government appears completely at sea on the issue and still don’t even know whether it requires one piece of legislation or three. When this Government says ‘as soon as possible’, what they seem to mean is ‘whenever we get around to it’.

“This is kind of foot-dragging is typical of our do-nothing Government.

“While some people are quite happy with their property management company, their are unfortunately many more who are not. With an explosion of new housing development in Dublin 15 in the last decade, it is understandable that many of the people affected find themselves in this area.

“People contact me on a daily basis with concerns about their management company. The Government have know about these problems, and have known that new legislation is needed, for many years now but have sat on their hands. I have brought this issue up in the Dáil on many occasions, and I’ll keep pushing when the Dáil resumes in the New Year, but the Government doesn’t seem to want to listen.

“Thousands of people in homes across Dublin 15 are caught in a nightmare management company trap. They pay sometimes huge fees, often for a very poor level of service in return. The sector remains completely unregulated and cowboy developers and their agents are running rough-shod over homeowners.

“There is no regulation to protect people from being fleeced.”

Having been promised legislation on property management companies ‘as soon as possible’ for over two years, it is still no closer. The Government appears completely at sea on the issue and don’t even know whether it requires one piece of legislation or three.

Responding to a Labour Party question on November 12th an Taoiseach, Brian Cowen, told the Dáil that it should be one bill. However, responding yesterday to my parliamentary question the Minister for Justice, Dermot Ahern, provided a nonsensical reply (below)saying that ‘The Government’s decision on the matter will be made on the basis of how quickly the required legislation can be enacted’.

We are still none the wiser. When this Government says ‘as soon as possible’, what they seem to mean is ‘whenever we get around to it’.

Meanwhile, thousands of homeowners across Dublin 15 and around the country are left paying extortionate management fees for often sub-standard services.

QUESTION NO: 324

DÁIL QUESTION addressed to the Minister for Justice, Equality and Law Reform (Mr. Ahern)
by Deputy Joan Burton
for WRITTEN on Tuesday, 25th November, 2008.

* To ask the Minister for Justice, Equality and Law Reform if he will confirm that property management companies are to be legislated for with a single Bill rather than three separate Bills as had been previously indicated with respect to the comments made by An Taoiseach in Dáil Éireann on 12 November 2008 regarding management companies; when he expects the heads of this Bill to be drafted; if he will commit to having the Bill published and enacted before the end of July 2009; and if he will make a statement on the matter.

– Joan Burton

REPLY.

The Deputy will be aware that this is a complex issue which involves a number of Government Departments. The Government is determined that its Strategy for Multi-Unit Developments will be effective and comprehensive.

To that end, work on the preparation of legislative proposals to respond to the Law Reform Commission’s recommendations concerning multi-unit developments and the regulation and governance of property management companies is under way across a number of Departments.

Options are being considered in consultation with relevant Departments and the Attorney General as to whether it would be more expeditious to introduce a single Bill or to adopt a sectoral approach to amending existing legislation.

The Government’s decision on the matter will be made on the basis of how quickly the required legislation can be enacted.

Deputy Joan Burton today challenged the Minister for Finance in the Dáil today on when the Government was due to legislate for property management companies. The Government have been saying for well over a year now that this urgent issue will be dealt with ‘as soon as possible’, yet there is still no sign of the legislation. The Minister gave no indication as to when the legislation would be finalised.

Deputy Joan Burton: I ask the Minister for Finance – the previous Minister for Justice, Equality and Law Reform – what the timeframe is for legislation relating to property management companies.

This issue is very difficult for tens of thousands of people who are in properties subject to property management companies. They cannot even address matters where there are serious defects in a property, as there are in many such properties. These people have no legal remedy to take control of the management company and get work done. Many people are sitting in property managed by companies who cannot sell their properties because of defects in the structures.

Can the Minister tell us what the Government intends to do?

Deputy Brian Lenihan: Options are being considered in consultation with the relevant Departments and the Attorney General as to whether it would be more expeditious to introduce a single Bill or to adopt a sectoral approach to amending existing legislation. A Government decision on the matter will be made on the basis of how quickly the required legislation can be enacted. The main features of the legislation were outlined in a strategy on foot of a Government decision taken on 23 September this year.

This legislation will be prepared by the Government as soon as possible.

The Irish Property and Facility Management Association (IPFMA),through its Residential sub committee, has prepared and released a welcome Position . Paper on Residential Multi-Unit Development and Management

The Government yesterday published its legislative programme for the coming Dáil session. Still, there was no sign of forthcoming legislation on management companies. This will be bitterly disappointing to all those living in managed estates and appartment complexes and to all those campaigning for change.

The NCA has just launched a new consumers’ property information website. It contains all you need to know about buying a home, management companies, house rules and much more. In particular, it’s downloadable guide to management companies is packed with information.

This website is a useful and timely addition to the consumer’s armoury. Buying a home is not for the faint-hearted, and having accurate info at your fingertips is absolutely essential.

The Dublin West Labour Party held a highly successful public information meeting on property management companies on Thursday, 18th September in the Tyrellstown Park Plaza Hotel. There were over 50 people in attendance from areas as diverse as Ongar, Clonsilla, the city centre and Tyrellstown itself.

There were presentations from Adrienne Roche, resident of Allendale and management company activist, and from Gavan Carty, a solicitor with particular expertise in the area.

The presentations were followed by a lively Q&A session. The sense of frustration was palpable. People across Dublin 15 are sick and tired of paying exorbitant management fees for very little in return. Developer controlled management companies, people said, are an information vacuum. Management fees are often at low ‘teaser’ rates for the early years before being jacked up when all units in the development have been sold.

Deputy Joan Burton has been a leading advocate the urgent need for management company legislation in the Dáil, raising the matter on an almost weekly basis. Speaking at the meeting, Deputy Burton gave a commitment that she would continue harrying the Government until the necessary legislation was passed: “For too long, cowboy developers have been able to get away with murder. This has to stop.”

Adrienne Roche and local Latchford residents’ committee chairperson Conor Deane informed the meeting that they are putting the finishing touches to an information website about management companies and they expect the site, www.right2manage.ie, to go ‘live’ in early November.

Do you feel short-changed by your property management company?

Are you paying super-sized management fees for sub-standard service?

Or has everything gone smoothly?

Whether your experience has been good, bad or indifferent, we want to hear from you.

Click Here to take our survey

All entries will be kept fully confidential.

If you would like to raise any issue relating to management companies, or any other issue, don’t hesitate in contacting Joan: joan@joanburton.ams2-c6-1.anuhosting.net / 01 618 4000

There is now only one sitting week remaining before the Dáil recess (the Labour Party had sought a significant increase in the number of sitting days ). With that time being dedicated to debating the worsening economic situation, it appears that the Government is not now going to bring forward legislation on property management companies before the recess. Deputy Joan Burton had previously been given a series of public assurances by members of the Government that this legislation would be brought before the Dáil before the recess.

Deputy Burton has this week received a most unsatisfactory reply to a series of questions (questions and reply below) on the management company issue. With the Law Reform Commission having now published its final report and recommendations for legislation in the area, there is now no excuse for further Government prevarication. It is particularly disappointing that the Minister has not agreed to introduce interim measures to give some relief to the many homeowners suffering under the un-regulated management company regime where they often pay huge, unjustified fees for a very poor service in return.

QUESTION NOS: 523 to 525

DÁIL QUESTIONS addressed to the Minister for Justice, Equality and Law Reform (Mr. Ahern)
by Deputy Joan Burton
for WRITTEN on Tuesday, 1st July, 2008.

* 523. To ask the Minister for Justice, Equality and Law Reform his views as an interim measure, pending the report of the High Level Inter-Departmental Committee on Multi Unit Developments, on imposing a requirement on management companies and management agents to provide clear and immediate information on their operations to the occupants, both collectively and individually, of multi unit developments for which they have undertaken management responsibilities; and if he will make a statement on the matter.

– Joan Burton

* 524. To ask the Minister for Justice, Equality and Law Reform the number of occasions on which the Inter-Departmental Committee on Multi Unit Developments, which is chaired by his Department, has met to date; the date it last met; and when he expects the Committee to issue its final report.

– Joan Burton

* 525. To ask the Minister for Justice, Equality and Law Reform if his attention has been drawn to the fact that the Law Reform Commission has recently published its final report on multi-unit developments; if he will make a statement on the recommendations contained therein; if he will fulfill previous commitments that legislation on multi-unit developments would be brought before Dáil Éireann before the summer 2008 recess; and the timeframe for the publication, debate and enactment of this legislative package.

– Joan Burton

REPLY.
I have already indicated in response to Parliamentary Questions that the high level interdepartmental committee on multi-unit developments has been established to identify the legislative and administrative actions that should be taken in response to recommendations made by the Law Reform Commission on the matter. The interdepartmental committee met on 7 occasions to consider the preliminary proposals which were set out in the Commission’s Consultation Paper. Since then the Committee has had its first meeting to consider the Commission’s recommendations – 70 in total – that are contained in its Final Report that was published on 24 June last. The Committee is in the process of establishing a programme of work in response to the recommendations as a matter of priority. The Commission’s Report is a wide ranging document involving reforms across a broad range of policy areas including planning and development law, tax law, company law, the law relating to registration of ownership of land, the jurisdiction of the courts and other related areas.

My Department is already engaging with the Property Registration Authority/Land Registry to examine the recommendations made, for example, in relation to the registration of title for multi-unit developments. The Department of Enterprise, Trade and Employment is examining the recommendations for the strengthening of company law. In so far as issues relating to consumer information and general awareness in the area of multi-unit developments are concerned the Minister for the Environment, Heritage and Local Government has already welcomed the new publication launched by the National Consumer Agency to address the need for consumers to understand the issues around multi-unit developments. This followed on from the work at the stakeholder forum on which his Department and other key organisations were represented.

I should also mention that the National Consumer Agency has agreed a Code of Practice for developers of multi-unit developments with the Irish Home Builders Association. This Code outlines the responsibilities of developers regarding ownership, management and maintenance of common areas and the provision of common services within such developments. It also addresses areas such as the establishment and operation of the management company, the use of property managment agents, the calculation of service charges and establishment of a sinking fund.

Deputy Joan Burton has welcomed the publication by the Law Reform Commission of its final report and legislative recommendations on property management companies, saying that the onus is now on the Government to bring forward legislation. Issues relating to management companies and their agents impact significantly on the lives of many people in the newer residential developments in Dublin West, particularly in areas such as Ongar, Tyrellstown, Allendale and Littlepace.

“With the publication of the Law Reform Commission’s (LRC) Report today, the framework is now there for bringing forward the relevant legislation. The onus is now on the Government to fulfil its promise to bring this legislation forward before the upcoming Dáil recess. Ministers must now get their act together on the issue of management companies legislation.

“Perhaps the most important innovation proposed by the LRC is the establishment of the ‘Owners’ Management Company’ (OMC), a specially tailored company to which the property developer would be legally required to transfer the legal title of any new development. Such a company would be structured on a strict ‘one vote per residence’ basis with the prohibition of ‘weighted voting’. Weighted voting is a cynical mechanism that unscrupulous developers have used in the past to maintain control over management companies despite only retaining a small proportion of the residences. It is proposed that all management agents be regulated by the National Property Services Regulatory Authority.

“While the Law Reform Commission recognises that not all its recommendations can be implemented retrospectively, it does propose several important innovations for those in existing developments including: clear rules on management company AGMs; requirements for homeowners to be provided with detailed financial accounts and budgets; a legal requirement for the establishment of a ‘sinking fund’ for all developments; the possibility for existing developments to convert relatively easily to an ‘Owners’ Management Company’.

“Property management companies are a relatively new phenomenon, but one which have caused an increasing level of frustration for new home-buyers in recent years. People contact my office on an almost daily basis with problems relating to their property management company or agent. At present, we can only point them in the direction of useful resources such as the National Consumer Agency which, for instance, yesterday published an update of its guide to management companies.”

An article by Gavan Carty in the Irish Times summarising the main points in the LRC report can be found here.

The Law Reform Commission’s Press Release on the new report can be found here.

The LRC’s full report on Multi-Unit Developments (published 24.06.08) can be found here: here.

The National Consumer Agency’s guide to management companies (published 23.06.08) can be found here.