Reliable Strata Management Agreement Lawyers Sydney, NSW

What is a strata building management agreement in NSW?

A strata building management agreement in NSW is a formal contract between an owners corporation and an appointed strata manager or building manager, outlining the specific management services to be provided for the strata scheme. This agreement details the duties, fees, and duration of the appointment, governed by NSW strata laws such as the Strata Schemes Management Act 2015 (NSW). It ensures clarity regarding the responsibilities for the building management of the common property.

Why is a strata management agreement crucial for a strata scheme?

A strata management agreement is crucial for a strata scheme because it clearly defines the responsibilities and scope of work for the appointed strata managing agent or building manager, ensuring the efficient operation and administration of the property. This legally binding document helps prevent disputes by setting clear expectations for management services and performance standards. Ultimately, a well-drafted agreement protects the interests of the owners corporation, the strata committee, and all lot owners.

How have new NSW strata laws impacted strata management agreements?

New NSW strata laws, particularly the Strata Schemes Management Act 2015 (NSW), have significantly impacted strata management agreements by introducing stricter regulations, most notably regarding the term of appointment for a strata manager. These laws limit the initial appointment term made at or after the first AGM to 12 months and subsequent terms to a maximum of three years. Additionally, the new strata laws place restrictions on developer appointments and clarify the strata committee’s power to extend an existing agreement temporarily.

What is the maximum term for a strata manager agreement under new strata laws?

Under the current NSW strata laws, the maximum term for which a strata manager can be appointed initially, following the first AGM, is limited to 12 months. After this initial term, if the owners corporation decides to reappoint the strata managing agent, any subsequent agreement term cannot exceed a maximum period of three years. These term limits ensure regular review of the strata management arrangement by the owners corporation.

Can a developer appoint the strata manager for a new strata scheme in NSW?

Yes, a developer can appoint the initial strata manager for a new strata scheme in NSW, however, this appointment automatically concludes at the end of the scheme’s first AGM, requiring the owners corporation to formally appoint a manager thereafter. Furthermore, NSW strata laws impose a significant restriction preventing a developer, or any person connected with the developer, from being appointed as the strata managing agent for that scheme until 10 years have passed after the registration of the strata plan. This ensures greater independence for the new strata scheme.

What are the consequences if a strata management agreement expires?

If a strata management agreement reaches its expiry date and is not formally renewed or extended, the owners corporation will be left without an appointed strata managing agent to perform delegated management services. Consequently, the responsibility for managing the strata scheme reverts entirely to the owners corporation and its strata committee. The owners corporation must then promptly decide at a general meeting whether to reappoint the agent, appoint a new strata manager, or undertake self-management to ensure continuity.

Can the strata committee extend a strata manager appointment?

Yes, a strata committee in NSW is permitted to extend the appointment of an existing strata manager under specific conditions defined by strata laws. The committee can extend the period of appointment for successive periods, each up to a maximum of three months. However, the total duration of these extensions cannot go beyond the date of the next scheduled AGM, allowing the owners corporation time to make a formal decision at a general meeting.

What should lot owners look for when reviewing a building management agreement?

Lot owners reviewing a building management agreement or strata management agreement should focus on ensuring there are clear definitions of the strata manager’s duties, the scope of management services provided, the associated fees, and the agreement’s duration, including the term of appointment and expiry date. It is important to verify that the terms are fair, transparent, and compliant with current NSW strata laws to protect the interests of the strata scheme. Seeking independent legal advice is advisable if any clauses are unclear or seem unreasonable.

How can PBL Law Group help with our strata building management agreement or appointing a new building manager?

PBL Law Group offers comprehensive legal assistance to owners corporations and strata committees regarding strata building management agreements, including drafting new agreements, reviewing existing ones, and negotiating favourable terms to ensure compliance with NSW strata laws. Our expert Strata Building management lawyers in Sydney provide clear legal advice throughout the process to appoint a new building manager or strata manager, ensuring your strata scheme’s interests are protected. We can also assist in resolving disputes related to the management agreement or the performance of the strata managing agent.