In many sectional title schemes, the difficulties encountered by bodies corporate and/or a lack of administrative experience can result in their becoming negligent, says Michael Bauer, the general manager of the property management company IHFM.
“The position of trustee can be a tough one in that they are working for no pay but often have to put in many hours,” says Bauer, “and it can cause some trustees to become disillusioned and non-caring. Inevitably they become lax about their responsibilities and fail to detect irregularities and the scheme may then go downhill.”
Bauer says that if body corporate members find this happening they must make use of the Prescribed Management Rule 53 which allows them to call on the trustees to organise a special general meeting – provided that they (the members) can show that 25% of the scheme’s members are in favour of such a meeting.
If, after 14 days, the trustees have not complied with this request, the Prescribed Management Rules allow any owners in the scheme to call such a meeting himself – at which it is possible to bring about the instant dismissal of some or all the trustees and the election of new trustees. The notice that is sent out calling this meeting must state the purpose is to remove a trustee, he or she may not be ambushed in cases such as these, says Bauer.
“As long as there is a quorum at the meeting and the majority of the attendees agree to the removal of the trustee will go ahead,” he says.
“Unfortunately, we quite often come across schemes where the trustees are no longer competent and must relinquish their position. In this situation, it is not unusual to find that one or two, who may have been on the board a long time, do not admit to their failures and fight desperately to hold their positions.
Members of bodies corporate must take an interest in their schemes and point out to the managing agent or a trustee any matters requiring attention. They must also attend the scheme’s meetings.
“Very good and very bad schemes,” said Bauer, “tend to have one thing in common: the members do not see any need to be involved. On a badly managed scheme, this can be disastrous. If firm action is required, including the dismissal of the trustees, this must be done for the sake of all the members.”
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