A Trustee of a complex that we don’t manage contacts you saying that they want to get rid of their current Managing Agent and come over to Trafalgar.How do I give notice to my current Managing Agents?
The first thing you need to do is to ask them for a copy of the signed Management Agreement they have with the current Managing Agent.
- If they don’t have a signed Management Agreement then all they need is a Trustee resolution or an ordinary resolution to be passed by the Body Corporate. I would say giving them 30 days notice is reasonable in this case.
(5) The body corporate may, if trustees so resolve, and must if required by —
(a) a registered mortgagee of 25 per cent in number of the primary sections; or
(b) a resolution of members,
appoint a managing agent to perform specified financial, secretarial, administrative or other management services under the supervision of the trustees.
- If they do have a signed Management Agreement you need to check when it was signed. The Act states that a Management Agreement cannot run for more than 3 years at a time; so if it is within the 3 years they need to follow PMR 28(7) (special resolution and two month’s notice)
PMR 28(7) A management agreement may not endure for a period longer than three years and may be cancelled, without liability or penalty, despite any provision of the management agreement or other agreement to the contrary —
- by the body corporate on two months notice, if the cancellation is first approved by a special resolution passed at a general meeting, or
- by the managing agent on two months notice.
Note the bolded part – the Act overrules any weird contract they may have – they don’t have to give 3 months’ notice two weeks before the Monday when it is full moon and the sun is in line with Jupiter!
Just note that this is one of the instances where ito the Act the special resolution must be passed at a meeting – cannot be passed on a round robin
- If the Management Agreement is older than 3 years it has expired ito the Act and then they need to follow PMR 28(8) (Trustee resolution or Ordinary resolution)
PMR 28(8) The body corporate or trustees may by ordinary resolution cancel the management agreement in accordance with its terms or refuse to renew the management agreement when it expires
PS – this is based on the assumption that they work on the Prescribed Management Rules of the STSM Act and that they have not amended their Management Rules in this regard