Help, my body corporate manager (BCM) is a problem
Sometimes, the expectations of owners are not aligned with those of the body corporate manager. Here are some ideas to consider when evaluating body corporate manager behaviour.
Check your contract
It is very important that you read and fully understand the body corporate manager contract. Look carefully at the inclusions and exclusions of the contract. Pay particular attention to any charges that are not fixed such as disbursements and charges for additional services (such as attending committee meetings). There must be a contract – you can always request a copy from the committee or the body corporate manager directly.
Comparing body corporate managers
Price is not the only metric that should be used when comparing body corporate managers. However, it does often play a large part in the decision of a body corporate. Make sure that when you compare quotations from body corporate managers you calculate the total cost based on the same set of activities. Not all activities will be covered by a fixed charge and not all body corporate managers will include the same set of activities under the fixed charge.
Our approach is described in this case study.
A body corporate manager is usually not a property manager
A common misconception is that the body corporate manager is undertaking property maintenance tasks. This is usually not the case and is generally explicitly disclaimed in most contracts. Most functions of the body corporate manager are related to administrative services. For example, on instruction from the committee or body corporate, a body corporate manager will seek quotations for a specific property maintenance task (eg. mowing) and then await instruction from the committee on the choice of contractor. It is very likely that the body corporate manager will charge additional fees for the task of seeking quotations.
A body corporate manager may be an agent of one or more insurers. The BCM may receive an insurance commission from the insurer of the body corporate property. The commission compensates the body corporate manager for the tasks undertaken on behalf of the insurer such as completing claim forms for the body corporate. Commissions are usually declared by the body corporate manager to the body corporate. Be aware that different insurers have different commission structures.
The committee remains responsible
Most body corporate manager contracts do NOT relieve the body corporate or the committee of their statutory functions. When thinking about the behaviour of a body corporate manager make sure that all statutory obligations are being met. Read the relevant Act.