Mahoneys was recently featured in Resort News – the magazine for the accommodation industry professional – where Ben Seccombe discussed a significant win for the management rights and strata industry. Specifically, caretaking agreements can be extended any number of times!
In recent years, it has been suggested by some practitioners in the industry that caretaking agreements can only be extended (“topped up”) once and never for a term exceeding the maximum allowed in aggregate. While Mahoneys did not consider there to be any merit to the “one-time top-up” myth, there had not previously been an opportunity to obtain a ruling on this issue from an Adjudicator.
Atlantis West [2024] QBCCMCmr 340 finally puts any uncertainty to bed.
Mahoneys, supported by the Australian Resident Accommodation Managers Association (ARAMA) and EBM Insurance & Risk (EBM) successfully defeated a challenge to the validity of extending caretaking agreements. Critically, the Adjudicator clarified the position that caretaking agreements can be extended any number of times, provided the cumulative term does not exceed the maximum term permitted under the relevant module from the time of the extension, which is limited to no more than 5 years, is added.
You can read our summary of the decision, and what it means for the management rights and strata industry, here.
This case serves as a powerful reminder for management rights operators of the role ARAMA plays in supporting the industry and the specialist insurance provided by EBM (via the A-Legal Insurance Membership Benefits exclusive to ARAMA members).
Mahoneys is one of Australia’s leading management rights law firms, with a team of industry-leading lawyers that has supported the management rights and strata industry for over 30 years.
Feel free to contact our dedicated management rights team if you need assistance buying, selling or running a management rights business.
“UPDATE: the applicant has appealed the Adjudicators decision. Mahoneys will provide an update after the appeal has been heard and ruled on.”
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