The compliance challenge

11 February 2019

In this modern world of extreme regulatory control it should perhaps come as no surprise to most readers that there are many aspects of operating a management rights business which in order to achieve regulatory compliance require a multitude of certificates, reports and records.

Whilst little attention may have been placed on such compliance in the past we are today seeing more and more bodies corporate insisting on resident managers meeting all of the relevant regulations.

It is hard to argue that insistence on regulatory compliance is a bad thing although sometimes the motives of a body corporate are questionable particularly when no interest has ever previously been shown in such things but out of the blue, when there is an element of concern (however justified that might be) about a manager’s performance, there is suddenly a demand for absolute compliance and criticism levelled at the unsuspecting manager for any noncompliance however minor.

We have unfortunately seen hostile committees, armed with an audit report of the manager’s lack of compliance, seek to breach a manager for failing to meet in all respects the extensive regulatory regime.The committee can of course justify its actions by pointing to the manager’s failures as highlighted in the report and claiming it is only taking such action in the interests of the scheme and the owners.

So what is the best way for a manager to avoid being found in such a position? The simple answer of course is to ensure you are compliant so as to not give the committee the opportunity to breach you. However that may not be as easy as it sounds due to the extent and complexity of what you need to do. Whilst most managers have a general or even specific awareness of many of the documents they need to have and maintain, in our experience few if any managers are fully aware of all of the requirements.

Where to look then? A good starting point is the ABMA Code although many managers may struggle with the technical nature of parts of the Code and would be better off to seek some practical training from one the various experts or training organisations within the industry.

Mahoneys have also developed a list of the various certificates and records which a manager should maintain and have in recent times been making these available to our clients. An example of these include the display of a certificate of classification for the complex, fire hydrant test records, electrical thermographic survey results, backflow prevention certificate, daily pool water testing records, annual termite treatment certificate, WHS plan, contractor sign-in register and hazardous materials management system.

These are only a selection from the full list and even by themselves they may appear daunting. However with help from an appropriate expert it will not take a manager long to gain a better understanding of the requirements nor to put together what is needed to ensure compliance.

I strongly encourage all managers to turn your mind to this issue. You never know when one or more disgruntled committee members might have a compliance audit undertaken and or take you to task over a missing record or certificate. Such a scenario can be easily avoided by seeking appropriate help and putting in the effort to ensure compliance. Once you have everything in place it is pretty easy to keep it that way and avoid a hostile committee taking you to task.

I should also mention that whilst some of the requirements may appear overly prescriptive or bureaucratic, they have been designed to ensure the safety of your owners, occupants and contractors such as you working at the complex as well as to ensure the complex is well managed and maintained. Apart from avoiding trouble for noncompliance, a proactive approach may well avoid personal or property damage, will impress your committee and limit your exposure to liability in the event of a range of accidents or failures.