The following is intended to be brief guidance and answers to questions often asked by residents of homes in managed estates.
Please be aware that this information is general in nature. The material provided is no substitute for legal advice suitable to particular circumstances.
Managed estates, known as a multi-unit developments (referred to below as MUDs), are estates where the common areas and shared services are controlled and run by owners’ management companies (referred to as “OMCs”).
Common areas usually include all of the shared area of the estate not owed by the apartment or house owner. In other words, the OMC manages the gardens, car parks, corridors, lifts, stairways, and so on.
If you own a home in a managed estate, you are more than likely automatically a member of the OMC. If you rent, your landlord is an OMC member. It is important to remember that, together, all of the OMC members are collectively responsible for the upkeep of the estate.
Some members may volunteer to join the board of directors (a committee). They then deal with the detail of running the OMC. They hire a property management agent to carry out their instructions.
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- First of all, get in touch with the property management agent for the estate.
- The agent’s contact details should be available from sources including -
- A notice in your apartment lobby/hallway
- Newsletters or other notices sent to your home
- Correspondence about your annual management charge (if you’re an owner)
- Your landlord (if you’re renting your home)
If you are not satisfied with the responses from the agent, you should contact the OMC directors.
- The OMC is a company. In the vast majority of cases it is not-for-profit, and is a company limited by guarantee. So, for example, if the name of your estate is “New Hill”, the name of the OMC might be New Hill Owners’ Management Company Limited by Guarantee, or similar.
- The OMC is established for the management of the estate. It is owned and controlled by all the owners of the homes within the development. The owners are members of the OMC; in a way they are similar to shareholders in a commercial trading company.
- A property management agent may be a person or company. The agent is engaged or hired by the OMC to provide services in the management of the estate. The agent acts under the instructions of the board of directors of the OMC, and is directly answerable to the them for the standard of services. The details of this relationship are written down in a contract, or letter of engagement, between the OMC and the agent.
- The agent arranges the maintenance and service delivery on behalf of the OMC. An agent is often involved in the management of a number of different estates. In this way it may work for a number of different OMCs. Agents are required to hold a license. They are regulated by the Property Services Regulatory Authority.
- This Act, often referred to as the “MUD Act”, relates to the ownership and management of the common areas of MUDs. It became law during 2011, with the intention to facilitate the fair, efficient, and effective management of OMCs.
- The Society of Charted Surveyors Ireland has a useful guide to the MUD Act- click .
- The Citizens’ Information service has drawn up guidance- click .
- The Competition and Consumer Protection Commission has also prepared a number of guides- click .
Your OMC is required to issue an annual budget and an annual report. These documents should explain matters including the running of the estate, how the management fee is calculated, and where your money is spent.
There are several reasons why you as an owner should ensure to pay your management fee-
- You agreed to do so by signing the lease when you bought your home.
- Under Section 18 of the Multi-Unit Developments Act 2011 you have a legal obligation to pay.
- The OMC needs the money to provide services (such as waste collection, block insurance, repairs and maintenance) to you, your neighbours, and your properties.
- If you fail to pay, in effect you are expecting your neighbours to make up the difference.
- If you fail to pay, you are causing diminished services levels within the estate.
- The home owners in managed estates are leaseholders from the OMC. A long lease, typically of 999 years in duration, is issued by the OMC to owners when they buy their homes.
- You should have a copy of the lease from the time of your purchase. Your solicitor may have a copy. The OMC can provide a copy.
- The lease sets out the rights and obligations in relation to your property. These are called “lease covenants”. Pages 29-30 of the PSRA “” have additional detailed information.
- The House Rules of the estate is a further set of regulations, issued in line with the terms of the lease. Essentially, these are policies for day-to-day conduct in the estate. They are drawn up by the owners collectively, and approved at an Annual General Meeting (AGM). They are designed with the objective of enhancing the quiet and peaceable occupation of homes generally in the estate.
- Most House Rules are common sense- keep corridors and stairwells clear of obstructions, barbeques prohibited on balconies, no noise from homes after a certain time, etc. However, common sense is not always that common.
- The rules may be amended for changes in circumstances, by agreement at an AGM. A copy of the rules should be provided to every owner, and tenant in the estate.
- For a sample set of House Rules click here
- The OMC, as a company, has a constitution. Before recent Company Law changes, in 2014, the constitution of a company was known as the Memorandum of Association and Articles of Association, or more simply, “the Memo and Arts”.
- The functioning of the OMC, e.g. appointments of directors, members’ voting rights, holding of company meetings, is determined by the rules set out in the constitution.
- While the contents of individual OMC constitutions may differ, they must conform with Company Law. In Ireland, the is the main source of Company Law.
- Your OMC constitution is a public document. A copy is available from-
- The Company Secretary
- Online from the Companies Registration Office by using their and “View the list of Submissions” functions. A pdf of the document will cost about €3.
The and the issue useful guides on various aspects of Company Law.
A well-functioning board of directors is essential to the smooth running of an estate owners’ management company. However, finding, engaging and retaining directors can be challenging.
How can existing board members recruit and retain new directors to the OMC board? The following tips may prove helpful.
“If you don’t ask, you don’t get” goes the old saying. Approach residents in your community, particularly those who may have shown an interest in local events, or who have made a contribution to other volunteer organisations.
Provide guidance and comfort
The Companies Registration Office and the Office of the Director of Corporate Enforcement have useful guides about directors’ duties. Be clear about the number of board meetings anticipated during the year. Explain that a directors’ and officers’ insurance policy is in place; no board should operate without this cover.
Respect volunteers’ time
Board meetings should start and finish on time. Unless there are exceptional reasons, for example an upcoming Annual General Meeting for which to prepare, or particularly difficult or non-routine matters to discuss, a board meeting should not take more than an hour or 90 minutes.
New directors should not be overloaded with information or commitments. Roles, e.g. board sub-committee positions, should be kept manageable, and within the expectations of time commitments.
Elect and respect the chairperson
The chairperson of the board of directors is primus inter pares, or first among equals. He or she is elected by the other directors. The effectiveness of board meetings depends on the chairperson’s role. A fair, open-minded, and encouraging approach to divergent views is essential. This should be balanced with the objective of running meetings efficiently.
Board papers (agenda, minutes of last meeting, documents for consideration and decision) should be circulated in a timely fashion in advance, ideally at least 48 hours before the meeting.
Meet in the morning
Where the wider board agrees, consider holding your board meetings in the morning. Attendees will be fresh. Directors with business hour commitments will be motivated to effective and efficient decision-making.
Board meetings should be conducted in an inclusive manner, and all voices should be heard. Decisions of the board are decisions of the body of directors as a whole. While directors may disagree with and vote against a particular proposal, once a decision is made board members are bound to support the position. Of course, where there are irreconcilable differences it is open to dissenting directors to resign, or to take their views to the wider OMC membership via an Extraordinary General Meeting.
Remember that your fellow board members are volunteers. Flexibility, and an openness to change are key to encouraging participation. Bear in mind that your fellow directors may also be your neighbours, and good relations outside the board are important in the long run.
Even with the best will in the world, volunteer fatigue can arise. Directors can reach a point where they consider that they have “done their bit” after a number of years. It is important therefore to consider new potential recruits. Former directors, with a renewed appetite for the role, may make the best prospects.
- The regulation of agents undertaken by the Property Services Regulatory Authority includes a consumer protection function. Where your agent is unlicensed this protection may not be available to your OMC if something goes wrong, e.g. agent misconduct that costs the OMC money.
- The PSRA guide has more information about licensing and consumer protection- click here.