Owners in a Sectional Title scheme are members of a community that has prescribed management structures, including the body corporate, the trustees and often, a managing agent.
However, while most people know that the body corporate is made up of all the owners in the scheme and that the trustees are responsible for executing the statutory functions and decisions of the body corporate, there is a lot less certainty about the role of the managing agent, says Andrew Schaefer, MD of national property management company Trafalgar.
“To start with, though, it is important to understand that the managing agent does not take over the responsibilities of the body corporate or trustees or make decisions for them with regard to the financial management, administration, governance, payroll and statutory reporting obligations of their ST schemes. Our role is only to provide expert assistance and guidance and to help implement the instructions of the Trustees.
“It is necessitated by the fact that most owners and trustees are not property professionals, and need qualified support to ensure good governance and effective communication in their schemes. The importance of this becomes evident when one considers the value of the property assets involved and the lifestyle and financial implications for residents when a scheme is not well-managed.”
Managing agents are generally appointed, he says, by majority vote at the AGM of a ST scheme, and the full scope of their function should thereafter be set out in a management agreement that is signed by the trustees and functions as a service level agreement.