Guidelines to setup Management Corporation
All condominium property owners should be conversant with the guidelines on setting up Management corporations.
You may already be aware that the management corporation of a Condominium Property is legally established with the registration of the Condominium Property Plan and the declaration at the land registry . Simultaneously the permanent occupants of the units of the condominium property too become legal owners of the respective units .
The first Annual General Meeting of the Management corporation and the appointment of the council should take place within 03 months from the registration of the condominium property .In terms of the Act it is considered as an “ Association “ . Occupants of all Condominium property units are required to participate at the Annual General Meeting of the Management Corporation .
The Secretary and the treasurer of the council are appointed from among the members of the council appointed at the Annual General Meeting .The Annual General Meeting is the most significant event of the Management corporation .Its office bearers should be elected each year at the Annual General Meeting .The decisions pertaining to proposals for repair of buildings , extensions to buildings , maintenance fees payable by the occupants of each unit etc for the ensuing year are taken at the Annual General Meeting. Furthermore ,decisions on hiring of common elements are also taken at the AGM . In case a tenant who is not a owner of a unit wishes to participate at the AGM . a letter of concent or proxy from the owner should be submitted . A person with such authority is entitled to vote . The quorum of the meeting shall be half the membership entitled to vote at the AGM.
The council of the Management Corporation is elected at the AGM which is participated by the entire ownership of the units . The duration of the period of office of the council is 1 year ,until such time the next AGM is held .i.e 12 months .
The Council shall consist of not less than 3 and more 14 owners of units . In case of instances where the number of owners of units in a condominium property is not more than 3, the council shall comprise of owners of all units .
In case of councils other than those compricing all owners , a member of a council shall be removed from his/her post by a resolution passed at a special meeting, and replaced by another member appointed for the remaining period until the next AGM is held .A member of the council may resign from his/her post by trending a written letter of resignation addressed to the management corporation . Furthermore if a vacancy occurs in the council the members of the council shall be convend as deemed appropriate at a fixed time and venue .
The quorum of the council shall depend on the number of office bears as follows
· 2 persons for councils compricing not more than 4 members .
· 3 persons for councils comprising 6-7 members .
· 4 persons for councils comprising 7-8 members .
· 5 persons for councils compricing 9-10 members.
· 6 persons for councils comprising 11-12 members .
· 7 persons for councils comprising 13-14 members ,
The problems which arise at council meetings shall be solved by majority vote . The council shall be chaired by a member elected by the members of the council present at the meeting. The chairman shall have a casting vote addition to the normally entitled vote .The procedure for the smooth functioning of the council shall be adopted by the council itself . certain powers entrusted to the council may be rested on a particular member or a group of members of the council .The vesting of such powers shall be done in accordance with the conditions laid down by the Management corporation at AGM.
The council shall have powers to co-opt members and appoint employees required to execute .The functions of the Management Corporation .(eg.apointment of auditors ) . The council shall maintain records of all activities performed and the minutes of the Annual General Meeting . It is also responsible for maintaining accounts of receipts and expenditure along with the details of transactions and for book-keeping .It is obligatory on the part of the council to ensure theat the accounts are submitted for security by a particular owners of a unit of condominium property or someone authorized by him in response to a request made in writing . The council is also responsible for submitting the AGM. The Annual Report is subjected to audit by auditors appointed by the council . It is also the responsibility of the council to submit the audited Annual Accounts, resolutions if any passed at the AGM and a copy of the approved minutes of the AGM to the Condominium Management Authority, within 30 days from the date of the AGM. The council is also responsible to submit to the Authority . The extracts of accounts of the management corporation or any other report when requested by the authority . The members of the management corporations are also liable to submit on request any information in his/her possession .It is also maditory for the council to convene the regular AGM to examine the Accounts , to appoint a new council and to attend to other relevant matters of the Management Corporation . The first AGM of a condominium property shall be held with in 6 months from the date of registration of Condominium plan , while an AGM should be held regularly each year thereafter .
It is also mandatory to hold the AGM prior to lapse of 15 months from the date of the previous AGM . In addition to the AGM , special general meetings may also be convened on an appeal made by 25% of this owners of units in the condominium property .Extraordinary meeting may also held if deemed necessary by the council . The Management Corporation may also convene special meetings on instructions of the authority . Whenever such special meetings are convened all owners of this units of condominium property should be notified 7 days in advance . The quorum of such meetings shall be half the member of owners of units eligible for voting at the meeting . In other words 50% of the ownership of units . In case the required quorum is not available after the lapse of ½ hour from the time fixed to commence the meeting, it shall be held at the same tome and venue on the following day . If the quorum is not available at such a differed meeting after the lapse of ½ hour from the fixed time for commencement , the member of owners present at the meeting at that time shall be considered as the quorum special general meeting shall be chaired by a member elected by those who are eligible for voting at a meeting .