by Robert Van Aalst of Lawyers Central
Part 3 of 3
MY STINT AT ISTM SUPPLIERS CHAPTER
In the 2000s, I was invited to be a member of the supplier chapter of the ISTM and served for about a year or so. I thought by being on the committee I could encourage and assist the strata industry to become a profession. I was wrong.
I underestimated the self-interest, power, and influence of the suppliers and old-time strata managers whose focus was not education.
At my first Chapter meeting, I asked, “why isn’t membership restricted to strata managers?” To support my argument, I used the Law Society as an example which only allows lawyers to be members.
I also queried the relatively low educational entry qualifications to become a strata manager and suggested that there should be proper professional qualifications.
Thinking that the resistance was based on possible loss of business opportunity, I suggested if the ISTM membership was restricted to strata mangers, suppliers would not lose any business opportunities. They could still advertise in the ISTM monthly magazine and be benefactors to the peak body but avoid the potential for conflicts of interests by being members.
I also contended tertiary education for strata managers would continue to guarantee financial benefits to the suppliers.
I attended some ISTM/SCA Conferences which usually coincided with the AGM and appointment of board members followed by separate celebratory award dinners. These were and remain glitzy affairs, full of self-congratulations, self-promotion, loads of grog and other goings-on.
In the old days, presenters included motivational speakers, special guests that had no connection to strata. They were an opportunity to mingle, mix, let one’s hair down, exchange business cards, and network. Supplier members had stands and giveaways. But strata managers over all were the minority of attendees which also included suppliers paying for strata managers to attend to boost numbers. This has changed to where is just about equal representation.
The suppliers also promoted and sponsored golf and sailing days.
Lawyers started conducting information sessions.
But education if it gained any mention was cursory at best. I gave up attending.
In relatively recent times I noticed some strata firms, particularly larger companies are entering areas previously covered by suppliers such as insurance broking, fire services, building and handyman services. This could potentially be a hot bed for conflict of interests.
BIG PLAYERS
There have always been big players in the strata industry but now there are more. Over the past 10 years, big companies have been buying small firms and merging into mega firms. I am concerned this stymies competition and as we have now seen from Netstrata encourage questionable practices. I also fear these mega firms exercise too much influence in the peak body due to the constitution which provides each individual member of the strata management company voting rights which guarantees either their appointment to the board or those they support. The few are monopolizing the future of strata and I don’t see any efforts to encourage proper tertiary education.
BACK TO EDUCATION
Below is a list of some of the legislation strata managers need to know, understand, and apply from day to day including other professional responsibilities: –
- Anti-Discrimination Act
- Agricultural Tenancies Act
- Dividing Fences Act
- Strata Schemes Management Act and Regulations, including amendments
- Strata Schemes Development Act and Regulations, including amendments
- Strata Schemes (Freehold Development) Act and Regulations
- Strata Schemes (Legislation Development) Act and Regulations
- Managing and preparing financial accounts and preparation of budgets
- Community Land Management Act and Regulations
- Community Land Development Act and Regulations
- Property Stock and Agents Act and Regulations
- Work Health and Safety Act and Regulations
- Interpretations Act – service by post
- Privacy and Personal Information Act
- Privacy Act and Amendments
- Environmental Planning and Assessment Act and Regulations particularly concerning Fire Safety
- Uncollected Goods Act (NSW)1955
- Residential Apartment Buildings (Compliance and Enforcement Powers) Act and Regulations
- Residential Tenancies Act and Regulations
- Design and Building Practitioners Act
- Civil and Administration Tribunal Act and regulations (NCAT)
- Home Building Act and Regulations
- Preparation of budgets
- Tax law relevant Strata Title and Company Title
- Statutory Forecasts
- Consultation with service providers
- Insurance legislation and requirements
- Accounting Practices Procedures including Trust Accounting
- Risk management and risk compliance including managing strategic risk, compliance risk, operational risk, financial, financial risk and conduct risk
- Mediation
- Communication including written communications
- Ethics and conflict of interests
- Psychology
- Dealing with other professionals and contractors associated with strata
- The law of meetings
This massive load supports my contention why tertiary education should be mandatory to qualify as a strata manager and is long overdue.
WHAT IS THE” SHAKE UP” THAT IS NEEDED?
Strata managers practice has become complex, and the time has come to be proactive and make long term solutions such as providing a degree course.
There should be an examination why this obvious solution has been ignored.
Membership of the peak body should be restricted to strata managers and not include service providers.
The current model of the peak body admitting mixed membership lends itself open to abuse.
Strata has outgrown the current industry model.
Maintaining a collective industry of strata managers and services providers is unhealthy and I suggest encourages conflicts of interests.
LEGAL PROFESSION AS COMPARISON
Improvements in the legal profession were mainly a result of clients/consumers expressing their concerns and dissatisfaction. It also became a political imperative to introduce legislative change. In my time as a practising lawyer, there have been many legislative changes governing legal practice including the establishment of a Legal Services Commissioner. The legal profession has benefited from these changes resulting in more accountability for services provided including costs and less client/consumer dissatisfaction.
Strata like the legal profession had and has its share of bad players but the legal profession is an example where changes resulted in better practice of law, a weeding out of bad players as well as more public accountability which increased confidence. The same will apply to strata management if the time is taken to make the hard decisions and make proper and necessary changes as outlined in this paper.
Expect resistance from some self-interested industry players but if real improvements are not made, expect more damaging media exposes.
The future can be an exciting time for the strata management profession.
As I said at the beginning of this paper strata continues to grow and if it becomes a profession and has oversight, it will attract better players and gain the respect including the rewards and recognition it deserves.
Read Part 1 HERE & Part 2 HERE