Thursday, October 1, 2009

Irish Property & Facility Management Association Conference "Seeing Through the MUD"

At the kind invitation of the Irish Property and Facility Management Association (IPFMA),  I attended their conference in Croke Park this morning,  with the intriguing title of "Seeing Through the MUD".

The MUD in question is the Multi-Unit Development bill 2009,  currently before the Oireachtas.  The Law Reform Commission made recommendations on the regulation and legislation pertaining to the Property Services industry,  and in particular to the role of management operating companies for apartment complexes.   The IPFMA have been extensively engaged throughout the process,  and the main purpose of today's conference is to consider a number of issues with the current draft legislation,  with a view to making a further submission to the Departments of Justice, Equality and Law Reform;  and of the Environment.

I unfortunately could only attend the opening session in the morning,  and not the full day.

The morning opened with a presentation by Tom Lynch,  the CEO (Designate) of the new Property Services Regulatory Authority (PSRA).  The PRSA has been established to operate a licensing system for auctioneers,  letting agents,  and any services relating to the management of apartment complexes,  housing estates and so on.  It also will operate a complaints procedure,  including a compensation fund to recompense clients of the agents,  companies,  partnerships and individuals whom it regulates,  in the case of fraud.   The new legislation has quite strong sanctions against wrong doing,  but in addition the PRSA also has the ability under the legislation to itself introduce yet further procedures and regulations for the industry which then carry the full authority of law.    Licensees will require a qualification,  and the PRSA is working with the Dublin Institute of Technology to clearly set out the precise requirements.  Licensees will also require professional indemnity insurance,  although as yet the precise requirements have still yet to be clarified.   Interestingly,  all employees of all licensee holders (eg a body corporate) will also have to be individually licensed.

Patricia Rickard-Clarke,  of the Law Reform Commission,  gave an overview of the draft legislation,  and noted there remains a major issue in the drafting in defining the procedures and responsibilities for completion of multi-unit developments.

Pat McGovern,  a Chartered Building Surveyor,  amply reinforced Patricia's concerns by clearly identifying issues relating to "snag" lists during the transition from the developer to the apartment owners and their management operating company.  He noted that poor workmanship on behalf of a builder may sometimes in practice only come to notice after a year or so after occupancy.   He noted that certificates of compliance submitted during the conveyancing procedure may not always accurately reflect the actual state of a building.   The current draft MUD legislation does not at all sufficiently address completion issues.

Colm Traynor,  CEng and a Fellow of our Institution,  then gave a presentation about the fire safety compliance.    Like Pat and Patricia,  he noted serious issues with the completion procedures as drafted by the MUD legislation.  He noted that a Fire Safety Certificate only confirms that a building has been safely designed,  and not that the actual construction and completion of the building in fact is in full compliance with the design.  He noted that in a multi-unit facility,  individual property owners may undertake internal work (eg removing an internal wall to make an apartment more "open plan") which sometimes can compromise the fire safety of the building as a whole,   thus impacting the safety not just of themselves but of their neighbouring owners.  He noted that while there are onerous obligations on property owners for fire safety,  including criminal penalties,  the current legislation does not clearly identify who in fact has this obligation in a multi-unit building with private owners and with a management operating company.    As of today,  there are new categories of fire safety certificates,  and as of January next there is also a new Disability Access Certificate.   In all these cases,  the current draft MUD legislation,  while aiming to protect the consumer,  does not in fact clearly establish the requirements for compliance of certification.

The conference continues today.   I sensed that while almost all present greatly welcomed the regulation of their profession,  and the establishment of a common set of industry standards,  there clearly remained some detailed legislative drafting to "see through the mud" and articulate details.   There are also concerns about the legal responsibilities and liabilities of those who act as Directors of management operating companies,  including in cases where owners' subscription fees are used to make good unfinished snags and poor workmanship,  rather than ongoing maintenance of a shared building.

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