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Managing Agents - commission on maintenance quotes
Is it common practice for managing agents to take some kind of commission on quotes for maintenance work done in the block of flats? If so, is this legal?
The trustees in my sectional title block of flats believe the managing agents are receiving a commission or kickback because the managing agents strongly encourage the trustees to accept the quotes that they obtain, and not independently seek lower quotes. In the case of a particular plumber the quote that the managing agents presented to the trustees was higher than the quote that one of the trustees independently obtained from the same plumber.
Responses would be welcome.
Elizabeth
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RE: Managing Agents - commission on maintenance quotes
Any such commission should be provided for in the mandatory contract between the Body Corporate/ Trustees and the managing agent. If it is not provided for in the contract, it would not be payable as such.
RE: RE: Managing Agents - commission on maintenance quotes
Thanks for that info. Do you know if it is common among managing agents to have that in the contract?
RE: RE: RE: Managing Agents - commission on maintenance quotes
Just a personal comment: this sort of thing is highly irregular. As a trustee, I would not sign a contract with a MA which had such a clause in it.
RE: Managing Agents - commission on maintenance quotes
Hi
Similar to the trustees the MA is in a fiduciary relationship with the BC. There are MA's who have a pool of service providers they will always use/recommend. Unfortunately what happens between the MA and this 3rd party is beyond the direct control of the BC and would be difficult to police.
In your case where the trustees are aware of the apparent "loading" of a quote to accommodate a commission/ kickback this should be queried with the MA and if he is a member of NAMA it should be reported to them (even if it is just for the record). It could also be that your MA has fallen foul of PMR 46 (2) (a). The MA should also be queried on his relationship with the various providers/contractors he uses....Show More
If the trustees have just blindly accepted quotes given to them without verification, this might now be their wake-up call.
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