Responsibilities of a facilities manager in community and neighbourhood schemes

Facilities manager responsibilities

A community, precinct or neighbourhood scheme may engage a facilities manager.

Facilities managers can be referred to as building managers, caretakers or resident managers and can assist with the day-to-day running of a scheme within community lands.

The facilities manager may assist the association in:

• managing association property
• controlling the use of association property by owners, residents and visitors
• maintenance and repair of association property.

Facilities managers can also perform duties such as security, cleaning, and managing the upkeep of the gardens and grounds of the scheme.

Facilities managers have duties under the community land laws that regulate their conduct. Penalties may apply where a duty is breached.

These duties are to:

Act in the association’s best interest (unless doing so would be against the law).  

Act promptly and with due diligence to –  

• bring the association’s attention to any maintenance, repair or safety issue with the association property that the manager is aware of.  
  This includes both a problem that the facilities manager becomes aware of (e.g. a retaining wall collapsed), as well as a problem that the facilities manager ought to be aware of (e.g. a retaining wall looks like it is about to collapse).
• propose to the association how a problem should be addressed.  
  For example, recommending a structural engineer or builder assess the collapsed retaining wall.

Give written notice of benefits and connections when suggesting a contract for goods or services  

• If the facilities manager will receive a benefit in relation to a contract they suggest to the association, the written notice must include the person who will provide the benefit, and  the monetary value of the benefit or the method of calculating the value.    
• If the person the contract would be with is connected with the facilities manager, the written notice must include the nature of the relationship between the facilities manager and that person.

Disclose any relationships and financial interests  

• A facilities manager must promptly give written notice to the association if the facilities manager:  
  • is connected with a supplier of goods or services for the scheme. The notice must include what goods and/or services are provided by the supplier, and the nature of their relationship to the facilities manager.  
  • is connected with the original owner of the scheme. The notice must include the nature of the relationship between the facilities manager and the original owner.  
  • has a direct or indirect financial interest in the scheme. The notice must include the nature of the financial interest.  

Responsibilities not covered

Facilities managers may not enforce by-laws or carry out other similar functions of the association.

A person is not subject to the laws regulating the activities of a facilities manager if they perform those functions voluntarily, on a casual basis, or as an association committee member.

Service providers such as electricians, gardeners, cleaners or plumbers are not facilities managers.

Overall, a person is not a facilities manager if they:  

• are engaged solely to do one or more repair or maintenance services for the association property,
• their terms of service are limited to carrying out the repair or maintenance
• their terms of service (does not include the duties of a facilities manager, like managing or controlling association property), and  
• they are not appointed as a facilities manager under a facilities manager agreement. 

If the facilities manager also acts as an onsite residential property manager handling the letting of properties for lot owners, they must be licensed as a real estate agent under the Property and Stock Agents Act 2002 (the Act).

Appointing a facilities manager

A facilities manager can be appointed by resolution at a general meeting. This decision can be made at the association’s first annual general meeting (AGM) or at any general meeting during the life of the association.

The decision to appoint a facilities manager and the functions they should exercise if appointed will be determined at the meeting. The appointment must be in writing under a facilities management agreement. If appointed before the first AGM, the contract ends at the first AGM. Otherwise, the contract cannot exceed a period of 10 years.

Before they are appointed, a facilities manager must disclose the following:

• a potential conflict of interest – a professional or personal association with the original owner (the developer)
• a pecuniary interest – a financial interest, other than them benefiting from the prospective appointment itself
• advice given to the developer – whether they have given advice about strata plans or a community land plan to the building developer in the last 2 years.
• if they may receive a benefit that affects the fees that they will charge in the facilities manager agreement.  
• A benefit includes a referral fee, commission or a direct or indirect benefit.  
• For example, this would include telling the association that they expect to receive a referral fee from the cleaning company they will nominate after they are appointed as facilities manager.   

Reappointing a facilities manager

If a facilities manager has already been appointed by the developer, the existing contract will end on completion of the contract.

On completion of that contract, the association can choose to reappoint the existing facilities manager or choose a new one.

How terminate an agreement

An association can terminate the facilities manager in accordance with the facilities management agreement and if authorised by a resolution of the association passed at a general meeting.

An association can apply to the Tribunal to change or end a facilities manager agreement on certain grounds. This includes where the facilities manager acts unlawfully in their role. For example, breaching a duty under the community land laws.   

Resolving facilities manager disputes

An association may, at any time during the agreement, make a resolution at a general meeting to terminate, in line with the terms of the agreement, or apply to the NSW Civil and Administrative Tribunal (Tribunal) for an order to:

• terminate the agreement
• require compensation to be paid
• vary the term or conditions, or declare a term of appointment void
• require a particular action to be taken, or not taken, by a party to the agreement.

Apart from terminating a contract, the association can also resolve to transfer a facilities management agreement to another person.

Disputes relating to facilities management agreements may be resolved by formal mediation.

Facilities manager proxy voting

Facilities managers can be appointed as a proxy in the same way as other proxies. For more information, visit the meeting and voting page.

A facilities manager cannot use a proxy vote:

• to obtain a financial or material benefit
• in a decision about legal proceedings involving the proxy.