What is a Nominee

Date Added: 14/06/2012 by Frank Higginson - Hynes Legal

We are quite often asked about the rights of resident managers to appoint others to act to represent them in their dealings with a body corporate.

The person appointed can be called on any number of things. Some of the more common ones are:

caretaker’s nominee;
caretaker’s representative;
the appointee;
the nominated representative. 

There are other names as well

There are no hard and fast rules under the BCCM Act when it comes to the appointment of nominees to represent your business, so in almost all cases, the requirements around nominating someone to be a representative of the resident manager reside in the caretaking agreement or the letting agreement alone.

There are various types of clauses that deal with these situations. But the most common one is along the lines of:

‘If the caretaker is a company, it must appoint a representative to liaise with the body corporate. Where that representative is not a director or shareholder of the caretaker, the representative must be approved by the body corporate committee.’

So what the representative is called under the agreement varies from building to building, but what it actually means is effectively the same thing. It is the person who will be appointed to liaise with the body corporate on a daily basis on behalf on the resident manager.

If you want to appoint someone to represent the resident manager company to deal with the body corporate then you need to make sure that it is done in accordance with the terms of the agreements themselves.

Where we see this most commonly is where the owner of the management rights business might not actually operate it themselves and instead appoint staff or contractors to do that. 

Under the terms of most management rights agreements, the representative will have the ability to bind the resident management company to whatever it agrees to. So therefore, if you do have a employee or contractor in charge of your management rights business, it is very important to understand the ground rules about what they can and cannot agree to on your behalf. This should usually be governed by the contract under which the employees / contractors are engaged.

  Visit www.hyneslegal.com.au for more information

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