Trustees are selected by the owners of a body corporate at an annual general meeting.
They are usually chosen because they volunteered when nobody else would.
Being a managing agent is a highly skilled job with a skill level similar to an accountant and attorney.
Unfortunately, trustees are often chosen by people who have little understanding of how a body corporate is run.
Some of those who choose them have little or no financial skill or understanding and others have no legal background.
As a result, many trustees are totally unsuitable for the task that they have taken on.
Many trustees simply don’t have the experience or skills required to manage a body corporate or a company.
Having a background in owning or at least managing a business is a great asset when working as a trustee.
You will have some idea of budgeting, debt collection, leasing, transfers, credit control, maintenance, legal and so much more that goes into running a body corporate.
Very few trustees have these skills.
Unfortunately, many trustees believe that it is their job to control the managing agents.
While it is their responsibility to oversee the managing agents to ensure that they do what’s expected of them, it is not their responsibility to instruct the managing agents on what to do.
The very reason that you employ a managing agent is that they have the legal and technical skills and knowledge to run your scheme.
If the trustees’ attitude is that they are in charge of the running of a building or complex, then you should not be employing a managing agent.
But that is a road to disaster.
Good trustees understand what their job entails, that of ensuring that what needs to be done is done.
It is not to do the work of or instructing managing agents on what they should be doing, but to receive reports on the current financial and management of the building or complex and query anything that does not seem right.
Good trustees work in close harmony with good managing agents.
They are a real asset to the smooth running of their scheme.
On the other hand, trustees that insist on running the scheme “their way” seldom have a realistic grasp on what their job is.
They are not chosen to captain the ship but rather to be the pilot that advises the master on the safest and surest passage for the ship.
Dictatorial trustees seldom get the best out of their managing agents and frequently result in managing agents just doing what they are told when they are told – which does nothing for the smooth running of a scheme.
This type of trustee often ends up trying to dictate to owners as well as the managing agents and demotivate all that are concerned.
Owners must think about the people that they nominate and vote as trustees.
Just because a person has the loudest voice and talks the most does not necessarily make them the best trustee.
Trustees should be chosen for their good character and business-like skills and knowledge.
- Mike Spencer is the founder and owner of Platinum Global. He is also a professional associated property valuer and consultant with work across the country as well as Eastern Europe and Australia.