Multi-Unit Developments - Signposts for Practitioners & - - PowerPoint PPT Presentation

Multi-Unit Developments - Signposts for Practitioners & Stakeholders

1 July 2020

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The Housing Agency 2

Timetable

12.00 p.m. Poll 1 / Introductions & Sector News 12.15 p.m. Poll 2 12.20 p.m. Corporate Governance Presentation 12.40 p.m. Q&A 12.55 p.m. Wrap up and close MUD@housingagency.ie for copy slides

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The Housing Agency 3

Housekeeping

• Q&A function
• Chat - for problems
• Recorded for future use

MUD@housingagency.ie for copy slides

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The Housing Agency 4

The Housing Agency – Mount Street Upper

“To promote the building of sustainable communities” Working with:

• Department HLG&H
• Local Authorities
• Approved Housing Bodies
• Stakeholders

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The Housing Agency 5

Guests

Conor Sweeney John Burns

John Burns, Business Development Manager

Email – jburns@icsa.org.uk Website – icsa.org.uk/ireland

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The Housing Agency 7

Moderator / Presenter

David Rouse

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The Housing Agency 8

COVID-19

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The Housing Agency 9

Why are OMCs important?

• Census 2016: 205,000 apartments/500,000 people
• Stock +85% 2002 - 2016
• 35.2% of stock in Dublin City area
• Local Authority stock
• Number of OMCs? 6,000 – 8,000?
• Not just apartments - managed estates too

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The Housing Agency 10

Apartment Planning Permissions

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The Housing Agency 11

In This Together

Owners/Members Big Estate Owners’ Management Company Limited by Guarantee Directors (Owners) Property Management Agent Elect Instruct Hires Run Comprise PSRA Licences/Regulates Owner-occupiers Landlords = Institutional / Private AHBs / Local Authorities

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The Housing Agency 12

OMC, more than a company?

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The Housing Agency 13

Law

• Areas of law:
• Company Law
• Land Law
• Other
• Legislation
• Companies Act 2014
• Multi-Unit Developments Act 2011
• Property Services (Regulation) Act 2011

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The Housing Agency 14

Property Services Providers

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The Housing Agency 15

“OMCs- Sustainable apartment living for Ireland”

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The Housing Agency 16

UK experience

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The Housing Agency 17

Apartment Planning Guidelines

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The Housing Agency 18

New Apartments & MUDs

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The Housing Agency 19

New Schemes

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The Housing Agency 20

The Housing Agency – resources

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The Housing Agency 21

COVID-19 Guidance for OMCs

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The Housing Agency 22

COVID-19 – OMC Information

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The Housing Agency 23

Governance + Compliance

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The Housing Agency 24

COVID-19 Webinars

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The Housing Agency 25

COVID-19 Webinars

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The Housing Agency 26

Programme for Government

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The Housing Agency 27

Contact

MUD@housingagency.ie

Owners' Management Companies: Corporate Governance for Company Secretaries and Stakeholders

Presenter: Conor Sweeney Date: 1st July 2020

CLS provides expert Company Law, Company Secretarial and Company Formation services to our clients around Ireland and internationally

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Presentation Outline

• Company Constitutions for an OMC
• Annual Company Secretarial Compliance
• General meetings / resolutions and voting
• Common Changes in an OMC
• Directors' duties
• Interaction of Companies Act 2014 with MUD Act

2011

• Roles of CRO and ODCE

Owners' Management Companies

• Companies Act 2014
• Company Limited by Guarantee without a Share

Capital

• Sections 1172 - 1226
• Multi-Unit Developments Act 2011
• Law specifically for the operation and governance
• f residential and mixed use multi-unit

developments

COVID -19 Challenges for OMC’s

• Holding director and member meetings
• Approve annual report & financial statements
• Re-elect directors
• Approve the annual service charge
• Filing annual returns and financial statements

with CRO – deadline extended to 31 October 2020

• Company constitution is fit for purpose

Multi-Unit Developments Act 2011

• Requirement to establish an OMC for all MUD’s at

the expense of the developer

• Provisions for the sale of units and obligation for

developers to transfer ownership of common areas to OMC’s – Prior to the sale of the first unit

• Regulations for Mixed Use Multi-Unit

Developments – fair and equitable basis

• Automatic membership of the OMC for every unit
• wner
• 1 vote is attached to each residential unit

Multi-Unit Developments Act 2011

• Requirement to hold annual meetings and prepare

annual reports for members

• Establishment of a scheme of annual service

charges & expenditure categories

• Establishment of a sinking fund
• Making house rules
• Dispute resolution & rehabilitation of multi-unit

developments

• Restoration of struck off OMC’s to Register of

Companies within 6 years of strike off

MUD Act Definitions

• Childcare facility, commercial unit, common areas,

developer, mixed use multi-unit development,

• “residential unit” means a unit in a MUD which is

designed for use and occupation as a house, apartment, flat or other dwelling, has self contained facilities or designed and used as a childcare facility

• “unit owner” means a person other than the OMC

who holds the highest freehold or leasehold estate or interest in respect of a unit in the Development.

MUD Act Definitions

• “multi-unit development” means a development

being land on which there stands erected a building or buildings comprising a unit or units and that— (a) as respects such units it is intended that amenities, facilities and services are to be shared, and (b) subject to section 2(1), the development contains not less than 5 residential units;

MUD Act Definitions

• Mixed use multi-unit development
• The MUD Act shall apply to residential units and

commercial units in the development to the extent that amenities, facilities and services are shared by such commercial units and residential units.

• The provisions in the Act regarding annual reports

and meetings, annual service charges and contributions to the sinking fund and voting rights are applied in a fair and equitable manner.

Owners’ Management Company

• “owners’ management company” (“OMC”)

means, a company established for the purposes

• f becoming the owner of the common areas
• f a multi-unit development and the

management, maintenance and repair of such areas and which is a company registered under the Companies Acts

OMC Constitution - Memorandum

• f Association
• Company Name
• Owners’ Management Company
• Company Limited by Guarantee or CLG
• Objects Clause
• Specifically for operating as an OMC
• Include the name and address of the development

OMC Constitution - Memorandum

• f Association
• Additional objects and powers to operate as an

OMC

• Appointment of management agents
• Processing of personal data of unit owners and tenants

and disclosing the payment or non-payment of service charges and sinking fund contributions

• Powers to process personal data of unit owners

and tenants

• Liability of the members – typically €1

OMC Constitution - Articles of Association

• Automatic Membership – Sec 8 (MUD Act)
• Confined to the subscribers and the unit owners
• Where ownership of a residential unit in a MUD has

been transferred, membership of the OMC is transferred without the need to execute a transfer

• r have it approved by the Directors of the OMC.

OMC Constitution - Articles of Association

• Membership – cont’d
• Membership certificate to be issued as soon as

practicable and that the register of members is updated

• A unit owner is required to provide certain

information to the OMC and to notify them of any changes in these particulars

Articles of Association - Voting

• Sec 14 (MUD Act) - one vote shall attach to

each residential unit in a MUD to which the OMC relates, and that no other person has voting rights in respect of such determination

• Conflict:
• Companies Act 2014 – one member one vote
• MUD Act - one unit one vote

Articles of Association - Voting

• No member shall be entitled to exercise a vote

in respect of a Unit at any general meeting (or by signing a resolution in writing) unless all moneys payable to the Company including any service charge or sinking fund contributions in respect of that Unit have been paid in full

Articles of Association - Annual Service Charge

• Sec 18 (MUD Act) - An OMC shall establish, as

soon as practicable, a scheme in respect of annual service charges from which the OMC may discharge ongoing expenditure reasonably incurred on the provision of common or shared services to the owners and occupiers of the units in the development

Articles of Association - Annual Service Charge

• The annual service charge in respect of a MUD

relating to a particular period shall not be levied unless it has been considered by a general meeting of the members concerned called for that purpose

• If the proposed service charge is disapproved by

not less than 75% of the persons present and voting at the meeting, the proposed service charge shall not take effect

Articles of Association - Annual Service Charge

• Instead the charge applying for the previous

period shall continue to apply pending the adoption of a service charge for the period concerned

• If disapproved and no service charge applied in

the previous period, the directors may determine a scheme for four months

Articles of Association - Sinking Fund

• Sec 19 (MUD Act) - An OMC shall establish a

sinking fund for the purposes of discharging expenditure reasonably incurred on the MUD.

• Sec 19 sets out the expenditure the sinking

fund maybe used for including expenditure on maintenance of a non-recurring nature

Articles of Association - Sinking Fund

• The owner of each unit in a MUD shall be
• bliged to make payment to the sinking fund
• f the amount of contribution fixed in respect
• f the unit concerned.
• The amount of the contribution to be paid by

each unit owner to the sinking fund in respect

• f each particular year shall be the amount of

€200 or such other amount as may be agreed by a meeting of the members

Articles of Association – House Rules

• An OMC may make house rules as respects the

development or part of the development relating to the effective operation and maintenance of the development and with the objective of enhancing the quiet and peaceable occupation of units generally in the development

• House rules shall not be made unless the rules

have been considered and approved by a meeting of the members not less than 21 days notice is given to each member

Articles of Association - Directors

• A person shall not be appointed as a Director
• f an OMC for life or for a term greater than 3

years.

• If this situation existed the Director must have

resigned within 3 years of enactment of the MUD Act.

Articles of Association - Contracts

• An OMC shall not, enter into a contract for the

provision of a service or the purchase of goods—

• which is expressed to run for a period in excess of 3

years from the date the contract is entered into by the OMC, or

• which provides for a penalty to be imposed on or

damages to be paid by the OMC if the contract is terminated by it after a period of 3 years from the date the contract is entered into by the owners’ management company.

What Is Annual Company Secretarial Compliance?

• Prepare & File an Annual Return & upload the

Financial Statements

• Hold Directors Meeting to Approve & sign

Financial Statements

• Prepare and Hold an AGM
• Maintain the Statutory Register & Minute Book

and comply with disclosure requirements

• Update the Register of Beneficial Owners where

necessary

Audit or Audit Exempt

• A CLG may avail of the requirement to have the

financial statements audited if under the audit exemption thresholds

• One member may object in writing one month

before the financial year end in which the exemption is to be availed of

Holding Company Meetings

• An important requirement in the governance of

any company is making decisions

• The Covid-19 pandemic has made the holding
• f meetings and the governance of a company

more difficult

• Review the constitution, Companies Act 2014,

MUD Act and obtain legal advice prior to holding meetings

Holding Company Meetings

• Physical meetings should not be held and if they

do social distancing should be strictly observed

• Member meetings should consider dispensing,

adjourning, using proxy forms or using written resolutions

• If AGM is not held there may be issues with

directors continuing who were due to retire by rotation or the approval of the annual service charge and contribution to the sinking fund

Holding Company Meetings

• Board (Directors) Meetings
• Physical Meeting
• Electronic Meeting
• Written Resolution
• Members Meetings
• AGM or EGM
• Physical Meeting
• Electronic Meeting
• Written Resolution

Company Meeting Rules to Review

• Electronic Meeting Provisions
• Who has the power to convene
• Notice – Contents, notice period, entitled to receive
• Location
• Proxy Forms (Member meetings)
• Quorum
• Chairperson
• Voting
• Minutes

Board Meetings

• CA 2014 – Part 4 Corporate Governance - Chapter 4
• Sec 157-167 may be amended in the constitution
• Sec 158 The business of the company shall be managed by

its directors who may pay all expenses incurred in promoting and registering the company and may exercise all such powers of the company as are not, by this Act, (the MUD Act) or by the constitution, required to be exercised by the company in general meeting

• Sec 160 - The directors of a company may meet together

for the dispatch of business, adjourn and otherwise regulate their meetings as they think fit.

Board Meetings

• Electronic Meeting: Sec 161 (6) - A meeting of the

directors or of a committee may consist of a conference between some or all of the directors who are not all in one place, but each of whom is able (directly or by means of telephonic, video or

• ther electronic communication) to speak to each of

the others and to be heard by each of the others and shall be counted in the quorum and entitled to vote

• Meeting occurs at place with largest group or where

the chairperson is located or the meeting decides the location– important for tax residency

Board Meetings

• Convene: Sec 160 (3) - A director may, and the

secretary on the requisition of a director shall, at any time summon a meeting of the directors.

• Notice: All directors are entitled to reasonable

notice

• Quorum: necessary for the transaction of the

business of the directors may be fixed by the directors, and unless so fixed shall be 2 but, where the company has a sole director, the quorum shall be one.

Board Meetings

• Chairperson: The directors may elect a

chairperson of their meetings and determine the period for which he or she is to hold office

• Voting: Questions arising at any such meeting

shall be decided by a majority of votes and where there is an equality of votes, the chairperson shall have a second or casting vote.

• Written Resolutions: permitted in Sec 161 (1) –

all the directors must sign and resolution can consist of several documents and is effective from the time the last director signs

Board Meetings - Minutes

• Sec 166 (1) A company shall cause minutes to be entered in

books kept for that purpose of all resolutions and proceedings at all meetings of its directors and of committees of directors.

• Such minutes shall be entered in the foregoing books as

soon as may be after the resolution concerned has been passed.

• Any such minute, if purporting to be signed by the

chairperson of the meeting at which the proceedings were had, or by the chairperson of the next succeeding meeting, shall be evidence of the proceedings.

• ODCE has right to access the minute book

General Meetings

• CA 2014 – Part 4 Corporate Governance

Chapter 6

• Members meetings – AGM’s & EGM’s
• AGM – statutory requirement
• EGM – to consider and if thought fit pass a

resolution

• Resolutions may also be passed by written

resolution

• Optional Provisions may be amended in the

constitution

Annual General Meeting

• Sec 175 (1) - A company shall in each year

hold a general meeting as its annual general meeting and not more than 15 months shall elapse between AGM’s

• Sec 17 (MUD) - Annual Meeting once each

year for consideration of annual report

• First AGM must be held within 18 months of

Date of Incorporation

• Financial Statements to be laid before

members within 9 months of financial year end

General Meeting – Electronic Meeting

• Sec 176(4) - A meeting may be held in 2 or more

venues (whether inside or outside of the State) at the same time using any technology that provides members, as a whole, with a reasonable

• pportunity to participate
• No limit on the number of venues
• Details should be sent out on the notice
• Advice on whether technology allows attendees to

vote and if the constitution provides for this

General Meeting – Adjourn the Meeting

• Member meetings may be adjourned and re-

convened to a later date.

• The meeting must be held first with a quorum and

then immediately adjourned to a later date

General Meeting – Location

• Sec 176 - an annual general meeting of a

company or an extraordinary general meeting of it may be held inside or outside of the State

• Sec 17 (MUD Act) - meeting to take place

within reasonable proximity of the MUD and at a reasonable time unless agreed in writing by 75% of the members

• Careful consideration to the location of the

venue given the current restrictions

General Meeting – Convening

• The directors of a company may, whenever they

think fit, convene an extraordinary general meeting

• Sec 178 & 1203 - The directors of a company shall,
• n the requisition of one or more members holding,
• r together holding, at the date of the deposit of the

requisition, not less than 10 per cent of the total voting rights of all the members having, at the date

• f the deposit, the right to vote at general meetings of

the company, forthwith proceed duly to convene an extraordinary general meeting of the company

General Meeting - Notice

• Sec 180 – Notice of every general meeting
• f a company shall be given to
• Every member (whether entitled to vote or not),
• personal representative of a deceased member

with right to vote,

• the assignee of a bankrupt member,
• the directors & the secretary

General Meeting - Electronic Notice

• Sec 218 – Notice may be sent electronically if

constitution contains provisions (Optional provision)

• That the member has consented in writing to

the company, or the officer of it, using electronic means to serve or give notices in relation to him or her

General Meeting - Notice & Short Notice

• Sec 181 – Unless the constitution provides for

longer notice, notice shall be:-

• 21 days notice for AGM & passing special resolutions
• 7 days notice for EGM
• Meeting maybe held at shorter notice if all

members entitled to attend and vote and the auditors consent in writing

• Neither the day on which the notice is served nor

the day of the meeting for which it is given shall be counted

General Meeting - Notice Contents

• Should make it clear members should

not attend in person

• The notice of a meeting shall specify

(a) the place, the date and the time of the meeting;

(b) the general nature of the business to be transacted at the meeting; (c) in the case of a proposed special resolution, the text or substance of that proposed special resolution; and

General Meeting - Notice Contents

(If proxies are provided for in the constitution) (d) with reasonable prominence a statement that—

(i) a member entitled to attend and vote is entitled to appoint a proxy using the form set out in section 184 to attend, speak and vote instead of him or her; (ii) a proxy need not be a member; and (iii) the time by which the proxy must be received at the company’s registered office or some other place within the State as is specified in the statement for that purpose.

AGM – Sec 186 Standard Business

a) the consideration of the Company’s statutory financial statements and the report of the directors and, unless the Company is entitled to and has availed itself of the audit exemption under section 360 or 365, the report of the statutory auditors on those statements and that report; b) the review by the members of the Company’s affairs; c) the declaration of a dividend (if any) of an amount not exceeding the amount recommended by the directors; and d) the authorisation of the directors to approve the remuneration of the statutory auditors (if any); e) save where the Company is entitled to and has availed itself of the exemption referred to in paragraph (a), the appointment or re- appointment of statutory auditors. f) Retirement by rotation

OMC AGM Additional Requirements

• Sec 17 (MUD Act) - A copy of the OMC annual

report to be furnished to each member at least 10 days before the meeting

• Consideration of the annual service charge
• Consideration of the contribution to the sinking

fund

OMC Annual Report

• a statement of income and expenditure relating to the period

covered by the report;

• a statement of the assets and liabilities of the company;
• where the owners’ management company is required to establish

and maintain a sinking fund—

(i) a statement of the funds standing to the credit of the sinking fund, and (ii) details of the amount of the annual contribution to the fund and the basis on which such contribution is calculated;

• a statement of the amount of the annual service charge and the

basis of such charge in respect of the period covered by the report;

• a statement of the projected or agreed annual service charge

relating to the current period;

OMC Annual Report

• a statement of any planned expenditure on the refurbishment,

improvement or maintenance of a nonrecurring nature which it is intended to carry out in the current period;

• a statement of the insured value of the multi-unit development,

the amount of the premium charged, the name of the insurance company with which the policy of insurance is held and a summary of the principal risks covered;

• a statement setting out, in general terms, the fire safety

equipment installed in the development and the arrangements in place for the maintenance of such equipment; and

• a statement fully disclosing any contracts entered into or in force

between the owners’ management company and a director or shadow director of the company or a person who is a connected person as respects that director or shadow director

General Meeting - Quorum

• Sec 182 - No business shall be transacted at any

general meeting of a company unless a quorum

• f members is present at the time when the

meeting proceeds to business.

• Save to the extent that its constitution provides
• therwise 2 members of a company present in

person or by proxy at a general meeting of it shall be a quorum.

• Various opinions on whether electronic presence

is deemed to be present in person so advice should be obtained

General Meeting – Proxy Forms

• Sec 183 & 1205 - any member of a company entitled to attend

and vote at a meeting of the company shall be entitled to appoint another person (whether a member or not) as his or her proxy to attend and vote instead of him or her.

• May only appoint one proxy unless constitution provides
• therwise – Optional provision for a CLG
• Useful to appoint the chairperson of the meeting in case the

proxy cannot attend the meeting given the restrictions

• Proxy form to be deposited at the registered office 48 hours

before the time for holding the meeting

• Sec 184 – Form of proxy

General Meeting – Proceedings at Meetings

• Sec 187 - The chairperson, if any, of the board of directors shall preside

as chairperson at every general meeting of the company

• Unless a poll is demanded in accordance with section 189, at any general

meeting— (a) a resolution put to the vote of the meeting shall be decided on a show of hands; and (b) a declaration by the chairperson that a resolution has, on a show of hands, been carried or carried unanimously, or by a particular majority,

• r lost, and an entry to that effect in the book containing the minutes
• f the proceedings of the company shall be conclusive evidence of the

fact without proof of the number or proportion of the votes recorded in favour of or against such resolution.

General Meeting – Proceedings at Meetings

• Where there is an equality of votes, whether on

a show of hands or on a poll, the chairperson

• f the meeting at which the show of hands

takes place or at which the poll is demanded, shall be entitled to a second or casting vote.

General Meeting - Voting

• Sec 188 & 1206 Companies Act 2014 & Sec

14 MUD Act

• Where a matter is being decided (whether
• n a show of hands or on a poll), every

member present in person and every proxy shall have one vote of equal value for each unit he owns in the development and no

• ther person other than the unit owners

shall have a vote

General Meeting - Voting

• No Member shall be entitled to exercise a vote

in respect of a Unit at any general meeting (or by signing a resolution in writing) unless all moneys payable to the Company including any service charge or sinking fund contributions in respect of that Unit have been paid in full

General Meeting Right to Demand a Poll

• Sec 189 - At a meeting, a poll may be demanded in relation to a matter

(whether before or on the declaration of the result of the show of hands in relation to it).

• (2) A demand for such a poll may be made by—

(a) the chairperson of the meeting; (b) at least 3 members present in person or by proxy; (c) any member or members present in person or by proxy and representing not less than 10 per cent of the total voting rights of all the members of the company concerned having the right to vote at the meeting; or

General Meeting - Minutes

• Sec 199 A company shall, as soon as may be after their

holding or passing, cause—

(a) minutes of all proceedings of general meetings of it, and (b) the terms of all resolutions of it, to be entered in books kept for that purpose; all such books kept by a company in pursuance of this subsection shall be kept at the same place.

• Any such minute, if purporting to be signed by the

chairperson of the meeting at which the proceedings were had, or by the chairperson of the next succeeding meeting, shall be evidence of the proceedings.

• Members right to inspect in accordance with Sec 215 to

217 of Companies Act 2014

Types Of Member’s Resolutions

• Act sets out in the appropriate sections where it requires an
• rdinary or special resolution
• Sec 198 - Special resolutions & certain ordinary resolutions to be

filed with CRO within 15 days

• Always check whether a director or members resolution is

required and if a members’ resolution is required is it an ordinary

• r special resolution
• Ordinary Resolutions – passed by more than 50% of members

and 7 days notice given

• Special Resolutions – passed by not less than 75 % of members

and 21 days notice given

• MUD Act – some resolutions require a simple majority, 60% or

75% of the members to approve

Written Resolutions

• Sec 192 (8) “a written resolution means either an
• rdinary resolution or special resolution passed in

accordance with Section 193 or 194”

• Written Resolutions must be kept like minutes
• Unanimous written resolutions (Sec 193)
• All members sign & becomes effective on date last

member signed

• Majority written resolutions (Sec 194) are dis-

applied for CLG’s

Common Changes in an OMC

• Filing a CRO form does not give the proposed

change legal effect!

• The necessary resolution must be approved

either by the directors or the members, the statutory register updated and the necessary form filed in the CRO and the Register of Beneficial Owners updated if required

Appointing an additional or alternate director

• Having additional directors or alternate

directors (or a registered person) to act and sign on behalf of the company may assist in the running of the company

• Appointment of the directors should be

carefully considered by the existing directors and any potential new directors

Appointing an Additional Director

• Review the constitution
• Typically a matter for members however the

directors have the right to fill a casual vacancy

• Board or member meeting to be held at which the

appointment is approve, register is updated and B10 filed

• The date of the resolution to appoint the director

is the effective date not the filing of the B10 in the CRO

Ceasing to Act as a Director

• Retire at the AGM and not re-elected
• Sec 148 - The office of director shall be vacated if the director:

(a) Is adjudicated bankrupt or being a bankrupt has not

• btained a certificate of discharge in the relevant

jurisdiction; or (b) Becomes or is deemed to be subject to a disqualification order within the meaning of Chapter 4

• f Part 14.
• Save to the extent that the company’s constitution provides
• therwise, the office of director shall be vacated if:

(a) The director resigns his or her office by notice in writing to the company; or

Ceasing to Act as a Director

(b) The health of the director is such that he or she can no longer be reasonably regarded as possessing an adequate decision making capacity; or (c) A declaration of restriction is made in relation to the director and the directors, at any time during the currency of the declaration, resolve that his or her

• ffice be vacated; or

(d) The director is sentenced to a term of imprisonment following conviction of an indictable offence; or (e) The director is for more than 6 months absent, without the permission of the directors, from meetings of the directors held during that period.

Removal of a Director

• A director may be removed from office by
• rdinary resolution of the members
• Obtain legal advice prior to pursuing this!

Appointment of a Company Secretary

• Sec 129 - The secretary shall be appointed by the

directors of the company for such term, at such remuneration and upon such conditions as they may think fit; and any secretary so appointed may be removed by them

• The directors of a company shall have a duty to

ensure that the person appointed as secretary has the skills or resources necessary to discharge his or her statutory and other duties

Changing the Constitution

• Directors should prepare a new draft of the

constitution

• Convene an EGM of the members
• Pass a special resolution (75%)
• File a G1 and the new constitution
• Send copy of new constitution to every

member

OMC Restoration

• Sec 30 -Where a OMC has been struck off the register,

if a member or officer of a company is aggrieved by the fact of the company having been struck off the register, the registrar of companies,

• An application made by the member or officer before

the expiration of 6 years from the publication in Iris Oifigiúil of the notice that the company was struck off the register, provided that the registrar has received all annual returns outstanding, if any, from the company, may restore the name of the company to the register.

OMC Restoration

• This Sec applies to an OMC which immediately prior to

the name of the company having been struck off the register the OMC had vested in it ownership of the common areas or a part thereof of the MUD in respect

• f which the company was incorporated.
• Each application shall be accompanied by a certificate

from a solicitor or an accountant certifying that the company is an owners’ management company

• perating as such.
• After 6 years or the OMC does not satisfy the criteria

above, an application must be made to the High Court

Duties of Directors

• Sec 223 - It is the duty of each director of a

company to ensure that this Act is complied with by the company

• Sec 227 - A Director of a Company shall owe

the duties in Sec 228 to the Company and the Company alone

Sec 228: Fiduciary duties of directors

• Act in good faith in what the director considers

to be the interests of the company;

• Act honestly and responsibly in relation to the

conduct of the affairs of the company;

• Act in accordance with the company’s

constitution and exercise his or her powers only for the purposes allowed by law;

Sec 228: Fiduciary duties of directors

• Not use the company’s property, information or
• pportunities for his or her own or anyone else’s

benefit unless—

• (i) this is expressly permitted by the company’s

constitution;

• r
• (ii) the use has been approved by a resolution of the

company in general meeting;

• Not agree to restrict the director’s power to exercise an

independent judgment unless—

• (i) this is expressly permitted by the company’s

constitution; or

• (ii) the case concerned falls within subsection (2);

Sec 228: Fiduciary duties of directors

• Avoid any conflict between the director’s duties

to the company and the director’s other (including personal) interests unless the director is released from his or her duty to the company in relation to the matter concerned, whether in accordance with provisions of the company’s constitution in that behalf or by a resolution of it in general meeting;

Sec 228: Fiduciary duties of directors

• Exercise the care, skill and diligence which would

be exercised in the same circumstances by a reasonable person having both:

(i) The knowledge and experience that may reasonably be expected of a person in the same position as the director; (ii) The knowledge and experience which the director has;

• in addition to the general duty owed to employees

under section 224, have regard to the interests of its members.

Statutory Duties of Directors

• Sec 281 - Duty to Keep Adequate Accounting

Records

• Sec 290-295 Duty to Prepare Financial Statements
• Directors to provide a statement that there is no

relevant audit information of which the company’s auditors are unaware of – Sec 330

• Duty to File Annual Return and Financial

Statements on time with the CRO (Sec 343)

Statutory Duties of Directors

• Approve & Sign Financial Statements – Sec 324
• Approve & Sign Directors Report – Sec 332
• Sec 333 - Obligation to have Statutory Financial

Statements Audited

• Duty to File Certain Documents with CRO

Statutory Duties of Directors

• Duty of Disclosure –
• Personal Information – (Sec 149)
• Interest in Shares (Sec 261)
• Interest in Contracts (Sec 231)
• Disclose Relevant Audit Information (Sec 330)

Statutory Duties of Directors

• Duty to disclose information on business letters

and website (Sec 151)

• Duty to convene General Meetings of the

Company (Sec 175)

• Duty to comply with Non-Cash Transactions

Involving Directors (Sec 238)

• Duty of Directors of Companies in Liquidation

and Directors of Insolvent Companies

ODCE Guidance

• ODCE has no role in relation to breaches of the

MUD Act, regulation of management agents (that’s a function of the PSRA), or service charge debt recovery

• Directors Duties Guidance Note
• ODCE Handbook On Residential Property Owners’

Management Companies

• ODCE Guidance for Directors of companies facing

insolvency due to impact of Covid-19

Clúid Housing and the Housing Agency Report

• The report makes 14 recommendations and the

key recommendation of this report is that the Government establish a regulator for OMCs on a statutory basis

• OMC annual return filing with Regulator instead of

CRO

• Mandatory Director Training & Code of Conduct
• Removal of audit exemption for OMC’s

Essential Advice for Directors

• Become aware of the duties and responsibilities

you have as a director

• Consider completing a director training course &

adopting a Governance Manual

• Engage with experienced accounting, tax and

company secretarial advisors & property advisors

• Keep up to date accounting records and review
• Meet regularly

Essential Advice for Directors

• Seek advice before acting & have necessary

authority to make the decisions

• Document key decisions and advice taken as

proof the directors are acting in the best interests of the company

• File Annual Returns and financial statements on

time

• Don’t put off difficult decisions

More Information

• CLS News – Articles on Company Law topics
• Companies Registration Office
• www.icsacharteredsecretaries.ie

Thank you for your Attention! Any Questions or Comments?

How Can We Help You?

CLS provides expert Company Law, Company Secretarial and Company Formation services to our clients around Ireland and internationally

059-91-86776 conor@clscs.ie

www.clscharteredsecretaries.ie

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Disclaimer

Information provided is general in nature and shared in order to be helpful. It should not be considered to amount to legal advice, and no reliance should be placed on it. The Housing Agency and The Chartered Governance Institute ICSA cannot be held responsible for action or failure to act on foot of the information provided. Professional advice might be necessary on individual circumstances. This material is available to re-use, provided the Re-Use

• f

Public Sector Information (https://www.housing.gov.ie/corporate/compliance/other/re-use-public-sector-information) requirements are fulfilled.