MULTI UNITS ACT & MEDIATION

This Act establishes a new Circuit Court jurisdiction to deal with disputes between parties and concerns residential developments of 5 or more units. Developments with a mix of residential and commercial units are also dealt with.

However, if mediation or another form of dispute resolution has not already been attempted, the Court may require the parties to engage in a mediation process. Costs may be awarded against a party which does not engage in a meaningful way in such mediation.

Our services help parties engage in mediation. We facilitate discussions in order to achieve a positive amicable agreement for all parties.

 

Please call us today to see if we can help you or your client on 087 98 32 112. Or email mediation@live.ie

The Act is discussed in further detail below:

The Multi unit development act is  discussed below it is not intended to be legal advice. Although Mary Claire McCarthy is a solicitor she is not practising and does not give legal advice but facilitates discussion through mediation

In Ireland for the first time there is a statutory framework for multi unit developments. It provides for mediation as a form of dispute resolution whereby the mediator submits a report to the court  after such mediation takes place.

This new piece of legislation deals with a number of problem  areas that arose particularly during the boom years in Ireland between home owners and large developers. These issues included the transfer of common areas in developments, the actual completion of developments, service charges and indeed the duties of management companies.

This Act covers residential developments of five or more units sharing amenities, facilities and services. Developments with a mix of residential and commercial units are also dealt with. For example this act may also include a child care facility.

Section 3 of the Act outlines the major changes;

Under this section a developer cannot transfer an interest in a residential unit unless:

  1. A management company has been established (at the expense of the developer).
  2. The common areas and the reversion in the residential unit have been transferred to the management company
  3. The management company is issued with a certificate from a suitably qualified person to the effect that the issue of the fire safety certificate for the development has been complied with.
  4. The management company & the developer have entered into an agreement outlining the rights & obligations including those regarding dispute resolution (mediation).
  5. Establishment of a sinking fund by 1st October 2012.
  6. One vote is attached to each residential unit.

What is interesting is that the Act applies not only to new developments but to existing multi unit developments.

Developers of existing developments who have not yet transferred the common areas and the reversion of the units to the management company are now under a time constraint. Basically, sections 4 & 5 state that for existing developments where the common areas and the reversion have not yet been transferred to the management company there is a six month deadline within which to do so. This deadline is October 1st 2011. However, the beneficial interest will be reserved to the developer to facilitate the completion of the development.

But, once the development stage has ended the developer will have to give a declaration (pursuant to s.11of the Act) that the beneficial interest in the common areas and the reversion has transferred to the management company .

A noteworthy aspect of the legislation is that once the common areas are transferred the developer will still have rights and obligations in relation to the completion of works. Section 7 clearly states this.

Section 9 obliges the developer to retain access rights to the development to affect completion and states that they must have adequate insurance in place in regard to risks. Section also states that the developer must indemnify the management company in respect of all claims arising out of any acts or omissions by him/her during the course of completing the development.

I very much welcome this new Act especially regarding mediation as the form of dispute resolution and the fact that the circuit court can make orders under the Act. Having worked as a solicitor in practice representing management companies I saw how frustrated both parties became. At least now with the new legislation in place parties will have an opportunity to sit down with a trained mediator and work out options for a mutually acceptable agreement that is fair to all parties.

About the Author:

Mary Claire McCarthy is an accredited full time mediator. Visit today for free mediation information http://www.mediationinsteadofcourt.ie/

She has extensive experience as a commercial lawyer (in Ireland and also qualified in UK & Wales) before retraining as  a full time mediator. She conducts several mediations per month and has a diploma in mediation as well as a law degree. She can travel to your local area to mediate. Please visit her website for information on a mediator www.mediationinsteadofcourt.ie Or phone 00353 8798 32 112. Email us: mediation@live.ie

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The above is not designed to be legal advice, readers are advised to seek legal advice from their own experts.

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