« back Management Companies
 

01 What is a Management Company?

A so called "management company" is a company registered in the CRO usually as a Company limited by Guarantee (CLG) or a Designated Activity Company (DAC),  with an object clause to manage a multi-unit development. The "management company" owns the common areas of the development such as: car parks, green space, stairwells, lifts and communal hallways and maintains them for the benefit of all property owners and typically provides for insurance cover.

On acquiring a unit within the development, in addition to the apartment or house such person also shares ownership of the common areas. Stemming from this, it is usually a condition of the purchaser's contract that they sign a co-ownership agreement which obliged them to become a member of the management company.    These co-ownership agreements are essentially rooted in the laws of contract and private property,  rather than in any particular Act of the Oireachtas.  Following on from this, it should be clear that the requirement to become a member of a management company is not a requirement under company law. 

There is no special body of company law which applies only to so called "management companies" or is applied differently so far as management companies are concerned.  The "FAQ" (Frequently Asked Questions) section of this website answers most general company law type questions in relation to all companies.  Most of the issues arising in the so called "management companies" are not company law issues and the ODCE cannot assist.   The attached document lists the breaches of company law where ODCE can assist with.

02 Are management companies a product of company law?

No. It is important to stress that management companies have no special meaning and are in no way a requirement of company law. There is nothing in the Companies Act which states that a management company must be brought into existence in connection with any multi-unit development, and some multi-unit developments exist which do not have a management company associated with them. Furthermore, it is important to point out and emphasise that there is no special body of company law that applies solely to management companies.

03 Where can I find the legal source from which management companies operate?

The Director of Corporate Enforcement AND James Pierce AND Rosemary Pierce In the matter of James Pierce & Sons Limited.

18 December 2006

The Director of Corporate Enforcement AND James Pierce AND Rosemary Pierce In the matter of James Pierce & Sons Limited and in the matter of Section 160 of the Companies Act 1990. 

Details of Respondents 
James Pierce & Sons Limited
Company Number: 227621
Registered Office: Ballingar, Tullamore, Co. Offaly. 

James Pierce
Address: Ballingar, Tullamore, Co. Offaly. 

Rosemary Pierce
Address: Ballingar, Tullamore, Co. Offaly. 

Venue: 
High Court, Dublin. 

Judge: 
Justice Finlay Geoghegan J. 

The Application: 
Under section 160(2)(h) of the Companies Act 1990 (as amended by section 42(b) of the Company Law Enforcement Act 2001), the Director may seek the disqualification of the directors of a company, which has been involuntarily struck off the Register of Companies pursuant to Section 12 of the Companies (Amendment) Act 1982. 

Under section 160(3A), directors may successfully defend such an application for disqualification by demonstrating to the High Court that the company had no liabilities at the time of involuntary strike-off or that any such liabilities were discharged before the date of the making of the disqualification application. Where it deems that a sanction is appropriate, the Court has discretion to either disqualify the director for such period as it deems fit or restrict him or her for a five year period. 

Outcome: 
On 18th December 2006 James and Rosemary Pierce, who were directors of an insolvent company known as James Pierce & Sons Limited at the time it was struck off the Companies Register on 12th December 2003, were each made the subject of a disqualification order for a period of five years. The Court ordered that James Pierce AND Rosemary Pierce jointly and severally make a contribution to the costs of the Director measured in the sum of €2,000. 

The effect of this Order is that James and Rosemary Pierce are disqualified from being appointed or acting as auditor, director or other officer, receiver Liquidator or examiner or being in any way whether directly or indirectly concerned or taking part in the promotion, formation or management of any company or society registered under the Industrial Provident Societies Acts 1893 to 1978 for a period of 5 years commencing 18th December 2006.

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Telephone: +353 1 858 5800
Email: info@odce.ie