« 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?

Miceal McGovern was deemed disqualified pursuant to S.183 (2) of the Companies Acts 1963 for a period of 5 years commencing on the 12th of October 2004.

12 October 2004

Details of Defendants:
Tenants First (Ireland) Limited
Company Number: 255182
Registered Office: 21 Park Street, Dundalk, Co. Louth. 

Mr. Miceal McGovern AND Ms. Inge McGovern
Address: c/o 21 Park Street, Dundalk, Co. Louth. 

Venue:
Dundalk District Court. 

Judge:
District Judge Brennan 

Alleged Offence(s):
The defendants were each charged with three counts of contravening Section 202 of the Companies Act 1990, which requires the keeping of proper books of account. The charges related to the financial years ended 31st December 1997; 31st December 1998 and 31st December 1999. Miceal McGovern was further charged with contravention of Section 183 (1) of the Companies Act, 1963 in acting as a director of Tenants First (Ireland) Limited for the period 8th December, 1999 to 8th December, 2002 while he was an undischarged bankrupt within the meaning of Section 2(1) of the Companies Act, 1963 (as amended). 

Outcome:
The 9 charges of breach of S202, which were contested, were found to be proven by Judge Brennan. On conviction the Court imposed fines totalling €150 against each defendant and awarded prosecution costs totalling €1,041.93. In addition, witness expenses totalling €300 were awarded against the company. 

The charge in relation to S183, which was contested, was also found proven. Miceal McGovern was convicted of this offence, fined €50 and ordered to pay prosecution costs of €217.08 and witness expenses of €250. The court noted that, having been convicted of an offence under Section 183(1) of the Companies Act 1963, Miceal McGovern is deemed, pursuant to Section 183(2) of the same act, to be the subject of a disqualification order. The effect of this provision is that Miceal McGovern is disqualified from holding the position of director in any company registered in the State for a period of 5 years commencing 12th October, 2004. Recognisance was fixed by the Court in respect of each party in the event of an appeal. 
 

Update 30/11/04: This option was not availed of by the defendants.

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