Review and operation of the Multi-Unit Development Act 2011

QUESTION

To ask the Minister for Justice and Equality his plans to review the Multi-Unit Development Act 2011 with regard to sinking fund contribution minimum levels; and if he will make a statement on the matter.

REPLY

The position is that the Multi-Unit Developments Act 2011 was enacted with the primary purpose of reforming the law relating to the ownership and management of common areas of multi-unit developments and facilitating the fair, efficient and effective management of owners' management companies (OMCs).  These are companies registered under the Companies Acts, the members of which are the owners of residential units within the development and which are established for the purposes of ownership and management of the common areas of that development.
Section 19(1) of the Act provides that an OMC must establish a sinking fund for the purpose of discharging expenditure reasonably incurred on the refurbishment,  improvement or maintenance of a non-recurring nature of the multi-unit development concerned.  Section 19(3) obliges the owner of each unit in the multi-unit development to make payment to the sinking fund of the amount of contribution fixed in respect of the unit concerned. Section 19(5) provides that the amount of the contribution to be paid to the sinking fund in respect of a particular year shall be €200.00 or such other amount as may be agreed by the members of the OMC at a meeting.
Thus, while there is a legal requirement on each OMC to establish and maintain a sinking fund, the determination of the annual contribution to the fund is a matter for each OMC. In the absence of such a determination, a contribution of €200.00 shall continue to apply. Section 19(1)(a) provides that expenditure may be incurred from the sinking fund in order to obtain advice from a suitably qualified person in relation to the likely reasonable costs of refurbishment, improvements or other expenditure of a non-recurring nature.
As regards the payment of agreed sinking fund contributions, section 22 of the 2011 Act provides that such contributions may be recovered by the OMC as a simple contract debt in a court of competent jurisdiction.
While I have no specific plans to review operation of the Multi-unit Developments Act 2011 at present, operation of the Act's provisions is kept under general review by my Department.