Dissatisfied with Owners Association (VvE)-manager? There is something you can do.

In my practice, I come across it regularly. Complaints about VVE managers. The complaints vary, but there are a number of recognisable elements, such as poor communication, slow reaction to complaints and inefficient use of financial resources.

Although there is a lot of dissatisfaction lurking, it is not (yet) common for real action to be taken. As a result, the VVE manager remains and continues working the same way, while the service provision leaves much to be desired.

That is why it ss special that I recently had the opportunity to deal with a case in which a number of VVE residents no longer accepted it, which eventually led to proceedings. It is interesting how the judge has assessed the manager’s actions.

What on earth was going on? In a VVE in Amsterdam of approx. 280 apartments, a housing corporation owns the majority. A party affiliated with the housing corporation has been appointed as manager.

In practice, however, there are many complaints about the conduct of the manager. A selection of the complaints:

– Slow response to repair requests from residents: There were cases known of residents who literally had fungal problems for years because of leaks, without any actions being taken;

– Insufficient check on suppliers’ invoices: Typical example of this is that an order was given to mop up some dirt on one of the stairs in the stairwell. € 800,- was invoiced for this, according to the specification 10 man-hours and 10 hours of parking. Not only was this out of proportion, it was also free parking that day so this was not correct either. Nevertheless, the manager paid for it without asking questions;

– Lack interest with procurement: A new building insurance was taken out, where the premium went over five times, from ca € 10.000,- to € 50.000,-. Upon enquiry it appeared that the manager had not asked for more than one offer.

Another factor was that the manager was not independent of the housing corporation. For this reason, there was too little opposition to plans of the housing corporation that were not in the interest of other members. For example, a neighbourhood manager was appointed at the expense of the VVE for € 18,000 per year, who was employed by the housing corporation but had little added value for the VVE.

A number of VVE members were distressed by these developments and collected the various complaints and also discussed them with the manager. After no improvement was made, a meeting of the VVE was proposed to terminate the management agreement. This was blocked by the majority vote of the housing corporation.

Subsequently, the VVE members submitted this decision to the Subdistrict Court. On the initiative of the Subdistrict Court, a committee was even set up to examine the actions of the manager. The majority of this committee advised negatively on the continuation of the management relationship,

In the end it weighed heavily on the Subdistrict Court that there were many different complaints about the manager, this in combination with the non-independent position. The court therefore annulled the decision that the manager could remain and ruled that the board was authorised to terminate the management agreement.[1] In the meantime, the management agreement has indeed been terminated and a new manager is ready to take over his place.

The lessons learned from this are the following:

1. Collect the complaints and substantiate them with documentation: It is of course important if there is dissatisfaction about the manager that you underpin your complaints. Just “not being satisfied” without clarifying the why will not change the situation. It is therefore essential to provide good insight into what is going wrong.
2. Firstly, start a conversation with the manager: It is important that the manager gets a chance to improve first. Use the documentation to make clear what complaints there are and make measurable agreements to improve management. If this goes well, then the problem is solved. Otherwise it is time for the next step.
3. Check the cancellation options in the management agreement and prepare a good alternative: If the VVE already wants to appoint a new administrator, it must be clear by what deadline this can be done. It is also important to have selected a good alternative, or preferably more than one, so that it is possible to switch to a new administrator immediately.
4. Ensure support within the VVE: The possible transfer to a new administrator is a major decision. That is why it is important to inform and keep the VVE members informed as much as possible. In practice, there are always members of the VVE who hardly ever concern themselves with VVE matters, but at the same time want good management. It is also necessary to keep them well informed so that they know what is going on.
5. Submit the termination of the management agreement and the appointment of a new administrator to the VVE meeting: Based on the documentation and possibly the (unsuccessful) improvement process, the reasons for proposing a new administrator can be explained in the VVE meeting. In order to be able to proceed quickly, it is a good idea to vote on the alternative in the same meeting, or in a meeting shortly afterwards.

In case a member of the VVE blocks the decision-making with a majority vote because of links with the administrator or for any other reason, it is possible to submit this to the subdistrict court within 1 month after the VVE meeting.

Would you like to know more?

Contact Ginio Beij (beij@m2advocaten.nl).

1] Subdistrict Court of Amsterdam 28 June 2017 Case no. 5453726 v. EA-VERZ 16-1264 (unpublished)