Condo owner rights - access to expense records?

[puuchaibaa]

I am a condo owner in Thailand. I do not hold a position in the owners' committee. Do I have any right to access expense records pertaining to the operation and maintenance of the condo building? That is, can I walk into the management office and ask to review/photocopy any and all invoices and service contracts?

I realise the role of the owners' committee is to oversee these things on behalf of the rest of us. However, if the efficacy of the committee is lacking, there should be a way for owners to take things into their own hands. Of course we can vote for a different committee but that process takes time.

[cheeryble]

There is an obligation for financial rundown to be posted monthly.

Likewise there must be audited and signed off accounts produced every year, presumably by a licensed company.....these obviously have legal repercussions.

I don't know if you have any more right than that.

[Delight]

The management structure of a condo is similar to that of a public company

As a shareholder of a public company you cannot walk into an office and demand financial information as per your OP.

Same with a condo

You can however join the condo committee.

It’s about rights and responsibilities.

The other option is to call a Extra general meeting.

You will need to be supported by fellow co -owners. A total of 20% of the building vote( between you all )is required.

[beano2274]

in my condo they put them on a notice board for everyone to see.

[HerbalEd]

There is an obligation for financial rundown to be posted monthly.

Likewise there must be audited and signed off accounts produced every year, presumably by a licensed company.....these obviously have legal repercussions.

I don't know if you have any more right than that.

What about a villas development where the developer has about 4 more months to go before finishing the last two villas before turning the management of the development over to the villa owners? Do the villa owners have the same legal rights to see how our fees and sinking fund are being managed and to see an audit?

We have asked several lawyers this same question and none have had the answer.

It appears there are not a set of laws and regulations that cover villa developments like there are for condos. Or at least that's what we are told by multiple lawyers.

[AlQaholic]

I am a condo Committee member.

According Thai law the monthly account report must be posted on the condo board. As said previously annual audited accounts must be presented at the A.G.M.

For Individual requests to see various contracts and other documents pertaining to the operation of the Condo, the committee and management can make case by case decision at their discretion, usually based on reason for the request, behavior of requester e.c.t.. They have no formal or legal obligation to present any documents other than those required by law or the Condo Bylaws.

If a faction of co-owners are not happy with the Committee, if they have enough votes together (20% of all the condo votes) they can call an E.G.M. (Extraordinary General Meeting) and vote for a new Committee.

Edited July 20, 2015 by AlQaholic

[BlackJack]

it may not do you any good to see the accounts anyway as they have this big column that says other

and normally there is no breakdown of these

what may be classified as accounting is somewhat different here with above the line and below the line costs

once a month they should post something on the common board and you can see what comes in and what goes out - but there is no real breakdown of things

[AlQaholic]

There is an obligation for financial rundown to be posted monthly.

Likewise there must be audited and signed off accounts produced every year, presumably by a licensed company.....these obviously have legal repercussions.

I don't know if you have any more right than that.

What about a villas development where the developer has about 4 more months to go before finishing the last two villas before turning the management of the development over to the villa owners? Do the villa owners have the same legal rights to see how our fees and sinking fund are being managed and to see an audit?

We have asked several lawyers this same question and none have had the answer.

It appears there are not a set of laws and regulations that cover villa developments like there are for condos. Or at least that's what we are told by multiple lawyers.

You are right, there are no laws covering "Moobaans". However the MooBaan communities are usually structured and run in exactly the same way as condos. The developer should call all owners to a meeting where they hand over all documentation and other items, facilitate election of a committee and appointment of a manager.

This is very important that it is done and to explain to all house owners how everything works and for owners to fully understand that they have to pay in advance every year for such items as garbage collection, gardening, security, maintenance of common areas, swimming pool if there is one, fitness center if there is one and so on.

If no Committee and manager is appointed, they moobaan will soon decay and loose value, the local authorities will take over the basic stuff such as garbage collection and sewage collection, water supply etc. and will bill each owner individually for those services.

[huawei]

According to the condominium act, A balance sheet and p/l MUST be advertised to the co- owners by the 15th of the following month. If this is not being done ask them why they are not complying with the act. The dishonesty we have had to deal with is just hard to comprehend.

[HerbalEd]

There is an obligation for financial rundown to be posted monthly.

Likewise there must be audited and signed off accounts produced every year, presumably by a licensed company.....these obviously have legal repercussions.

I don't know if you have any more right than that.

What about a villas development where the developer has about 4 more months to go before finishing the last two villas before turning the management of the development over to the villa owners? Do the villa owners have the same legal rights to see how our fees and sinking fund are being managed and to see an audit?

We have asked several lawyers this same question and none have had the answer.

It appears there are not a set of laws and regulations that cover villa developments like there are for condos. Or at least that's what we are told by multiple lawyers.

You are right, there are no laws covering "Moobaans". However the MooBaan communities are usually structured and run in exactly the same way as condos. The developer should call all owners to a meeting where they hand over all documentation and other items, facilitate election of a committee and appointment of a manager.

This is very important that it is done and to explain to all house owners how everything works and for owners to fully understand that they have to pay in advance every year for such items as garbage collection, gardening, security, maintenance of common areas, swimming pool if there is one, fitness center if there is one and so on.

If no Committee and manager is appointed, they moobaan will soon decay and loose value, the local authorities will take over the basic stuff such as garbage collection and sewage collection, water supply etc. and will bill each owner individually for those services.

The moobaan of which I write has not yet been turned over to present home owners, but present homeowners are already being billed for and are paying a yearly fee for garbage collection, landscape/garden maintenance, sewage, common property maintenance, security service, etc. And we also have paid a substantial sinking fund.

However, the developer refuses to give the present homeowners any accounting of those monies, and says they are not legally required to do so. Do you know if this is true?

My assumption is that that money has been misused or squandered. Otherwise why the secrecy?

[Minnehaha]

I am a condo Committee member.

According Thai law the monthly account report must be posted on the condo board. As said previously annual audited accounts must be presented at the A.G.M.

For Individual requests to see various contracts and other documents pertaining to the operation of the Condo, the committee and management can make case by case decision at their discretion, usually based on reason for the request, behavior of requester e.c.t.. They have no formal or legal obligation to present any documents other than those required by law or the Condo Bylaws.

If a faction of co-owners are not happy with the Committee, if they have enough votes together (20% of all the condo votes) they can call an E.G.M. (Extraordinary General Meeting) and vote for a new Committee.

Of course the easiest way to handle these situations is at the AGM. Before the AGM, attend the committee meeting and raise your issues. Send a memo to the committee after this and "ask that it be an agenda item on the AGM", and so you have 2 records. Go to the AGM and it should be on Agenda and then raise your issue at that time.

Further to this, you should politic to ensure you get what you want. You should find out who the committee members are and get to know them. Make friends with those that you can. Also find sympathetic owners. Prior to the AGM go to the owners, send a memo to them, buy them all coffee cards for Starbucks, or what have you. (I know a guy who manages / owns a national chain like this and he gave such cards to all the owners and it was a big hit for him.) So, you find the sympathetic people and get them to agree to vote with you. Do the math before the meeting and count your votes. It sounds like a lot but it really isnt a big deal. If you are pursuing something legitimate and right, most people will likely support you. However, if you are going against an influential person(s) or if you are concerned you won't have the support. Then you should think twice before making a racket.

Like many have said... choose your battles.

Most battles are won before they are fought.

To subdue the enemy without fighting is the acme of skill.

[mango66]

f you have a cheating developer , like i have in K Samui - Rep.... Condo,

he managed to have in only his members in the comitee,

we getting a monthly statement on the black board:

in 1.xxx mill - , payd 1.xx mill to the service company in contract !

The service company is his family company,

the rental management is his Hotel reception nearby;

He change rules in Comitee, when he have the mayority on the meeting , likes he want;

for last 3 years - maintanence fees risec every year for 15%,

you pay, or your water and electric is cutted of,

yourr keycard for pool and fitness is cancelled !

This are Thai laws !!

Welcome to Thailand !!

A high ranking law office recommand me: sell the Condo !!

( by the way , when i was on the buying interview - I had to stop and wait -

as soomeone from the L office just " Bought 2 Condos "

So you dont need to go to L office to claim any irregularieties in the Condo or Comitee _

the next whom the officer would call is your enemy the developer !! ))

[Kannikapor88]

Never buy property here - simply too mutt dishonesty and scam ...

[CapeThai]

Not trying to burst your bubble my dear friend, but condo management is Thai managed and your a 0 on the contract. Besides me also owning a freehold condo in Thailand a investor friend of mine owns about 40% all all freehold condos in a ( used to be very posh ) certain building and have the support of the other 9% foreign owners to change the management with absolutely NO Success. Its majority of 51% Thai ownership and even with all of his connections there is simply no light in the tunnel of selecting new management.

Call it a day, sell it for what you can get and move on.....

[huawei]

^^^ we managed it. Not all Thais will vote together. If he owns 40% he is in a very strong position.

[ripley]

"Cape Thai":

Not trying to burst your bubble my dear friend, but condo management is Thai managed and your a 0 on the contract. Besides me also owning a freehold condo in Thailand a investor friend of mine owns about 40% all all freehold condos in a ( used to be very posh ) certain building and have the support of the other 9% foreign owners to change the management with absolutely NO Success. Its majority of 51% Thai ownership and even with all of his connections there is simply no light in the tunnel of selecting new management.

Call it a day, sell it for what you can get and move on....

I think you just burst a lot of bubbles, my friend! When things are going sour w/ condo management the only recourse recommended here has been to gather enough like-minded owners to make 20% and call an EGM, by which means a committee can be dismissed and other actions taken. Seems, in your case, this didn't work out at all. (NO Success). Of course, one factor in your case seems to be that the 51% majority (Thai) actually participated in the EGM. Perhaps that percentage of active participation is rare?

As I've mentioned in other posts/topics, I'm watching the rate of success our committee and management is having by simply disregarding the owners' wishes and the law. So far, they're thriving - primarily because of owners' lack of interest, inability to form a united front, fear of reprisal and reluctance to incur legal fees.

Minnehaha:

Further to this, you should politic to ensure you get what you want. You should find out who the committee members are and get to know them. Make friends with those that you can. Also find sympathetic owners. Prior to the AGM go to the owners, send a memo to them, buy them all coffee cards for Starbucks, or what have you. (I know a guy who manages / owns a national chain like this and he gave such cards to all the owners and it was a big hit for him.) So, you find the sympathetic people and get them to agree to vote with you. Do the math before the meeting and count your votes. It sounds like a lot but it really isnt a big deal. If you are pursuing something legitimate and right, most people will likely support you. However, if you are going against an influential person(s) or if you are concerned you won't have the support. Then you should think twice before making a racket.

Like many have said... choose your battles.

Most battles are won before they are fought.

To subdue the enemy without fighting is the acme of skill.

If this is what you must do to have any hope of support in owners' acting for their own interests, I say with "Cape Thai": Move on."

[AlQaholic]

There is an obligation for financial rundown to be posted monthly.

Likewise there must be audited and signed off accounts produced every year, presumably by a licensed company.....these obviously have legal repercussions.

I don't know if you have any more right than that.

What about a villas development where the developer has about 4 more months to go before finishing the last two villas before turning the management of the development over to the villa owners? Do the villa owners have the same legal rights to see how our fees and sinking fund are being managed and to see an audit?

We have asked several lawyers this same question and none have had the answer.

It appears there are not a set of laws and regulations that cover villa developments like there are for condos. Or at least that's what we are told by multiple lawyers.

You are right, there are no laws covering "Moobaans". However the MooBaan communities are usually structured and run in exactly the same way as condos. The developer should call all owners to a meeting where they hand over all documentation and other items, facilitate election of a committee and appointment of a manager.

This is very important that it is done and to explain to all house owners how everything works and for owners to fully understand that they have to pay in advance every year for such items as garbage collection, gardening, security, maintenance of common areas, swimming pool if there is one, fitness center if there is one and so on.

If no Committee and manager is appointed, they moobaan will soon decay and loose value, the local authorities will take over the basic stuff such as garbage collection and sewage collection, water supply etc. and will bill each owner individually for those services.

The moobaan of which I write has not yet been turned over to present home owners, but present homeowners are already being billed for and are paying a yearly fee for garbage collection, landscape/garden maintenance, sewage, common property maintenance, security service, etc. And we also have paid a substantial sinking fund.

However, the developer refuses to give the present homeowners any accounting of those monies, and says they are not legally required to do so. Do you know if this is true?

My assumption is that that money has been misused or squandered. Otherwise why the secrecy?

From a legal point of view as I see it (and I happen to be in a similar situation in a development and have not paid for two years) there is no legal requirement for you to pay anything that is not in the contract. the developer may threaten you with this or that, do not pay any attention, from a legal point they have no authority to ask anything from you unless agreed upon either in a contract or a community meeting. You paid your house and that is it.

You can say "I will arrange my own garbage collection, you" and just burn the garbage across the street as I did 20 years ago hehe....no but seriously pay nothing until they present audited accounts and details of contracts with suppliers such as security and garbage handlers.

Edited July 20, 2015 by AlQaholic

[AlQaholic]

I wonder....A developer of a condominium stand a good chance of earning a reasonable amount money from the development. It does not matter if the development is crappy or good, there is profit in it anyway. So why on earth do some developers opt for the stupid way of doing a few more bucks cutting corners and trying to swindle off sinking funds, community charges and all the other stuff, why are there such people in the world who are completely void of any morals, decency, honor and honesty?

It is just sad and disgusting to see.

Edited July 20, 2015 by AlQaholic

[Eneukman]

There is an obligation for financial rundown to be posted monthly.

Likewise there must be audited and signed off accounts produced every year, presumably by a licensed company.....these obviously have legal repercussions.

I don't know if you have any more right than that.

That may be the law, but when I looked yesterday morning at the condo where I live, the financial details for June had not yet been posted. This is down to the sheer incompetence of the management company who should be kicked out. Fortunately, one of the committee members here has considerable experience in financial matters.

Alan

[Brit_Doggie]

In my condo such income notices are pinned up monthly but funny you might think the figures always balance the same imaterial of the number of people residing there per month now that is remarkable i just wish i could do the same.

[puuchaibaa]

​Thanks everyone for your input. Let me ask this. Has anyone actually seen a bylaw stating that owners do not have access to financial details?

I do not quite agree that the structure of a ​public company and that of a ​condo are similar​, at least not in principle​. As a​ basic ​shareholder of a public company, I do not pay it's operating expenses and do not expect to be privy to such details. ​I do as a condo owner and expect to know exactly what I am paying for, especially when certain expenditures are highly questionable. Monthly postings of the P&L doesn't cut it. Of course​ the​ finances are audited but audits do not hold much weight after seeing what can go on behind closed doors​ here.​

Fortunately the developer of my condo is a big listed company with a reputation to uphold. They were able to initiate ​some cooperation from management. However it's been a slow start as the managers would only let me inspect but not copy any documents​ (useless as for me as I can't read Thai). They said I have to g​o through​ the owners' committee first. I could probably get the developer to force the managers to give me exactly what I need. However I don't want to step on too many​ more​ toes at the moment so I will go through the committee first. The committee (or a particular member) might actually be part of the problem and I will find out soon enough.​

​
What I asked for (elevator maintenance just for starters) is not privileged information. There can be a logistics issue if perhaps several different owners wanted to see the books at different times, but this is not an issue here. And it's not like I've been banging on their door everyday to see this and that (this was the first time I made such a request). There is no legitimate reason for not letting me make a copy of the information. ​People tend to forget who it is the condo management works for.

Worse comes to worse, if I do not get sufficient cooperation from the committee and management, I will at least be able build a good case out of this episode to encourage other owners to make some changes.

Edited July 23, 2015 by puuchaibaa

[KittenKong]

A Thai condo legal structure is indeed very similar to that of a public company, though one that is designed to be zero-profit.

As your condo has little or no income apart from common fees then these have to fund the running of the business. A public company with little or no income would also need to either run up debt or make cash calls on shareholders (normally in the form of rights issues) to keep itself viable.

As a shareholder of a public company you can also ask for any information you want at an AGM or EGM. The same applies in a condo. In properly regulated countries this happens all the time and is quite effective. Here the smoke and mirrors that fill condos tend to make it less effective but it is still possible. Outside of a GM you can also ask a committee member to check on any particular item you wish and as part of their job management are obliged to give him that information (though they may not do so). The committee member may also refuse to help you or may just drag his feet.

The posting of monthly income/expenditure reports is a feature of the Condo Act and is designed to protect co-owners from abusive management. It should also be stipulated in the condo rules and regulations. The Condo Act requirement does not apply to normal companies which only have to produce yearly accounts. As has been mentioned, Thai accounting and auditing is often best described as a bad joke. Most accounting documents I have seen here would be thrown out in seconds in the West. But this doesnt mean that dishonesty is always the problem: simple crass incompetence is often to blame. I have seen documents here containing errors that a 10 year old western child would not make.

You should also find that your condo rules and regulations (these are available to you at all times, by law) may contain specific descriptions of what the management/committee has to do in certain circumstances.

[cheeryble]

A condo is indeed similar in ways to a public company in fact it is obliged to withhdld tax on certain payments for services in the same way on behalf of the govt.

There is undoubtedly corruption in many condos but for every genuine incident I also hear accusations where it is automatically assumed corruption is taking place. Throwing them out willy nilly is rife, and weakens a genuine case.

You have specific and evidenced concerns or are just suspicious?

Edited July 24, 2015 by cheeryble

[KittenKong]

There is undoubtedly corruption in many condos but for every genuine incident I also hear accusations where it is automatically assumed corruption is taking place. Throwing them out willy nilly is rife, and weakens a genuine case.

I often get the impression that our building management is too stupid to be dishonest.

Their faults seem to be mostly down to incompetence, bone-idleness and ass-covering.

It's very hard to tell the difference between that and dishonesty, especially as the end result (lost money) may be the same in both cases.

[AlQaholic]

​Thanks everyone for your input. Let me ask this. Has anyone actually seen a bylaw stating that owners do not have access to financial details?

I do not quite agree that the structure of a ​public company and that of a ​condo are similar​, at least not in principle​. As a​ basic ​shareholder of a public company, I do not pay it's operating expenses and do not expect to be privy to such details. ​I do as a condo owner and expect to know exactly what I am paying for, especially when certain expenditures are highly questionable. Monthly postings of the P&L doesn't cut it. Of course​ the​ finances are audited but audits do not hold much weight after seeing what can go on behind closed doors​ here.​

Fortunately the developer of my condo is a big listed company with a reputation to uphold. They were able to initiate ​some cooperation from management. However it's been a slow start as the managers would only let me inspect but not copy any documents​ (useless as for me as I can't read Thai). They said I have to g​o through​ the owners' committee first. I could probably get the developer to force the managers to give me exactly what I need. However I don't want to step on too many​ more​ toes at the moment so I will go through the committee first. The committee (or a particular member) might actually be part of the problem and I will find out soon enough.​

​

What I asked for (elevator maintenance just for starters) is not privileged information. There can be a logistics issue if perhaps several different owners wanted to see the books at different times, but this is not an issue here. And it's not like I've been banging on their door everyday to see this and that (this was the first time I made such a request). There is no legitimate reason for not letting me make a copy of the information. ​People tend to forget who it is the condo management works for.

Worse comes to worse, if I do not get sufficient cooperation from the committee and management, I will at least be able build a good case out of this episode to encourage other owners to make some changes.

The Bylaws of the condo are under the Condominium act of Thailand, if there is any conflicts the Condominium act takes precedent. For the management, committee, after these entities take over from the developer, the developer has no legal influence whatsoever, unless the developer still own a substantial part of the condominium (voting rights).

When they allow you to see documents in their office, bring a Thai lawyer that is unknown to the management (not friendly).

If the Management and the Committee refuses to give plausible explanations to your worries, you should send from your lawyer a formal complaint by registered mail directly to the committee and management, this will then have to be on the A.G.M agenda.

Assuming the committee and management is dodging the issue for shady reasons, it can be assumed that some action will emerge to correct or cover up the situation. This will then be further evidence in the case. After that it may be prudent to file a formal Police complaint.

Edited July 24, 2015 by AlQaholic

[KittenKong]

When they allow you to see documents in their office, bring a Thai lawyer that is unknown to the management (not friendly).

Very good advice. Nepotism is horrifyingly endemic in Thailand and many people wont hesitate to mislead you to do a favour to someone else.

Never trust anyone's friend in any business transaction. Always try to find people who are completely unknown to the other party. And dont trust them either.