Apartment Management Company Nightmare in Priory Hall, Donaghamede

Date: October 17th, 2011 | Filed under: Blog, Mediation News | Tags: "Coalport", "Muds", "Multi unit Developments Act 2011", "Priory Hall Donaghamede", "Tom McFeely", Donaghamede, Priory Hall

Just  Imagine today  being a director or member of an apartment management company that has resident firemen on the premises 24/7 as the 187 apartment complex, Priory Hall at Donaghmede in the North side of Dublin is considered a “very serious emergency” and the High Court duly made an evacuation order which was sought by Dublin City Council with a stay on the order until Thursday morning. Unfortunately, for the residents it looks very likely that they will be under strict orders to  vacate their apartments under the direction of the team of security guards and they will have a resident Fire Warden on the premises most likely until the end of January 2012!

How do you move 187 people from their homes in this timescale?

What are their rights? What if you don’t have €2000 or €3000 upfront to pay one month rent in advance and come up with references and at least €1000 deposit to your new landlord and the expense of moving out changing services such as your sky subscription, broadband, your post, and the “general inconvenience”! Something like this would take weeks or months to properly organise depending on your work schedule

So, have some sympathy for the officials in Dublin City Council who now have  to find alternative accommodation for those living at the Priory Hall apartments whilst essential remedial work is carried out and could take over for weeks. The president of the High Court, Mr Justice Kearns heard evidence from a Fire Safety inspector that the external walls would have to be removed from the structure in order to render it safe and hinted that the 187 apartment complex might have to be demolished unless this task was properly carried out immediately

This case should send alarm bells to developers of such complexes and the judge also made an order freezing the assets of the developers company, Coalport which originally developed Priory Hall back in 2006 and also directed that the matter be referred to the DPP !

The High Court did not seem very sympathetic to the developers and stressed that they, not Dublin City Council or the taxpayer should have to pay for this “disaster” which he said the members of this apartment complex were totally blameless and was certainly not impressed that both developers were out of the country yesterday and not impressed with their failure to deal with this problem which had a history.

The developers, Mr McFeely and a Larry McMahony, who claims he should not be joined in these proceedings and that he is himself a bankrupt in England,were  ordered to appear personally before the President of the High Court on Monday 17th October!

However, Mr McFeely under direct cross-examination from the senior counsel from Dublin City Council was reluctant to say how much money he had in the bank to pay for these works to be carried out and after a short adjournment his legal team very clearly told the court that they quite simply do not have money to pay for alternative accommodation or the hotel accommodation that has been hastily organised for the residents at the Regency Airport Hotel on the Swords Road.

Dublin City Council told the judge a number of times that they were simply bringing this application and fire services and they did not have the resources to carry out the remedial work and it also transpired at this hearing on Monday that they did not anticipate that they would have to foot the hotel bills for hundreds of residents of the Priory Hall development for the next five weeks. Their barrister also told the court that it was costing over €42,000 per week to arrange to have a fire tender and a 24-hour shift of four firemen on the premises!

This development appears to have a chequered history and court were told that three fire safety notices were served on this company as far back as September 2009 and whilst a schedule of works was agreed upon to remedy the issues, it was not properly completed and the developers have already been before the District Court where they faced prosecutions and convictions in early 2011.

The first problems arose in the common areas of the complex but the situation became more serious in the early summer of 2011 when Dublin City Council housing department requested fire safety consultants to inspect individual apartments which the Council had bought and it was discovered that any fire which got into any of the external cavity walls could extend very quickly throughout the entire apartment complex without the protection of barriers or controls as the cavity barriers simply did not exist or where wholly unsatisfactory for purpose of fire prevention.

Accordingly, what will now take five weeks in what’s known as phase 1 of the project for the removal of the external leaf brick from the building and this requires the complete evacuation of the building followed later in phase 2 by an upgrading of the fire alarm system and the installation of smoke detectors and replacement doors to some of the units. It was agreed between the parties that in phase 2 a specially trained Fire Warden would maintain a presence in the complex 24 hours a day until the complex can be declared fully fire compliant!

This application arose outside the provisions of the Multiunit Developments Act 2011 and its inevitable that we will see more and more of these applications in the courts. The directors of the apartment management company for this complex “Priory Hall” had to inform their members that the insurance company had decided to cease cover will affect from 13th October following on from a comprehensive survey of the apartment complex and the management company had failed to find other insurers who might be in a position to provide cover for this development!

There is little or no indication from the official records filed in the companies registration office that there is a proper and well-organised management company in place acting on behalf of the interests of the 187 members of some 20 blocks of apartments. The last annual return filed in the companies registration office was made up to the end of August 2010 and published accounts in respect of the year ended 31 December 2009. The principal activity is described as the management of 20 blocks of apartments in Priory Hall, Donaghamede,Dublin13. It’s described as a company limited by guarantee and in that regard it needs the full statutory accounts to be sent to the members each year. Just wonder if each one of these members of 187 apartments have been receiving proper accounts from the directors of the management company.

Since first October, it is a statutory requirement that the developer must transfer over the common areas to the apartment management company. Failure to comply with this new statutory requirement in most circumstances will render the property unmarketable. Who will want to buy an apartment with the common areas still vested with the developer and what if the developer is struck off the register?

What chance has the owner ofapartments3in block 6, Priory Hall,Donaghamede, who has his two bedroomed apartment up for sale with the ReMax office in Santry with an asking price of €199,000. The ad goes on to say that they are delighted to bring this very well presented first floor two-bedroom apartment to the market and point out that the property has solid maple floors throughout! What about the walls that will now have to be torn apart and everybody moved out for a number of months until this essential fire safety work is carried out!

Just doing a quick tot on the property, this development is probably worth over €30 million and who is looking after their property interests!

In this case, the developer is Coalport Building Company Limited and what do you know, the filing in the companies registration office says that this company is strike off listed as it has not filed statutory returns since 2009 and it also says that a receiver has been appointed?

Non-compliant developers better watch out!

Owners and investors of apartment management complexes also need to wake up and smell the roses and better start reading the 34 sections of the Multiunit Developments Act 2011 and check out to see that their common areas have been transferred over to the management company or else they quite simply will not be able to sell their property until their “corporate housekeeping” has been taken care of and this may take years to complete!

There is a lot of fine detail in the new apartment management company law and in particular it is incumbent upon the directors of these management companies to ensure that the developer has complied with what’s known as the Schedules 3 documentation handover. This is a very comprehensive list of 13 major items which is equivalent to handing over the logbook of a Boeing 747 and it contains very useful information on the operating manuals of the electrics, the lifts, the pipe work the structure and all those specialist facilities that are required for the smooth enjoyment of living in an apartment complex with 20 blocks.

The difficulty being that we have over 9000 apartment management companies in Ireland and would an average of three directors per company we will need over 36,000 volunteer company directors who will upskill themselves in the practicalities and the legalities of the Multi Unit Developments Act 2011 and ensure developers are compliant with all the rules and regulations and in particular the structure and the fire safety regulations. Otherwise, apartment residents may find themselves having to relocate to temporary accommodation and local authorities like Dublin City Council may in future may be more hesitant in bringing these type of applications if they know they will need to foot the bill for the bed-and-breakfast, evening meals and expenses of apartment residents.