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Thinking of standing as a committee member at your condo?

Know your obligations and potential liabilities... frist!

  Boat Lagoon

Each and every year condominium juristic person managers send out a “Notice of Annual Meeting of the Joint Owners” to all owners of condominium units in any particular registered condominium in Thailand. Inside that notice, should be included an agenda if the manager is following the law, which specifies the items under which all of the joint owners who attend the meeting in person or by proxy will vote on the appointed day of the meeting.

Usually, one item to be voted on is the appointment of specified owners (or their spouses or statutory heirs) to represent all co-owners on the condominium juristic person joint owners committee. Every year condominium unit put forth their names to stand for the condominium committee, and every year new committee members are elected to the myriad registered condominiums across Thailand, without actually knowing what it means to be a committee member, legally, or what duties of care a committee member might have to the condominium juristic or the other joint owners.

Having worked with dozens of registered condominium juristics in Thailand, acting at times for individual or groups of joint owners, and at other times for the condominium juristic or the manager itself, we are well aware that there are owners who put forth their names to stand as a committee member with specific agendas, usually that agenda is to seek change of policy for the common good, but other times can appear to be for more suspect reasons such as personal gain or benefit.

We don’t make any attempt to act as the arbiter of appointments in the condominium juristics in which we are actively involved, or otherwise pass judgement on whether the reason someone is standing is for a common good or for self-benefit. We do however advise committee members and juristics their obligations and duties under law, irrespective of the reasons people stand for the position.

It is no secret at condos that all joint owners can lawfully stand for membership on the committee whilst they remain a joint owner, unless barred from membership due to some rule or legal violation (such as failure to pay the common area management fees).

Owners elected to a committee typically are appointed for two-year terms according to the Condominium Act of Thailand (“Condo Act”), and can only be removed, once appointed by resolution, by certain means – including conviction of crime, serious debt to the condominium juristic, becoming incapacitated or by means of a removal vote by subsequent meeting convened by the joint owners with an agenda item to remove a committee member.

However, knowing that one has the right to stand for the committee, or even that one can be removed by a vote, does not mean that one knows the obligations and duties of a condominium juristic committee member.

Under the Condo Act, and generally included in all Rules and Regulations of a registered condominium juristic, committee members have the obligation, as a group of elected members, to attend to the following basic matters:

  1. Monitoring control over the condominium corporate management;
  2. Appointing a member to assume the duties of manager of the condominium juristic in the case where there is no manager or the manager is unable to perform normal duties in excess of 7 days;
  3. Arranging the board meetings to be convened at least once every six months; and
  4. Other duties prescribed by law.

Upon consideration of the enumerated list above, the duties could reasonably be interpreted broadly enough to encompass typical board legal duties, in a similar manner to the duties of care a board member of a company might have.

But does this expansive ‘corporate management’ duty requirement mean that condominium committee members can be held personally liable for actions they take in their position as a committee member that might cause damage to the common area or another owner’s interests, or even the manager?

This is a very tricky and undeveloped area of the statutory law, and unfortunately the Condo Act does not give specific guidelines as to the extent of a committee member’s liability.

It is therefore reasonable to presume that committee members could be held responsible for reckless actions that cause damage to the condominium or the joint owners and that they have a duty of care to act in the best interest of the joint owners under general principles of law.

Indeed, Thai law generally provides compensation to an injured party for any negligent or reckless actions that causes damage to property, life or the well-being of that person. No doubt this could include negligent, reckless or intentional actions that cause a condominium juristic person to cause damage to third parties or joint owners, including putting the condominium in breach of any of its obligations to joint owners. Accordingly, until the legislature more clearly defines the extent of potential liability of a committee member, such members are encouraged to consider the existing contracts and rights and obligations of the condominium juristic person once they are appointed as a committee member.

In addition to other protective measures, we generally recommend terms of reference are drafted and approved by joint owners to be provided to all owners and then presented for signature by any new member appointed to the committee of a condominium juristic person.

 


By Robert Krupica, Senior Partner of Hughes Krupica.
Hughes Krupica is a law firm which specialises in Real Estate; Construction; Hospitality; Corporate; Commercial; Personal Injury; Dispute Resolution; and Litigation, operating in Bangkok and Phuket, servicing clients in relation to their business activities in Thailand and in other regions of Asia.

 Contact info:

Hughes Krupica Consulting (Bangkok) Co. Ltd

Phuket Office:
23/123-5 Moo 2, Kohkaew Plaza, 
The Phuket Boat Lagoon, Tambon Kohkaew, Amphoe Muang, Phuket 83000
Tel:+66 76 608 468 

Bangkok Office:
179 Bangkok City Tower, Fifth Floor,
South Sathorn Rd, Sathorn, Bangkok 10120
Tel: +66 2 872 173

[email protected]
www.hugheskrupica.com

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