Management Contract Ammendments

I am on the board of an association with over 400 condos. Recently, I requested a copy of the management contract because we are unhappy with our current company. The contract has not been renewed since 2005. We have been month to month. In the contract, it states that there shall be no ammendments unless both parties agree and sign an ammendment. In our contract, the management fee is $5500 per month and postage, envelopes, copies, etc for all correspondence are included in this fee. We are being charged $6900 per month and $1500 each month for postage on the monthly ledger.

I emailed our management company and asked if there are any signed ammendments. Our management company stated that it was agreed to in a board meeting (around 3 or 4 years ago) that the fee would increase and it was put in the minutes. Would this be considered an official ammendment? It seems strange that it wasn't done formally.

Is it unreasonable for me to assume that the mgmt company should have included all ammendments when they provided me with a copy of the original contract? Or at least a copy of the minutes showing the rate increase?

I'm uneasy about the management company thinking the minutes are as sufficient as a signed ammendment. I'm still waiting for a copy of the minutes. Any feedback or suggestions?

In this case, if it was approved and in the minutes, shouldn't a new contract be drawn because the other is invalid?

I'm glad you took the time and looked into the actual contract.

Remember that technically a handshake is a contract if there was a meeting of the minds. Therefore, as long as the agreement was documented, and the minutes are the official record of the Association, then the terms were changed.

Yes, I agree that the MC should have included a copy of the minutes on that change when you requested a copy. Question, who keeps those records, the Board or the management company? Personally, I think that the Board should hold and maintain all official records like this and not the MC. Similar to a disgruntled employee, if you have a disgruntled MC, the Association can end up losing a lot of items.

Have you gotten a copy of those minutes yet? You might want to contact past board members and see if they remember anything. I suspect that the change is legitimate, otherwise, your past treasurers would have been screaming at the increase on the first bill.

Tim

Whatever the fees are..... its time you put the contract out to bid again. Now.

Let them compete with other management companies and submit a bid. Only then will you get a better idea of what fair market value cost should be for their services.

My suggestion: Put them on notice that you are considering putting the MC job up for bidding. You would like to consider them in the process and would like for them to submit a bid. You also would like to know what services they are providing now and when their contract ends.

Follow through with seeking bids from other sources. You may surprise yourself at what you have or you may find something new.