The Multi Unit Developments Act, 2011 was enacted on 24January 2011 and came into operation on 1 April 2011 following aCommencement Order for the remaining sections of the Act which did nothave immediate effect. Certain regulations implementing detailedprovisions of the Act have also been made.

The Act provides astatutory framework for multi-unit developments (be they mixed use orresidential only) containing at least 5 residential units with sharedamenities, facilities and services. Provisions which are of particular note are:

• Timely Transfer of Common Areas
  The Act contains provisions relating to the timely transfer of common areas of multi unit developments to the owners’ management company which is made up of unit owners in the development (the “Management Company”). Such a transfer is required to take place prior to sale of the first residential unit in the case of new multi unit developments (i.e. a development in which a residential unit has not previously been sold) and by 30 September 2011 in the case of existing developments (i.e. a development in which a residential unit has already been sold.)

• Other conditions on sale of units in new multi unit developments
  The Act contains provisions requiring a contract between the Developer and the Management Company outlining their respective obligations including statutory requirements, completion of common areas, retention monies and dispute resolution to be entered into. Both the owner of the development and the Management Company are required to have separate legal advice, the costs of which the owner of the development is to bear. 

• Management and Operation of Company
  The Act deals with the management of the common areas by the Management Company and the internal governance and operation of such company. For example, there are provisions for service charge including a requirement to establish a sinking fund by the later of the date which is 3 years from the date of transfer of the first unit in the development and 30 September 2012 where no such fund has already been established.

• Provision of Documentation to Management Company
  The Act provides for the supply to the Management Company by the Developer of specific documents to include Opinions on Compliance with Planning Permission and Building Regulations.

Certain provisions of the Act are applicable to smaller developmentscontaining two or more residential units but less than 5 and todevelopments consisting solely of houses with an owners’ managementcompany structure.

Contributed by Tara Rush, Andrew Muckian.