Transfer of Liabilities Between Property Managers

[Angus]

Does anyone know whether new New Zealand property managers become liable for the failings of previous property managers when buying client accounts off them?

My previous property managers recently retired and sold my account to another property management company. When I visited the property later I found damaged drainage that had not been repaired or reported to me. This original damage has resulted in further water damage.

The original managers say that everything was in order when they handed over the property. The new managers deny responsibility, saying that the damage was already done when they took over, and the tenants says that it was storm damage that they reported to the previous manager, who did nothing.

So far none of these parties have provided evidence of their story, meaning that I am expected to pick up the bill.

I am sure that I am not the only landlord in this possibly dangerous position?

[Damap]

As the tenants have verified it as the previous manager's issue I would suggest you're on a hiding to nothing. Just pay it.

[Perry]

Or go to the Disputes Tribunal. I don't think
historical liability is negated by retirement.

[Nick G]

I fired a PM and had to clean up more than $12,000 of mess. It was really disappointing. Didn't file a claim, I just wanted to move on and the new person is amazing.

[Angus]

Thanks Perry, but like I said I have no evidence that my old managers did anything wrong. It is obvious that someone has, but I can not prove who. (To be honest my old managers had an excellent record and I would still like to believe them.) Therefore, as things currently stand Damap would appear to be right.

I do, however feel that I have a moral duty to warn other landlords of this danger so that they can protect themselves against it. For example I could have prevented this by terminating the tenancy and starting afresh, with a full pre-lease inspection including photographs.

Perhaps I should have chosen a more prominent title such as WARNING! WARNING! DO NOT LET YOUR PROPERTY MANAGER SELL YOUR ACCOUNT TO ANOTHER PROPERTY MANAGER.

[Perry]

When I visited the property later I found damaged drainage that had not been repaired or reported to me. This original damage has resulted in further water damage. The original managers say that everything was in order when they handed over the property.

That seems to be one of those he said, she said, they said - situations. One I doubt any of them could prove. And nor can you. Damn!

Your revised perspective seems right. LLs need to be extra vigilant if they are 'sold' to another PM.

[FJW]

Does anyone know whether new New Zealand property managers become liable for the failings of previous property managers when buying client accounts off them?

My previous property managers recently retired and sold my account to another property management company. When I visited the property later I found damaged drainage that had not been repaired or reported to me. This original damage has resulted in further water damage.

The original managers say that everything was in order when they handed over the property. The new managers deny responsibility, saying that the damage was already done when they took over, and the tenants says that it was storm damage that they reported to the previous manager, who did nothing.

So far none of these parties have provided evidence of their story, meaning that I am expected to pick up the bill.

I am sure that I am not the only landlord in this possibly dangerous position?

Hi Angus

Good question, given it appears like its negligence from the previous PM then they are to become accountable for it.

Ask the tenants for any lines of communication that they sent through to the previous PM re the fault then present that to the previous PM. If they don't respond or still try and shift the blame then take it through to the D.T

Hope this helps

[donna]

Did your contract allow the PM to sell your business? Wouldn't a property inspection be done before the handover?

cheers,

donna

[Angus]

Thanks Fraser. It definitely wont hurt to talk to them. Besides, if I go round there more often then I won't get so many nasty surprises. (I should take a greater interest.) I think that I'll leave the tribunal until I have something that I can prove though.



Hi Donna. They asked me to sign a new contract so I did. I didn't think of this sort of danger. Yes a full pre-handover inspection with photographs would have been simple low cost insurance against this. I am surprised that no-one to thought to do of it. Looking back it should be standard protection for all concerned.

[Tan]

Your insurance may cover drainage.