The Institute of Real Estate Management (IREM), its CERTIFIED PROPERTY MANAGERS (CPM) Members and Ac-CREDITED MANAGEMENT ORGA-NIZATION (AMO) Firms justifiably take great pride in their contract drafting skills, precision with words and overall documentation preparation and management. Both the CPM Code of Ethics (Article 6) and the AMO Code (Article 2) highlight and reinforce the critical importance of establishing your scope of authority, duties and responsibilities, documenting these precisely and then managing prudently and skillfully within the parameters of the management and related service contracts.
As per Article 2 of the AMO Code--at all times, and without exception--the CPM Member and the AMO Firm must adhere to all regulatory guidelines and contractual obligations. They have a fiduciary duty to adhere to, and work towards, the client's objectives and company policies. All contracts must be carefully crafted and followed precisely. The only acceptable variances to contractual duties are those which are due to legal or regulatory changes, and those which have been discussed and approved by clients beforehand. By design, there are no gray areas to AMO Article 2--nor should there be when skilled and conscientious members IREM are preparing contracts and working with likeminded clients.
To ensure contractual compliance, and to manage effectively and efficiently manage outcomes for your client--and by extension, your Firm--take time to think about, draft and refine your management and service contracts. The final contract must be a definite reflection of the client's objectives, the company policies and objectives. Every word and section must have a precise meaning and purpose; with no room for misinterpretation or assumptions.
In turn, your contract and fee schedule should be commensurate with your education, experience and expertise. Negotiate all contracts firmly and fairly; your client will respect this and you all will be grateful that the time invested in these contract negotiations has prevented costly misunderstandings and disappointments in the future.
Finally, remember that all negotiations and the final contract documentation should be structured around the three Cs: Be Concise; show Clarity; and reflect Conviction. Before you sign off on your contracts, make sure they capture mutual goals and comply with the CPM and AMO Codes.
"An AMO Firm shall perform its contractual duties and maintain company, property, and client records in accordance withal applicable regulatory guidelines, contractual obligations, client objectives and company policies. It shall not act beyond its contractual scope of authority as an agent without documented client approval."
-AMO CODE, ARTICLE 2
WILLIAM MCCARTHY, CPM (WPJM@WPJMCCARTHY.COM) IS PRESIDENT OF W.P.J. MCCARTHY AND COMPANY LTD. IN BURNABY, B.C.
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|Title Annotation:||Know Your Code; code of ethics|
|Publication:||Journal of Property Management|
|Date:||May 1, 2012|
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