CityLiving: Apartment owners can gain control of their complexes to set service charges. Edel Morgan reports

The story of how Arran Quay apartment complex in Dublin's inner city turned itself around - from a development where residents had no access to the development's annual accounts to one in charge of its own destiny - may serve as an inspiration to other developments.

Dara Beggan, a resident of Arran Quay, gets impatient when he hears residents of other developments complain that a management agent is squandering funds collected from the annual service charge. He believes residents need to take control of their development's financial affairs and monitor every cent being spent by the agent.

The problem is finding people who are willing to take on that kind of responsibility. Being on the board of directors is time consuming, means having to get to grips with company law, be financially astute and accept the Trojan responsibility of running a complex with no support or remuneration. The board also needs the confidence to exercise its power to the full.

The residents of Arran Quay needed plenty of confidence when they staged "a coup" in 2003 and elected their own board of directors. The developer of the 1990s-built complex has yet to hand over the 247-unit complex to residents.

"We wrote to every member and to the existing directors, who included the developer, about the meeting. None of the directors turned up and we appointed our own chairman. We elected a new board of directors and changed the registered office to the new secretary's apartment." The former directors, who included the developer, hadn't invited members to any previous AGM, says Beggan.

The management company is entitled to act as the owner - even though the development hasn't been handed over yet - which gives them control of the cheque book. It means the management agent can't issue cheques without the signature of a director.

Prior to the takeover, the resident's committee had already gained significant control. Until 2001, they had no access to the annual accounts. If they hired a contractor, the agent would send a cheque on their behalf. This situation ended when they fired the agent.

More than two years on and the board of Arran Quay is running a tight ship. "We now have the confidence to realise if the garden is not done right, we can fire the gardener and, if the management agent isn't doing a good job, we can get rid of them but it's not feasible to expect the agent to get value for the residents, the board has to do that itself."

Of 246 members, 27 have given their time to the residents committee over the years. "It's always the same people but that happens in every walk of life." He believes very few people who buy an apartment are aware of the full implications. "I think less people would buy them if they were aware of the responsibility. I can imagine there are developments where no one wants to get involved in the running of the development. I saw an RTÉ report on apartments in Poland where it referred to the weird arrangement there where owners have a share of the building but that's exactly what we have here. We (the board of directors) are the landlords of the house. If there's a leak in an apartment and the owner won't let us in, we can force entry if we have to, although that hasn't happened yet. We can get a plumber to fix it and then bill the owner. In our building if something happens to your apartment you claim the contents off your own insurance but the fixtures and fittings, down to the toilet bowl and the shower, is off our insurance."

The management company is quite aggressive in its collection of the service charge with regular letters fired out to debtors. A computer system shows a detailed profile of these debtors and serious offenders face hefty interest payments or legal action for non-payment. Residents receive a detailed copy of the audited accounts. "It's completely transparent. It shows the reason for the 8 per cent increase in the service charge, including a new intercom system and additional gardening and lifts maintenance costs. Every year we put €90,000 aside for big jobs down the line, like painting and carpets. There was also a levy on top of this for the fire detection and prevention system." This meant the charge and levy for a standard one-bed was around €1,800.

"I'm a great believer if you explain properly, people will understand and no one has complained about the service charge yet."