Custodian of the Keys

At university, a friend of mine, Josh, was notorious for losing things, particularly his keys (and also, memorably, the phone number of a particular young lady named Sue, who he affectionately referred to as his future ex-wife). He regularly missed crucial opportunities and significant life events because of his inability to keep track of his most important personal possessions. It eventually transpired that he suffered from acute somnambulism (sleepwalking) and had been hiding things from himself for most of his life. He never forgave himself.

Josh would not have been a good building manager. An often overlooked, but vital, role of a building manager is to be the custodian of the master keys for the building. A master key is capable of unlocking every lock in the building (including the front doors to every apartment). So, as much as it relieves the building manager from the inconvenience of clanking around the building with more keys than a grand piano, it carries with it significant responsibility.

The locks and keys forming part of a master key system are body corporate assets, which are owned and administered by the body corporate. Of course, keys take all different forms these days and range from traditional metal keys to fobs, swipe cards, key pads and, if your sinking fund allows, voice recognition and biometric retinal scans (but let’s keep things simple for the purpose of this short article). All keys forming part of a master key system are recorded in the locksmith’s register for the building. The locksmith can only create new keys with the authority of the body corporate (that authority cannot be delegated to the building manager).

In practice, it makes sense for a building manager to control the use of the master keys at the building. Usually, the caretaking agreement between the building manager and the body corporate includes specific provisions entitling the building manager to use the keys and requiring the building manager to keep safe possession of them. Whether or not that is the case, the building manager will ultimately be responsible for ensuring any key it holds on behalf of the body corporate is kept safely and used appropriately.

When a building manager sells its business, the body corporate should ensure all master keys are accounted for prior to settlement. If master keys are missing, the security of the building (and every apartment) is at risk.

Missing master keys and poor administration of master key systems by building managers are surprisingly common. When we seek a reconciliation of the master keys held by the building manager as part of the body corporate’s assignment process, the usual response is… crickets. Often the building manager has never previously obtained the key register from the locksmith and has no idea how many keys they should have.

Ultimately, the building manager will be liable for any loss and damage resulting from its failure to keep safe possession of the body corporate’s master keys. One of our body corporate clients recently required the outgoing building manager to replace the master key system in the building (at a cost of more than $50,000), as a consequence of the building manager losing multiple master keys and compromising the security of the building.

It is good practice for a building manager to:

1. obtain the building’s key register from the locksmith
2. limit the use of master keys by others
3. keep a log of keys and require contractors to sign-in when they receive a key and sign-out when they return a key
4. report any missing master keys immediately
5. keep master keys locked in a safe when not in use
6. conduct regular audits and report them to the committee
7. obtain committee approval before instructing the locksmith to cut a new master key

Some years after his diagnosis, when Josh was moving out of his St Lucia apartment, he found a collection of keys, credit cards and assorted memorabilia, including Sue’s faded phone number, on top of his wardrobe. He rang the number and spoke to Sue. She was married (to the lecturer of our Constitutional Law class). Josh blames himself.

Don’t Josh yourself – safeguarding the master keys is a big responsibility but an easy one to fulfil with the right systems in place.

If you’d like to know more about the rights and obligations of the parties in relation to building security (or about what Josh was wearing on the evening he sleepwalked to the neighbour’s house), contact Andrew Suttie.