Dismissal

Dismissal - Dismissal is the revocation of a WEG administrator’s appointment by resolution of the owners’ meeting. Since the 2020 WEG reform, the administrator may be dismissed at any time by a simple majority, without the need for good cause. Dismissal terminates the administrative relationship; the administrator’s contract ends no later than six months thereafter.

Legal Basis Since the 2020 WEG Reform

Prior to the reform, the manager could only be dismissed for good cause - such as gross breaches of duty, breach of trust, or lack of expertise. The owners’ association had to prove good cause, which in practice often led to protracted legal disputes.

The Condominium Modernization Act of December 1, 2020, has removed this hurdle. Under Section 26(3) of the WEG (as amended), the property manager may now be dismissed at any time without stating reasons by a simple majority vote of the owners present or represented. The management contract ends no later than six months after the dismissal, regardless of its original term.

Any contractual restriction on dismissal-such as clauses permitting dismissal only for good cause-is invalid. However, the management contract may contain compensation provisions for the remaining term that apply in the event of early dismissal.

The Dismissal Process in Practice

The dismissal is effected by a resolution of the owners’ meeting. The agenda item must be announced in the invitation. The vote is taken by a simple majority of the votes cast. The dismissed manager is obligated to hand over all management documents-financial plans, statements of account, contracts, bank statements, and the collection of resolutions-to the community or the successor manager.

According to Section 24(4) of the German Condominium Act (WEG), the notice period for an extraordinary owners’ meeting is at least two weeks. In cases of particular urgency-such as a serious breach of trust-the notice period may be shortened provided all owners agree or the bylaws permit it. The invitation letter must specifically state the agenda item “Dismissal of the property manager and appointment of a successor property manager.”

The owners’ meeting should, in the same resolution or in a subsequent agenda item, proceed with the appointment of a new property manager to avoid a period without management. A handover protocol listing all documents and keys handed over is strongly recommended.

Obligations of the Dismissed Property Manager to Surrender Documents

The dismissed property manager is obligated to immediately surrender all administrative documents. These include, in particular:

• Collection of resolutions pursuant to Section 24(7) of the German Condominium Act (WEG)
• Documents related to maintenance fee accounts and bank powers of attorney
• Maintenance reserve fund (account transfer)
• Maintenance and insurance contracts
• Keys, access data, and technical documentation

If the dismissed property manager refuses to hand over these items, the homeowners’ association can obtain a court order and enforce the handover through foreclosure. In urgent cases, a preliminary injunction may also be considered.

Practical Tip for Owners in Nuremberg and Franconia

In the Nuremberg metropolitan region, we recommend that homeowners’ associations dissatisfied with their property manager’s performance first seek a discussion and document specific shortcomings in writing-such as delayed annual statements, maintenance measures not carried out, or a lack of transparency regarding the reserve fund. If this does not lead to improvement, an extraordinary owners’ meeting should be convened with the agenda item “dismissal.”

At the same time, it is advisable to begin soliciting quotes from potential replacement property managers to ensure a seamless transition. In Nuremberg and the surrounding area, there are a number of qualified, Chamber of Commerce-certified property management firms whose quotes should be carefully compared. Typical management fees for Nuremberg condominium properties range between 25 and 45 euros per residential unit per month, depending on the size of the property and the scope of services. Have service specifications and reference properties presented to you before signing a new management contract.

Frequently Asked Questions

Can the property manager challenge his dismissal?

The property manager may challenge the dismissal resolution in court within one month if there are formal errors-such as an improperly convened meeting or a violation of the notice requirement. Since the WEG reform, the manager has had little recourse against the substantive decision of the community, as a valid reason is no longer required. Only in cases of obvious abuse of rights-which is extremely rare in practice-could a court declare the dismissal invalid.

Who manages the property after the dismissal?

Until a new manager is appointed, the dismissed manager remains responsible for urgent administrative measures that cannot be postponed-such as ordering emergency repairs or paying ongoing operating costs. Alternatively, the court may appoint an emergency manager at the request of an owner. We strongly recommend clarifying the succession before the dismissal to prevent a vacuum that could jeopardize proper management.

Is the dismissed property manager entitled to compensation?

For the period until the end of the property management contract (up to six months after dismissal), the property manager is generally entitled to the agreed-upon compensation, provided no different provision was made in the contract. However, any income earned elsewhere must be offset against this amount. A damages clause in the management contract that provides for high compensation in the event of dismissal may be unreasonable in individual cases and thus invalid under the law governing standard terms and conditions. In the event of a dispute, we recommend seeking legal advice from an attorney specializing in WEG law.

How do you choose the right successor manager after the dismissal?

The selection of a new property manager should be a structured process: Obtain at least three quotes from IHK-certified property management firms and compare the scope of services, response times, and fees. In the Nuremberg metropolitan area, property management fees for WEG properties range between 25 and 45 euros per residential unit per month, depending on size and location. Ask for references to properties of comparable size and speak with the respective advisory boards there. A good property manager will provide a structured handover report and coordinate the transfer of documents from their predecessor. We are happy to assist homeowners’ associations in Nuremberg and the metropolitan region with selecting a property manager and drafting a practical scope of services.

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