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A Cost Effective And Expedient Platform For Consumers – Tribunal For Consumer Claims

Strata

SMT undoubtedly reduces Court attendance in matters related to strata management

We all know the old saying that “customers are always right”. A consumer that is unsatisfied with the products or services purchased may wish to take legal redress against the vendor or service provider that may have mistreated the consumer or misrepresented its product or service. However, pursuing the legal remedy through court is a lengthy process and unworthy of the legal cost that may exceed the value of the claim. Hence, the Consumer Protection Act 1999 has provided a cost effective and expedient platform for consumers – Tribunal for Consumer Claims. Similarly, the Housing Development (Control & Licensing) Act 1966 has set up a Tribunal for Homebuyers Claims for the protection of homebuyers in Peninsular Malaysia.

Recognising the need for protection for the various stakeholders in strata development, the Strata Management Act 2013 (“SMA”) established the Strata Management Tribunal (“SMT”) to resolve disputes relating to the management of strata properties. The parties that may file a claim to the SMT are strata property owners, developers, the Joint Management Body, the Management Corporation and managing agents.

SMT’S JURISDICTION

The monetary limit of the claim amount with SMT is RM250,000.00. In other words, the strata stakeholders may file its claim as long as it is within the monetary limit. One may notice that the monetary jurisdiction of SMT is higher as compared to the two tribunals mentioned above, the rationale is that the penalty imposed to any non-compliance of the SMA 2013 is also RM250,000.00.

The subject matter of the jurisdiction of the SMT is summarized below:-

Dispute on failure to perform a function, duty or power imposed by SMA 2013

Dispute on costs or repairs of a defect

Claim for the recovery of charges, contribution to the sinking fund or any debt

Claim for an order to convene a general meeting, invalidate proceedings of a meeting, nullify a resolution on matters decided in the general meeting

Claim to compel for supplying information or documents

Claim for an order to give consent to effect alterations to common property or limited common property

Claim for an order to affirm, vary or revoke the authority’s decision

However, it shall be noted that the SMT shall not have jurisdiction over disputes relating to the title, estate or interest in a land.

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NO LAWYER DURING THE HEARINGS

The general rule is that neither party is allowed to appoint a lawyer to represent them at a hearing. Nonetheless, the law also allows an exception – where the matter in question involves complex issues of law and one party will suffer severe financial hardship if he is not legally represented.

RULES AND PROCEDURE

The SMT may conduct the proceedings in such manner as it considers appropriate, necessary or expedient for the purpose of ascertaining the facts or law and determination of a claim.
A summary of the powers of the SMT in conducting proceedings includes: –

To determine the manner to conduct the proceedings

To determine the manner of discovery and providing of the evidence

To draw on its own knowledge and expertise

To order the giving of security for costs from the first date of the hearing commences. Reasons to reach its award shall also be given in all proceedings.

An award by the SMT is as good as a Court order, thus whoever fails to comply will be committing an offence. Upon conviction, that person will be liable to a fine not exceeding RM250,000.00 or to imprisonment for a term not exceeding 3 years or to both. In the case of a continuing offence, meaning the failure to comply continues to linger for days, a further fine not exceeding RM5,000.00 will be imposed for every day or part thereof during which the offence continues after conviction.

A Tribunal may make the order and the party will need to be bound by the order made. The Strata Management Tribunal may order a party to the proceeding to: –

Pay or refund a sum of money or compensation or damages to another party

Varies or set aside of a contract or additional by-laws

Pay interest on monetary award at a rate not exceeding 8% per annum

Dismiss a claim which it considers to be frivolous or vexatious

Any other order as it deems just and expedient and

Ancillary or consequential orders or relief as may be necessary to give effect to any other order made by the Tribunal

CONCLUSION

As the SMA 2013 has just been implemented for 3 months and the SMT being newly established, the effectiveness of the SMT is still being tested. Nonetheless, the establishment of the SMT undoubtedly reduces court attendance in matters related to strata management. On the other hand, the popularity and the current trend to buy into a strata development signifies a higher chance of strata management disputes, thus the establishment of the SMT is right on time to deal with the dispute that may arise and serve as a platform for a consistent strata dispute resolution.

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