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Know Your Strata Rights

As of June 12, 2015, all of the states in West Malaysia as well as the Federal Territory of Labuan, enforced the Strata Management Act 2013, also known as Act 757 which governs all matters concerning the proper maintenance and management of buildings and common property. Act 757 has since repealed the Building and Common Property (Maintenance and Management) Act 2007, which was the former law on strata management.

For all developers, owners, proprietors, occupiers, tenants, lessees and managers of apartment buildings, Act 757 and the Strata Management (Maintenance and Management) Regulations 2015 subsidiary legislation thereto are essentially the “must know” (sources) when it comes to the legal aspects of management and maintenance of apartments, condominiums, office units and commercial units. In essence, they cover all forms of subdivided buildings.

What is considered “common property” under the Act? A general reading of Section 2 of the Act makes it clear that common property is anything which is not comprised in a parcel or accessory parcel and which is used, or capable of being used or enjoyed by occupiers of two or more parcels.

Thus walkways, lobbies, roads in the development area, amenities such as swimming pool, gymnasium, tennis courts, lifts and lift lobbies all come within this definition of common property.

For commercial properties such as shopping complexes, common property will also include amongst others,  common areas such as entrances, foyers, reception areas and any other area which two or more occupiers or the public can use or enjoy.

Act 757 has taken into account situations whereby strata management is firstly undertaken by the developer for a period of only one month from the date of delivery of vacant possession.

Secondly, whereby the Joint Management Body (JMB) then takes over the management (pre-issuance of strata titles) and finally, where the Management Corporation, or more popularly referred to as the MC takes over the strata management upon issuance of the Strata Titles. For a more comprehensive understanding of the statutory time periods, please refer to the Act, wherein each of the legal entities will take over responsibility of the strata management from the other.

As this article presents only a very superficial look into the Act, it will suffice to say for now, that there has to be a maintenance account and sinking fund account established by the developer which will be passed on to the JMB and finally the MC, at various periods under the Act.  

Under the Act, the JMB and MC will be required to appoint a management committee which should, pursuant to the regulations, comprise at least a Chairman, Secretary and Treasurer.

The developer, JMB or MC, as the case may be, are required under the law to maintain and manage sub-divided land and common property; determine and impose the amount of charges for the maintenance and contribution to sinking fund; effect insurance; prepare and maintain a strata roll; ensure accounts are audited; enforce by-laws and do such other things as are necessary and expedient for the proper maintenance and management of sub-divided buildings and common property.  

It is mandatory under the Act that each of the entities mentioned must convene at the Annual General Meeting (AGM) within a specified period. Attendance at the AGM is important for all owners or occupiers of the parcels as it not only gives one the right to vote for the members who would represent  owners on the Management Committee but also to determine and vote on the fundamental issues concerning the strata management of the properties concerned, as in the amount to be determined for the maintenance charges, etc.

Legally, with rights, also come obligations. One key obligation is the need to pay monthly maintenance charges. Please be reminded that one is only vested with the right to vote if one is not in arrears in terms of maintenance charges and any other dues owing to the JMB or MC as the case may be. Thus, it becomes fundamentally important that one not only pays the charges due but also exercises one’s right to vote as and when the occasion arises as the end effect will determine not only the enjoyment of the common property but also rights and obligations that will be attached to it, be it financially or otherwise.

To truly understand one’s legal rights and obligations, read the salient parts of the Act and the subsidiary legislations thereto. It is not the easiest of Acts to comprehend and seek expert advice including legal advice thereto so it is highly recommended that one ensures full compliance with the Act as there are various penalties and offences attached to such non-compliance.

Apart from this, it is important to know how to administer and manage common properties in accordance with the law and to ensure that the various procedures mentioned therein are adhered to.  

 

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