Management Corporation vs High Rise Residents

Management Corporation vs High Rise Residents
Condo owners versus management firms
By K.W. MAK
kwmak@thestar.com.my

Condominiums are a statement of luxury, but behind the facade, residents complain of the lack of services from their management companies (MCs) while MCs complain that the residents who refuse to pay management fees are the ones preventing such services from being provided.

This “chicken and egg” scenario is causing a lot of dissent among condominium property owners, so much so that a group of such affected owners decided to form the Condominium, Apartment and High-rise Committee (CAHC) to champion the rights of condominium owners.
There are no quick fixes to the problems, however, as residents who got together to fight their issues discover numerous hurdles and obstacles before them.

“There is a lack of transparency in the way things are done presently and residents are tired of being taken for a ride,” said CAHC pro tem chairman Tengku Nazaruddin Zainuddin.

Arguments between residents and MCs are often the result of money matters. Residents are already paying a premium on their service charges and when such services are not up to expectations, complaints would ensue.

Most MCs do not make the matter any easier to resolve because they do not allow the management accounts and the sinking fund accounts to be viewed, citing excuses that the accounts could not be shown.

“Don’t let them cheat you. Withholding such accounts from residents is a violation of the Housing and Development (Control and Licensing) Act 1966 that many MCs and condominium owners themselves are not aware of,” said CAHC pro tem assistant chairman Khong Chee Seng.

Section 19 of the Act states that the developer shall provide the purchaser with a copy of the Annual Audited Accounts for the expenses incurred for the provision of the said services.

Section 20 (sub-clauses 3 and 4) meanwhile provides for the Sinking Fund accounts to be made available to the purchaser.

CAHC through the residents associations has used this Act to apply for the accounts from two MCs of condominiums located in Petaling Jaya and Klang. However, they have yet to provide a copy to owners.

Part of the reason MCs do not want to disclose their accounts is the fact that some of them charge management fees illegally.

Prior to the acquisition of the strata title, the developer is either supposed to manage the condominium or outsource the management to another person or corporation.

“Any person who undertakes property management practice is required by law to register with the Board of Valuers, Appraisers and Estate Agents,” said Board of Valuers, Appraisers and Estate Agents registrar R. Mahaletchumi in reply to a query on management fee charges.

“Nevertheless, if the condominium concerned has not been issued with strata titles, then the developer may manage the condo himself, provided he does not charge property management fees.”

The right to charge such fees lies with those registered with the Board, as stated in Section 21 of the Valuers, Appraisers and Estate Agents Act 1981.

Developers who outsource the management to a third party must ensure that the person or company is registered with the Board.

Monday January 8, 2007

Strong-armed tactics used to bully residents

Condominium, Apartment and High-rise Committee (CAHC) pro tem assistant chairman Khong Chee Seng said there are many stories of management committees (MCs) using strong-armed tactics to bully residents into paying up the management fees.

One of the tactics employed is the clamping of water meters – a penalty which some MCs have included in the in-house rules and regulations for not paying management fees.

What many MCs do not take into account, however, is that Section 35 of the Strata Title Act 1985 specifically states that condo residents have the right to support, service and shelter, which includes access to water, and that any attempt to clamp water meters is in violation of the Act.

CAHC is trying to get around this deadlock by getting the Selangor state government to legislate a law forcing MCs to hand over the water meters to Syarikat Bekalan Air Selangor (Syabas).

Syabas is willing to let condominium dwellers pay domestic rates, but they must first control the meters, and they cannot take control of it presently due to the ambiguity in the law on water meters governing joint-ownership properties like condominiums.

Syabas has already submitted the proposal to the state government and it would take some three months for the state government to implement, if it agrees to such a suggestion.

Other tactics include lawyers’ letters with threats of lawsuits.

Khong himself has been slapped with several lawsuits amounting to RM5mil for fighting on behalf of condominium residents.

But residents are not the only victims here. Bungah Raya Management Corporation secretary Somasundaram Venkates-waran said from his experience, MCs use water clamping to enforce payment of arrears by defaulters.

“Though this is certainly not a fair thing to do (access to drinking water is a basic human right), it has been found to be a practical, cost-effective and quick recovery method,” said Venkateswaran.

“Legal recovery procedures are expensive and time-consuming. MCs may have to wait a long time to obtain judgment from our courts, all the more so with our appellate courts system.

“In the meantime, core services including corridor and car park lighting and lift operations have to be disrupted or even stopped altogether due to the lack of collections from owners. This will obviously anger owners who are good paymasters who may also stop payment until services are restored. It is a ‘chicken and egg’ situation.”

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28 January 2007 - 7:12am — Guest
Management Corporation vs High Rise Residents
INDIVIDUAL METERS vs BULK METERS

Schedule H of the Housing Act stipulated

19. Water, electricity, gas piping, telephone trunking stipulated:

(2) The Purchaser shall be liable for and shall pay, within fourteen (14) days after the receipt of a notice requesting for payment from the Vendor, the deposits for the installation of water, electricity and gas meters and the Vendor shall bear all other costs, if any.

22. Time for handing over vacant possession.

(1) Vacant possession of the said Parcel to which water and electricity supply are ready for connection shall be handed over to the Purchaser within thirty-six (36) calendar months from the date of this Agreement.

By virtue of this, all Purchasers are entitled to have individual meters and in fact had paid deposits to the Developer so as to enable Developer = Vendor to apply the water supply to proceed with the application of CF for the vacant possession. Therefore, the deposit of any Bulk meters should have came from these Deposit which was usually higher than what was deposited by the Developer to PUAS.

Therefore, what Syabas considered the law is ambiguous is unfounded. Or, how come there are individual meters for electricity under the same section?.Pushing again the responsibility for individual to deal with the matter is a very irresponsible. Will they serve better if they do not realize the responsibility NOW?

The statement:

"Syabas is willing to let condominium dwellers pay domestic rates, but they must first control the meters, and they cannot take control of it presently due to the ambiguity in the law on water meters governing joint-ownership properties like condominiums."

Posted the following QUERY:

1. Are all Deposits for Bulk Meter been or will be accounted for Transfer from PUAS to Syabas?

2. How should these Deposit be transferred to the Individual? And, what about the differences, if any?

3. Is the Statement post a condition that only new meter be installed that the Domestic Rate will be applied?

4. So, a new Deposit and a new installation Charge?

According to http://www.monitoringglobalisation.org/index.php?option=com_content&task...

there are 420,000 units under 2,200 registered Bulk Meters. With an average of 300/unit, a new Deposit of 1.62 billion will be collected, besides possible new installation Charge. Will approved meters not be used as reported (somehere)?

Therefore, unless the old deposits are transferred or settled with Individual owners, the move of having individual meters is only contributing another nuisance.

Technically, it will also posed problem when there are Filtering system between the Bulk Meter and the Individual meters.

CONDO RATE

Most Condo are required to have water pump after the Bulk Meter and a water Tank to ensure pressure of water supply to the Condo. Therefore, there is no reason of higher price than domestic. Besides, there are less piping to be used than landed properties as the Units of the Condo are more centralized

CAHC

When there should be 2,200 bulk meters, apparently, the number CAHC are representing is still a minority. Therefore, in order to avoid CAHC from being accused of manipulating the discussion, I hope CAHC committee will posted what they want to discuss with Saybas for comment before discussion (could it be done on http://www.monitoringglobalisation.org/ ?) and report what had been discussed during the meeting with Saybas. Otherwise, the discussion could solve some problems but causing other loopholes.

Meanwhile, I SALUTE THE WORK OF CAHC FOR THEIR CONTRIBUTIONS AND HOPE THE ABOVE CAN BE ATTENDED BEFORE ANY SOLID PROPOSAL to be voted by the public. I hope CAHC will provide more LEGAL GROUND FOR OUR UNDERSTANDING OF RIGHTS FOR THE ISSUES.