Strata living – a tale of two cities

18 October 2014 By: CHRIS TAN . . . REAL LEGAL

“IT was the best of times, it was the worst of times…

We had everything before us, we had nothing before us,

We were all going direct to heaven, we were all going direct the other way…”

The famous opening line in A Tale of Two Cities by Charles Dickens presents to us the tension and opposing attitudes borne between the inhabitants of the two cities. This disparity reflects our perception of “Strata Living” – a form of progressive yet regulated community living made possible by its inhabitants within its gated guarded boundary.

Strata is a legal concept that has been around officially for almost three decades in Peninsular Malaysia since the introduction of the Strata Title Act in the 80s and has never cease to expand its roots till to-date. As a working concept, it stretches further back to history under the subsidiary title under the National Land Code. Official statistics from the Housing Ministry in late-2012 shows that one out of four stays in a strata development in Peninsular Malaysia. In response to such pressured demands, the yet to be enforced Strata Title (Amendment) Act 2013 (STAA) and Strata Management Act 2013 were passed in parliament to better serve such needs.

Strata living often relates to the affordability and buying power. The common presumption is the less fortunate gets a piece of “air space” made possible by construction technology. Nonetheless, parallel to the scenario in the Dickens fiction, there may exist a twin (a Siamese genre for this instance) with overlapping similarities while simultaneously distinguishable by the underlying motivation akin to the two sides of the same coin.

The reality of strata living has come about due to the scarcity of land in areas where infrastructures are concentrated and increasing land cost. Over the years, the Government has been trying to improve house ownership through the introduction of affordable houses, with the most recent example being PR1MA. The basis of strata living is self-management and self-sufficiency.

In other words, once developers have done their part, they wipe their hands clean of any further obligations save for any latent defects or negligence. This form of strata living is seen as affordable. The negative part is you have small plots of land with residential units densely packed together; a suffocating and uncomfortable setting to raise a family.       
So is the tale of one city – a grey and morbidly dense city.

Yet, by a flip of the same coin, the concept of strata living need not be restrictive. It is not confined to vertical multi-level structures but also horizontal living – gated, guarded and landed communities. This type of strata living is naturally more expensive and caters to the higher income group – lavish strata living with lesser restraint on space, practically the area of an entire building with landscaping. Imagine the typical Western upper-class neighbourhood – the lack of fencing between the houses within the gated boundary creates opportunities for connection and interaction. Children are able to roam freely and safely within the gated boundary.

With the soon to be effective STAA 2013, the exclusivity in strata living lifestyle is expected to increase. By virtue of the Act, the management corporation (MC) has the discretion to designate limited common property areas for the exclusive enjoyment of a particular group of parcel owners. In other words, there will be more diversity in strata living moving forward.

With such an enactment, one can only envision the inevitable formation of the MC that is akin to that of a resident’s committee in Singapore. Moving-in resident, owner or tenant, is required to undergo MC screening, which resembles a school admission interview and will be categorised based on social status, income levels etc.

Moving up a notch, one can envisage the setting up of a property management fund contributed by the owners and managed by professional fund managers to ensure a handsome return to the MC for long-term sustainability in maintaining the desired lifestyle of the strata community. Simultaneously, without much restraint financially, outsourcing such maintenance work to a professional management group is made possible.

Such is the tale of another city – a desired city of hopes and possibilities. There are both strata projects, but so vastly different.

From the above, one city simply does not reflect the other. While the idea of chipping into strata living is involuntary at large, there are pros in strata living that warrant the higher income group to choose and favour strata living.

Bundling with the improvement of the strata regime that caters to the wants of this higher income group, strata living is the way forward for Malaysia in our path to a developed nation.

Chris Tan is the founder and managing partner of Chur Associates

- StarBizWeek

22 September 2014

Bekalan Air Ke Dalam Bayu Villa Telah Di Potong.

Bekalan air telah di potong oleh Syabas pada tengah hari tadi. Jam 12.30 tengah hari. Sebelum pemotongan dilakukan Pengerusi Cik Sharmini ada menalifon pegawai Syabas Encik Ahmad Nita berkenaan pembayaran yang akan dilakukan iaitu sebanyak RM10,000.00 pada hari Rabu yang akan datang hasil daripada kutipan wang penyelenggaran yang didapati semasa mengadakan Mesyuarat Agung Luarbiasa.

Tetapi pihak Syabas enggan menerima RM10,000.00 dan mendengar segala apa jua alasan mengenai perkara ini. Pihak Syabas juga menjelaskan bahawa mereka tidak akan memotong air jika JMB Bayu Villa berupaya menjelaskan tunggakan sebanyak RM100,000.00 ke atas.

 

- BayuVillaApartment.blogspot.com

New beginning in strata management

December 16, 2012

New beginning in strata management

Comment
By Roger Tan

Act for peace: An effective and efficient dispute resolution mechanism will help promote peace and good neighbourliness in stratified buildings.

With more and more people living in stratified buildings, the new Strata Management Act is timely in helping to reduce animosity among residents and owners during dispute resolutions.

LAST Sunday, I attended the annual general meeting (AGM) of the management corporation of an upmarket condominium as a proxy for my wife. Its last AGM was held in September last year.

This AGM was by far the most heated and disorderly since the management corporation was set up some six years ago. A fight almost broke out despite the presence of representatives of the Commissioner of Buildings (COB) and the police.

Let me now share with you my personal thoughts about the AGM, before examining whether the new Strata Management Act (SMA), when it comes into force, will help minimise and remove such animosity which appears to be rather prevalent and common among occupants living and undertaking business in stratified buildings.

In fact, trouble was already brewing before the AGM. In the AGM notice sent to owners of all the 170 parcel units, all the three outgoing 2011/2012 Council (CM2012) members – in their 30s (let’s call him CM1), 60s (CM2) and 70s (CM3) – jointly signed and attached a three-page letter containing allegations of impropriety against the previous Council (CM2011) members.

The CM2011 members, through their lawyers, demanded that their written explanatory response also be circulated to all the parcel owners before the AGM. This was refused.

Drama-charged

The situation was aggravated when CM2, the outgoing CM2012 chairman, used his welcoming speech, delivered in Mandarin, to reply to CM2011 members’ written explanatory response, which was also not circulated during the AGM. He also attempted to make more allegations of impropriety against CM2011 members until I intervened because the latter had not first been given any opportunity to be heard. Procedurally also, this should not have been done before first electing the chairman of the AGM.

I also observed that each time someone spoke up against any resolution proposed by CM2012, CM3 would shout and try to interrupt and intimidate the speaker. A fight almost ensued when some parcel owners confronted CM1 and CM3 during the break. They wanted to know why their parcel unit numbers had been displayed on the notice board as not having settled a one-time payment of RM400 for upgrading work, approved in the 2010 AGM. The parcel owners felt aggrieved that they had been publicly shamed, claiming and showing proof that at the time the notice was put up, CM1, CM2 and CM3 as Council members themselves had failed to pay maintenance charges for a few months, but their parcel unit numbers were not mentioned in the said notice. CM3 then raised his walking stick cum foldable chair, wanting to strike his fellow septuagenarian CM2011 member who questioned him until he was restrained by police and the former’s wife.

(Interestingly, I was informed by the COB that a fight virtually broke out before him during the extraordinary general meeting of a nearby condominium on Oct 28 when chairs were also thrown! Fortunately, goodwill prevailed when the injured decided not to press any criminal charges.)

The AGM then proceeded with election of 2012/2013 Council members. The House decided to elect only seven Council members. Eight owners were nominated. When the COB suggested that voting could be dispensed with if the House decided to change the number to eight, CM2 strenuously objected. CM2 vociferously proclaimed that he could not accept the CM2011 Chairman into the new Council. When one of the eight said he would withdraw so that the number could be reduced to seven, CM2 objected too because that would mean CM2011 Chairman would get elected. It was obvious to everyone present that there is a lot of bad blood between CM2 and CM2011 Chairman. Then almost half of those present who are owners living in the condominium walked out in protest.

Nevertheless CM1, CM2 and CM3 were elected even though it was obvious that they did not enjoy any support from the live-in owners. Their support came, instead, from the proxies. Twelve proxies who were present actually represented owners of 48 parcel units. CM1, CM2 and an estate agent who is also an owner (EA), were also each a proxy to several parcel unit owners. It was abundantly clear that these proxies were mainly CM2’s friends.

When challenged whether these proxies knew who the principals/owners they were representing, the mainly Mandarin-speaking group just remained silent. But CM2 openly instructed them on how to vote and they voted according to his instructions. If voting had been done by show of hands, CM1, CM2 and CM3 could have lost, but it was done by poll where the proxies’ votes are calculated according to all their principals’/owners’ shares of the parcel units.

In fact, this expressly went against the COB’s circular that a person can be a proxy to only one owner at any one general meeting. According to the management office, just like last year, CM2012’s supporters’ completed proxy forms were submitted in bulk by CM2 and EA, that is, they were not submitted individually by either the owners/principals or their proxy holders. No verification was also done whether the owners/principals did personally execute the proxy forms or whether the owners/principals and proxies knew each other.

It is sad to see that the live-in owners who were present were powerless to decide on the affairs of their condominium which they know most. Instead, these outsiders (one of them a former gardener at the condominium), who appeared bored and lost throughout the proceedings when English was used, had the ultimate say.

To my mind, the entire AGM is invalid as the legality of the proxies’ appointment and voting is seriously in doubt because it has also gone against the law of agency.

In fact, I had raised this issue of manipulating the proxy voting system even way back in June last year in my article, “Resolving tenancy disputes” (Sunday Star, June 12, 2011). I also subsequently had a brief SMS discussion with the Housing and Local Government Minister Datuk Seri Chor Chee Heung.

I am glad that the SMA has now made the one-proxy-one-owner rule clear in paragraph 18 of the Second Schedule. However, in light of the above and the relaxation of quorum requirement, paragraph 18 should be amended to state that only an owner’s immediate family member, tenant or attorney (appointed by way of a power of attorney) is qualified to be his proxy. If the owner is a corporation or organisation, the same principle should also apply in that there should be a close nexus between the owner and his proxy.

This will also compel owners to take more responsibility and a keen interest in the management affairs of their properties by making an effort to attend the general meetings. Such an amendment is not required to be tabled before Parliament as the minister is empowered to do so under Section 152 of the SMA.

Timely law

That said, assuming the SMA is in force now, the above fiasco could have been avoided. Under the new law, the Council will be known as a management committee and no committee member shall hold office for more than three consecutive terms. Also, a committee member will be deemed to have vacated his office if his conduct brings discredit on the management committee.

Most importantly, any dispute or altercation among owners living in stratified buildings can be resolved through the Strata Management Tribunal. Hence, the Tribunal ought to be set up expeditiously unlike the Strata Titles Board which was never set up since the enabling provision was first inserted in the Strata Titles Act, 1985 (Act 318) in December 2000.

With an effective and efficient dispute resolution mechanism in place, this will help promote peace and good neighbourliness in stratified buildings. A lot of precious time can also be saved during general meetings. For example, in the Dec 9 AGM, CM2011 and CM2012 members seemed to be more obsessed with each other instead of discussing real issues such as lax enforcement of House Rules, the recent robbery-cum-rape case that reportedly took place and the appearance of a large crack on the exterior wall of the building next to one of its columns.

Similarly, the performance of the managing agent engaged by CM2012 at RM8,000 per month was not discussed. In my view, the performance of CM2011 members in managing the condominium is better than the said managing agent’s. Not to mention, they did it voluntarily. In this respect, I must register my agreement with Chor that registered valuers should not have monopoly over the management of stratified properties because strata owners must be allowed to have a choice and the right to decide who is best to manage their building.

As a whole, congratulations are in order for Chor, Datuk Seri Douglas Uggah Embas, Minister of Natural Resources and Environment (NRE) and their ministry officials in revamping the laws relating to strata management. When the SMA comes into force, the Housing and Local Government Ministry will take over from the NRE in monitoring the management of all stratified buildings and the operation of the SMA. Act 318 has also been amended and the Building and Common Property (Maintenance and Management) Act 2007 will be repealed.

Time will only tell how successful the SMA is in coming to grips with multifarious problems faced by those who live and do business in stratified buildings. But it cannot be gainsaid that this new law marks a new beginning of a comprehensive legal framework in strata management.

> The writer is a former chairman of the Conveyancing Practice Committee of the Malaysian Bar Council.

Source: The Star

Association wants housing ministry to oversee property managers

December 4, 2012

Association wants housing ministry to oversee property managers

By TAN KARR WEI
karrwei@thestar.com.my


Big bucks: It is estimated that property management fees per year can come up to RM1.5bil from 4,000 highrise properties in Malaysia.

THE Building Management Association of Malaysia (BMAM) wants a board of property managers that is independent of the Board of Valuers, Appraisers and Estate Agents (BVAEA).

We are not against the regulation of property managers.

We feel that there should be a separate board that is placed under the Housing and Local Government Ministry to regulate and license all who are qualified and experienced in managing property,� said BMAM president Datuk Teo Chiang Kok.

Under the new Strata Manage-ment Bill that was recently tabled in Parliament, only property managers who are registered valuers are allowed to manage stratified properties in the country.

The association has been lobbying for the term Registered property managers� to be removed from the Bill because they felt that it will create a monopoly of property management by the handful of registered valuers and render all existing property managers unqualified.

BMAM founding members include the Institution of Engineers, Malaysian Institute of architects (PAM), Real Estate and Housing Developers� Association Malaysia (Rehda), Malaysian Association for Shopping and High-rise Complex Management (PPKM), the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM), who together with Joint Manage-ment Bodies (JMB), Management Corporations (MC), facilities managers and managing agents represent over 200,000 members who are also property owners.

BMAM deputy president Lee Weng Onn said the association had presented a draft for setting up a board of building managers to the Housing and Local Government Ministry last year.

There has never been a question of us not wanting regulation,� said Lee, an engineer by profession.

Why an independent board?

Teo contended that all matters pertaining to stratified property fell under the jurisdiction of the Commissioner of Buildings (COB), which comes under the housing ministry, while the BVAEA comes under the Finance Ministry.

All buildings require a certificate of completion and compliance that is issued by the local authority as well.

Besides that, all buildings have to be certified for safety and health annually by the local authority.

If we have building managers who are answerable to the Finance Ministry, how can there be responsibility and accountability?

We are all for legislation but the board should not be under different ministries,� said Teo, who is also Bandar Utama City Corporation director.

BMAM is also concerned that restricting the role of property management to registered valuers can lead to a shortage of valuers to take up the role.

In a previous StarMetro report, Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector (PEPS) president Lim Lian Hong said the public did not have to worry about a shortage of qualified property managers because local universities had been producing hundreds of graduates since the 1970s and there were now thousands of graduates in property management, including those qualified overseas.

Registered valuer Dr Ernest Cheong pointed out that there were currently only about 700 valuers registered with the BVAEA.

According to the BVAEA website (www.lppeh.gov.my), there are 749 registered valuers, 17 registered appraisers, 1,690 registered estate agents, 666 probationary valuers and 306 probationary estate agents.

What is at stake?

According to Cheong, there is an estimated RM1.5bil in property management fees per annum from about 4,000 high-rise properties in Malaysia.

With only 750 registered valuers, each valuer will be handling about RM2mil worth of property management fees per annum.

Bear in mind that not all registered valuers are practising property managers.

There are only 150 valuers practising property management and that will come up to RM10mil per valuer,� said Cheong.

He feared that giving exclusive managing rights to the existing registered valuers could lead to the practice of sub-contracting the jobs to third parties, because the law did not specify that a valuer could not employ another person to do the job.

Cheong said under the Valuers, Appraisers and Estate Agents (VAEA) Act, property managers could charge a professional fee for services rendered.

Why should Malaysians be burdened by this professional fee on top of what they are paying in maintenance fees? Management fees should be left to market forces,� he said.

BMAM secretary-general S. Venkateswaran said the public should be allowed to decide if they wanted the full-fledged service of a professional valuer.

Not all properties have the same needs. Medium- or low-cost apartments with minimum facilities may need only basic services from a building manager,� he said.

Protecting interest of owners

Venkateswaran said the fear-mongering about building managers running off with their maintenance fees did not hold water.

JMBs and MCs of all residential and commercial properties are responsible by law for all funds collected and banked into the building maintenance fund.

The principal officers (chairman, secretary and treasurer) are official signatories to all cheques issued and other financial dealings. All collections are banked into the building management fund.

There must be an AGM held every year, during which accounts are audited, submitted and tabled. Minutes of meetings, secretary's reports and accounts are required by law to be submitted to the COB. All these preventive measures are already in place,� he said.

Qualification versus experience

Teo said property management was a multi-disciplinary management function, some skills which a valuer alone did not have.

A board of building managers should not be restricted to valuers only but instead include professions such as architects, engineers and facility maintenance managers.

BMAM committee member Richard Chan, who is also a past president of the Malaysian Association for Shopping and High-rise Complex Management, said shopping complex managers had been doing well for themselves without being subjected to a board of valuers.

There are now about 300 shopping centres in Malaysia out of which about 40% are strata properties yet hardly any of those are being managed by valuers.

We have managed shopping centres for 32 years, starting with Ampang Park in the 1980s. Our concern is that out of the 750 valuers, how many have actually managed a shopping centre or even a condominium?

For shopping centres, it is not only about property management but also about marketing, promotions and advertising,� he said.

Minister: No plans to set up board yet

Housing and Local Government Minister Datuk Seri Chor Chee Heung said the requirement for property managers to be a registered valuer had been taken out of the act but there was no plans in the near future to set up an independent board of building managers.

There are currently thousands of property managers who are already managing strata properties. Once the Bill has been gazetted, we will monitor the situation.

When BVAEA opened up the registration for current building managers who are not registered valuers, there was a list of conditions to fulfil and many were not interested.

We will see if they can work something out. For now, it is up to JMBs, MCs and developers to choose whoever they wish to manage their property.

If they feel that they need the registered valuers, so be it. We also recognise the contributions of registered valuers.

In the event that unit owners disagree with the sum fixed by the developer, JMB or MC for the purpose of maintenance fees or sinking fund, the Bill states that the COB will appoint a registered valuer to calculate the appropriate fees and sinking funds.

Manpower boost under new Strata Management Bill

December 4, 2012

Manpower boost under new Strata Management Bill

By TAN KARR WEI

OWNERS of high-rise properties in Malaysia will be relieved to know that the Commissioner of Buildings (COB) department will be beefed up with a deputy and extra employees.

Under the Building and Common Property Act (BCPA) 2007, the state government will appoint a COB to administer all stratified properties within each local council.

By default, the mayor or president of a local council becomes the COB with a staff of about five officers running the department.

StarMetro has previously reported that many COBs in Selangor lament the fact that they have not been able to properly take on the role while having to attend to other responsibilities, especially with a concentration of high-rise buildings in places such as Petaling Jaya and Subang Jaya.

To overcome this problem, Housing and Local Government Minister Datuk Seri Chor Chee Heung said the new Strata Management Bill would allow for a deputy COB to be hired and the number of officers to be increased, up to maximum of 16 people.

Over the years, we recognise that the mayors and presidents have too many responsibilities so we will now have a deputy COB who will attend to the role full-time.

We have already identified the local councils that will be needing this post and the additional staff.

There are some local councils throughout the country which do not have high-rise buildings under their administration,� said Chor.

He said the technical officers would be taken from within a council while other clerical officers would be under the payroll of the ministry.

Local councils can expect their new deputy COBs by mid-2013, once the Strata Manage-ment Bill has been gazetted.

Meanwhile, all practising property managers are required to furnish a bank guarantee before being allowed to manage a stratified property.

Housing and Local Government Minister Datuk Seri Chor Chee Heung said this regulation had been included in the Strata Management Bill passed by the Cabinet recently.

揟here has always been this fear of managers disappearing with a property抯 funds so we have made it mandatory for them to have a bank guarantee before being allowed to collect maintenance fees as instructed by the Joint Management Body or Management Corporation,� said Chor.

Once the Bill has been passed by the Senate and the Yang Di-Pertuan Agong, it will supersede the Building and Common Property Act (BCPA) 2007 and the Strata Titles Act (STA) 1985.

Chor said the new Act would still prevent parties who had an interest in the building (for example developers, architects and engineers involved in the development of the property) from managing it.

Source: The Star

"Un-intend" Vandalizaion continues

Endless Football Match at Badminton Court!

Photo taken 15 Feb 2011 06:00 PM