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