indepth

Unravelling the knots of property management

Questions from participants of TheEdgeProperty.com Symposium on Property Management 2017 were forwarded to the respective speakers after the symposium on April 8. The speakers have tried their best to reply but due to the number of questions received, some need more time, hence Part 2 of the Q&A will be published next week. Please note that both the questions and answers have been edited for clarity. The answers reflect the personal views of the speakers and do not constitute legal advice.

TheEdgeProperty.com Symposium on Property Management 2017

DN Homeowners Bhd chairman Andy Khoo

Andy KhooPlease share about the organisational structure of the private company that manages Duta Nusantara.

Our organisation is a company limited by guarantee and registered as a Berhad entity with the Registrar of Companies (ROC). Every owner of a property in our neighbourhood is a shareholder with a single share in this company.

We are led by an elected board of directors and hold an annual general meeting (AGM) once a year to report to shareholders and for election purposes. The board meets quarterly and sometimes more often to deliberate and decide on company matters pertaining to our community.

The board hired a professional property management company and we monitor the performances of its employees assigned to our property. We also formed different committees to handle specific complex issues and key projects like security, road works and other costly activities.

What are the challenges faced in managing a non-strata property?

The problems in property management are the same as these are normally just people issues pertaining to attitude and behaviour. In non-strata properties, we have to fall back on the Deed of Mutual Covenants (DMC) and take action in line with the DMC, even to the point of legal action.

In strata properties, there are certain steps to resolve conflict among residents. However, in non-strata developments, what can the residents do if they cannot solve the problem among themselves?

If there are proper contracts, processes and procedures, house rules, minutes of meetings and avenues for proposal of resolutions, then a home owner should resort to those.

In the case of non-strata properties, the best recourse would be the DMC (if one exists). If there is an owners’ company or a residents’ association (RA), then refer to the processes and procedures in the Company Memorandum of Articles (governed by the ROC) or RA Constitution of Establishment (governed by the Registry of Societies Malaysia).

Minutes of committee or board meetings should be readily available to members. The right to call for a proposed resolution for members to vote at an AGM or extraordinary general meeting (EGM) should be another option for recourse.

In cases where a minority is unhappy with the majority’s decision, how will you deal with their dissatisfaction?

The minority will have to first propose a resolution for vote during an upcoming AGM or gather enough members/owners to convene an EGM.

If the resolution fails to pass with enough votes at the AGM/EGM, I would suggest that the minority (if they feel strongly enough about the matter) either submit a case for arbitration before an arbitrator or else file a legal suit to force their demand to be heard in a court of law.

The basic tenet of community living and subscribing to an owners’s company or association is to accept and follow the concept of majority-based decisions. So any dispute will need to be decided by arbitration or as a civil case.

How do you handle residents who do not pay their maintenance fees in a non-strata development?

If there is any contract such as a DMC, then one recourse would be to seek legal action. Within that option, the owners’ company or residents’ association would need to send enough letters of demand or invoice/statement reminders. If the member still fails to pay up, the next step would be to secure a lawyer’s letter of demand as a warning of pending legal action. The final recourse would be to file a civil suit for recovery of the outstanding funds. If a legal contract like the DMC is in place, then the case would normally go against the member who would then be ordered by the court to pay the outstanding dues and even made to pay for court/legal costs.

The other option would be to remove any privileges from the recalcitrant member. For example, if there is a resident’s lane with card access entry, then one possible punitive move would be to deactivate the defaulter’s access so that the member is forced to use the visitors’ lane and register for entry. Another option would be to deny access to facilities like the community gym, usage of the common hall for parties or whatever else is given as benefits to paying members.

 

Chur Associates founder and managing partner Chris Tan

Chris TanI’m a foreigner who bought a condo unit which was completed five years ago but the strata title has not been issued yet. What can I do?

Please check with the developer on the status of the strata title application. Since it is already five years from completion, it must be submitted under the previous legal regime instead of the latest Strata Titles Act. Under the previous regime, the developer has to apply for a strata title within six months from the date of vacant possession. Therefore, under normal circumstances, the application should have been submitted.

If you wish to follow up on your own, obtain the submission details from the developer and you can follow up with the authorities directly. Legally, you can still transact a property whether the strata title is issued or not. The developer plays an important role to administer the change of ownership until the strata title is issued and transferred to the rightful owner at that material time, including informing the bank to perfect the charges to replace the assignment of rights before the issuance of the strata title. You can also consider taking a small loan from the bank using the unit as security. This way, the bank can also monitor the progress of the strata title issuance for you.

If the minutes of meetings and AGMs are submitted to the Commissioner of Buildings (COB), when in reality the proxies of the developer in a Joint Management Body (JMB) never conducted any meetings, what can the owners do?

The JMB is comprised of all owners as well as the developer. In this context, the developer can also be the owner if the developer has retained some units. Of course, there can also be developer-friendly owners. Every owner is entitled to be elected into the Joint Management Committee (JMC) of which one seat is reserved for a representative appointed by the developer.

Legally, proxies cannot be nominated to take office as a JMC member. If these members of the JMC are duly elected from the annual general meeting (AGM) in accordance to the due process, the only way to change it is through the calling of an extraordinary general meeting (EGM) by owners to deliberate the performance of the JMC.

If you have good evidence of minutes of meetings submitted without an actual meeting, you can certainly complain to the COB. You can also refer this matter to the Strata Management Tribunal.

(i) In the Sales and Purchase Agreement (SPA), can the developer place the ownership of all the car parks under the developer and not under the ownership of the JMB or Management Corporation (MC)?

This is possible but unlikely to be for all the car parks, as it might be a requirement for car parks to be allocated to the unit owners especially for a residential development. Since you mentioned JMB or MC in this context, you must be referring to the extra car parks after the required allocation to the owners.

(ii) If the car park belongs to the developer, can the developer collect rental, increase rental and restrict residents’ usage of the car park?

The authorities could actually approve the developer’s car park ownership and right to collect rental from residents, especially if it is a commercial development or a mixed integrated development. Owners need to refer to the earlier representation made by the developer to see if the car park was actually promised to them for free and is part of their unit. If the developer indeed rightfully owns it, the developer can certainly impose rental and control access.

Who owns the external façade of a building? Can the developer allocate a portion of it to tenants and allow them to change the appearance of the external wall, including putting up advertisements on it without paying rental to JMB/MC?

Generally, the façade of the building is part of the common property in any strata development. However, it is technically possible for the façade to be owned and be issued as part of a strata title based on the expertise of the submitting surveyor.

The boundaries of the allocation of the external wall will be clearly marked in the strata title in the submission document. Tenants could then put the advertisement at the allocated space without paying rental.

The MC of a condominium has got a court order to auction the unit of a defaulter owner who owes big sums of service charges due to the MC for years. Can this owner now apply to the court to set aside the auction order and to dispute the sum owed, though he never disputed with the MC in the past and his name has appeared on the defaulters list throughout the years? In this case, what is his chance of success? And, should the MC fight this legal case to the highest level?

To auction the property in this context is something that the official assignee does after the owner has been adjudicated a bankrupt. Therefore, it is not setting aside the judgment but rather the bankruptcy. To do so, the owner must have very good evidence and justification.

Everyone is entitled to exhaust the civil court system including the right to appeal against earlier judgements. Settlement is also a right of both the litigating parties should they choose to settle amicably.

Are there any restrictions on the AGM to be held during weekends or weekdays? What if the MC holds meetings when most owners are not able to make it?

An AGM can take place anytime and on any day and there is no restriction against having it on a weekday or weekend. Generally, an AGM should be set on a day with the potential of optimum participation of all owners. As an owner, you can lobby for an EGM to overturn this and collectively with other concerned owners make a point to participate.

You can seek help from the COB or even refer this matter to the Strata Management Tribunal should the AGM seems designed to discourage participation.

The developer did not form the JMB within 12 months upon vacant possession (VP). To urge the developer to form the JMB, a group of owners set up a pro-tem committee to request a meeting with the developer. However, the developer has ignored our request. What can we do other than complain to the COB?

The COB can actually order the developer to convene the first AGM of the JMB. You can also refer this matter to the Strata Management Tribunal.

My seven-year-old apartment has some cracks on the outer wall and rain water has begun to seep in, affecting some apartment units. The developer has refused to repair it as the building has passed the liability period of two years upon VP. What can we do?

First of all, you should engage a professional building inspector to produce evidence that the building was not built in accordance to the acceptable building standards and that the crack is the result of such non-compliance. With that, you can then start a civil claim against the developer.

I’m on the committee of the residents’ association (RA) in an individual-titled guarded-and-perimeter-fenced community. Recently, strata-titled townhouses (within the same boundary and sharing the same entrance/exit, boom gate and common playground) were handed over to the strata owners. My question is, can the same RA manage both the individual and strata owners at the same time?

If the strata owners agree, the RA can continue to manage the part of the community outside of the strata development. Within the boundaries of the strata development, it is strictly the prerogative of the strata owners and the RA has no right at all.

Is there any act that allows an RA to demand unoccupied house owners (individual and strata-titled) to pay their security fees and to charge late payment interest?

No. RA is purely voluntary and only has power over its members who subscribe to the governance of its very own constitution.

 

Singapore Association of Property and Facility Managers president Dr Lim Lan Yuan

Dr Lim Lan YuanDo I need to inform the management if I want to rent out my property via Airbnb? Does the management have the right to stop me from renting my unit through Airbnb?

There should not be any restraint on any strata unit owner with regard to their ownership rights to sell, rent, mortgage, etc. There is therefore no need to obtain approval to sell or rent the owners’ premises.

The control of whether the owners can use their residential units as a “hotel” is with the planning authority which governs the property use, that is, whether the authority allows short-term lodging businesses such as Airbnb in a residential strata development.

Is there any law in Malaysia that regulates property managers? Are there any regulations under the Strata Management Act (SMA) 2013 that state a property must be run by a property management company and not an individual property manager?

It appears there are a few bodies that govern the work of a property manager. The Board of Valuers, Appraisers and Estate Agents is one such body that acts as a regulatory body for property managers.

“Property management” is defined in the Valuers, Appraisers and Estate Agents Act 1981 (as amended). A “property manager” means a person, a firm or a company. There is also no mention in the Strata Management Act 2013 that a property manager should be an individual person or a company. The tasks of a professional property manager are wide-ranging and diverse. Hence, the property management services are often offered by a company rather than an individual. In practice, the management body is likely to prefer management by a company than an individual with limited resources.

The Management Corporation (MC) of a condominium has got a court order to auction the unit of a defaulter owner who owes big sums of service charges due to the MC for years. Can this owner now apply to the court to set aside the auction order and to dispute the sum owed, though he never disputed with the MC in the past and his name has appeared on the defaulters list throughout the years? In this case, what is his chance of success? And, should the MC fight this legal case to the highest level?

The court will decide based on the evidence available. The owner will have to prove that the amount owed by him is not the amount as claimed. The chance of success would depend on the strength of the evidence, how the case is being argued and the determination of the legal provisions.

However, litigation should always be the last resort to resolve disputes in an MC in view of the costs involved and the damage it would cause to the relationship of the residents in the community. Therefore, if there is an offer for settlement, it should be explored. The MC would have to weigh the pros and cons of going all the way to the highest court.

Are there any restrictions on the annual general meeting (AGM) to be held during weekends or weekdays? What if the MC holds meetings when most owners are not able to make it?

Residential MCs should preferably hold the AGMs either during the evenings on weekdays or weekends, as this is the most convenient time and day where most owners can attend the meeting; for commercial MCs, the AGMs can be held during weekdays.

In situations where the majority of owners are not able to attend the AGM, they may want to consider bringing the matter to the Tribunal for the MC to reconvene the AGM.

 

Malaysian Institute of Professional Property Managers president Sarkunan Subramaniam

Sarkunan SubramaniamIs it legal to renovate the balcony of strata units, such as installing window panels or sealing it up with concrete? Does the local council have the power to approve such renovations?

No, it is not legal. You are not allowed to alter the façade. Please refer to the Third Schedule, Clause 29 of the Strata Management Act (SMA) 2013.

The Management Corporation (MC) of a condominium has got a court order to auction the unit of a defaulter owner who owes big sums of service charges due to the MC for years. Can this owner now apply to the court to set aside the auction order and to dispute the sum owed, though he never disputed with the MC in the past and his name has appeared on the defaulters list throughout the years. In this case, what is his chance of success? And, should the MC fight this legal case to the highest level?

In this case, the owner can appeal, but his chances may be slim. It is best to refer the matter to a competent lawyer.

Are there any restrictions on the annual general meeting (AGM) to be held during weekends or weekdays? What if the MC holds meetings when most owners are not able to make it?

There is no specific day or time stipulated in the Act as to the calling of the AGM. Usually the Joint Management Body (JMB) or MC prefers the weekend as it does gather more participants. A resolution could be made at the AGM as to the time or day of future AGMs.

Is there any Act that allows a Resident’s Association (RA) to demand unoccupied house owners (individual and strata-titled) to pay their security fees and to charge late payment interest?

There is no Act for RA, so I suggest the matter be referred to a competent lawyer regarding enforcing payments for security, etc. I believe it would not be possible.

Do I need to inform the management if I want to rent out my property via Airbnb? Does the management have the right to stop me from renting my unit through Airbnb?

The matter is not regulated. The property management cannot prevent you but they could possibly add a new bylaw on the matter through an AGM/extraordinary general meeting (EGM), which you will have a right to vote on.

What are the disadvantages of subscribing to credit tip-off services (CTOS) in order to increase monthly service charges for condominiums and apartments?

There is no disadvantage in subscribing to CTOS. However, it may increase the cost so it’s better to check the cost and get it approved in an AGM/EGM.

Some bylaws on renovations and façade maintenance were passed during an AGM, but some residents did not abide with the bylaws. One penthouse owner drilled and hacked the beams and pillars of the unit to construct an additional floor to seal off the air well; some owners sealed their balconies with glass panels and had their air-conditioning compressors indiscriminately fixed, drilled and some even hacked the beams and pillars. There was no action taken by the developer. Can we use the bylaws against these unit owners although the “illegal” renovations took place long before the coming into effect of the bylaws? What actions can be taken on the property management company?

First, if there is written approval in place from the developer, chances are action cannot be taken against them unless the renovation does not conform to Building Bylaws by the local council. It’s best to get legal advice.

Second, it’s best to terminate the property management company as it would be difficult to prove that they were negligent in approving the renovations unless there were clear guidelines set earlier.

On the damages caused to the building, the cost to rectify will be borne by the owners who are found to be in breach. I advise you to get legal advice and seek an order of court.

There is an increasing number of foreigners moving into the condominium and residents are worried for their safety. Can the JMB/building management issue a notice to all property owners to stop investors from renting out to a specific group of people or nationality?

No, they cannot as this would be racial discrimination. My advice is to hire an effective property management company and impose stricter rules.

Is a property manager currently regulated under any Malaysian law? What is the role of the Malaysian Institute of Professional Property Managers (MIPPM) and what is the definition of “professional property managers”?

The property management profession is governed by The Board of Valuers, Appraisers and Estate Agents Malaysia’s (BOVAEA) Act where property managers are registered. However, the SMA 2013 allows non-registered persons to also provide the services, provided they lodge a bond.

MIPPM is a professional body for the interest of registered and non-registered practising property managers. Professional property managers refer to those who practise property management as a full-time profession.

If the JMB of a condominium decides to engage an individual property manager instead of a property management company, are there any regulatory requirements for such an engagement, ie registration, qualifications, etc?

The JMB or MC has the prerogative to hire anyone as a staff to help them manage the premises. If the JMB/MC hires a property management company which is already registered with BOVAEA, the company does not need to pay a bond equivalent to 12 months fee to the JMB/MC. However, if the company is not registered, then the JMB/MC should collect a 12-month bond from them.

Clause 87 of the SMA 2013 places some restriction on the hiring of managing agents who have professional or pecuniary interest in the building to be subdivided.

Is there any regulation under the Strata Management Act 2013 that a property MUST be run by a company, thus direct engagement of an individual property manager by the JMB is not allowed?

No, there is no such provision.

Can a security company be the point of contact and act on behalf of the management company of the strata building for non-security-related complaints such as noise from neighbours or problems with common facilities?

Usually, the report of the problems could be directed to the security office after working hours, but must be empowered or approved by the JMB/MC. If it is a major issue, the security company should call the property manager on standby.

What is the standard practice for a property management of a strata building in the event that there are any urgent complaints or incidents that arise after their official working hours or during public holidays?

It is usual for the property manager to be on standby and to come over and solve such incidents if the matter is critical. The property manager’s line of communication during or after working hours for any emergencies must be pre-set. Usually, the security will alert the property manager.

How can we find out about the property management company’s past reputation, track record and reviews other than hearsay from previous strata building owners or residents?

The JMB/MC should ask for references from the property managers during the tender period and visit the sites that they are currently managing.

 

Building Management Association Malaysia president Tan Sri Eddy Chen

Tan Sri Eddy ChenIs there any checklist for buyers to inspect their house before moving in?

Usually the property purchaser’s checklist is prepared by the developer in consultation with their engineers and architects. The checklist differs from project to project, whether it is commercial, industrial, residential, etc.

Who or which authority can we complain to if property owners are unhappy with the building construction workmanship?

The defects liability period (DLP) stipulated in the Sales and Purchase Agreement (SPAD) is a good provision for property purchasers to seek rectification/compensation from the developer in the event of building defects. As to poor workmanship, it is subject to the burden of proof, and the purchaser may be required to engage the services of a consultant (engineer, architect, etc) to verify and certify that the said building defect can be wholly attributed to poor workmanship on the part of the developer.

It should also be noted here that complaints of poor workmanship often also arise when purchasers have done renovations during the DLP, and the renovation works have not been done by authorised and registered contractors or not according to approved renovation plans of the municipal council. Many owners may not even know that all renovation plans have to receive prior approval from the Joint Management Body (JMB) or Management Corporation (MC) and the municipal council, and that the renovations must be in compliance with the Uniform Buildings (By Laws).

In SPA, can the developer place the ownership of all the car parks under the developer and not under the ownership of the JMB or MC? Can the developer collect rental, increase rental and restrict residents’ usage of the car park?

The clear identification of whether an area in the master title (ie building premises) is common property (which includes common facilities) will have to be made by the Registrar of Titles (Pendaftar Hakmilik), and this would have been clearly identified in the master title.

 If the area discussed happens to be a car park, it would usually be considered as common property (harta bersama). If it is common property, then the developer would not be able to claim control over the car parks. However, if the car parks have been subdivided and issued as strata titles by the Registrar of Titles, then the car parks would be under the developer’s control, in which case appropriate share units would have been allocated to the car parks, and the developer, like other strata owners, would also be required to pay maintenance charges to the JMB or MC.

As to whether the developer has the right to identify the car parks as property belonging to the developer and can include them in the SPA, it is subject to the contract law principle of “caveat emptor” on the part of purchasers before they sign the SPA. The purchasers are at liberty to refuse signing the agreement if they disagree with this arrangement. Any dispute after signing the agreement, all the more so after the share units have been allocated for the car parks in favour of the developer, may be academic.

Who owns the external façade of a building? Can the developer allocate a portion of it to tenants and allow them to change the appearance of the external wall, including putting up advertisements on it without paying rental to JMB/MC?

The external façade of a building will usually be deemed as common property and would be under the jurisdiction of the JMB or MC. But this will have to be verified from the master title and from the building plans. It is highly unlikely that the external façade could belong to the developer, unless of course there is an extension or additional structure built by the developer for which share units have been allocated and the same has been identified as a strata parcel owned by the developer in the master title.

Advertisements by tenants are subject to house rules and that would differ depending on the category of use of the building (commercial, residential, mixed development). Rentals from such advertisements (banners, hoardings, etc) have to be paid to the JMB or MC if the external façade has been identified as common property.

I’m a foreigner who bought a condo unit which was completed five years ago but the strata title has not been issued yet. What can I do?

The Strata Management Act does not distinguish between cash buyers and foreign buyers. There are no special provisions in the Act for such buyers. Under the new provisions of the amended Strata Titles Act, all strata titles would have to be issued for buildings within 12 months of the issuance of the certificate of completion and compliance (CCC) by the building architect/engineer.

In fact, the law now requires the strata titles to be handed over to the owners when they receive vacant possession of the premises, in which case even the JMB need not be set up and the MC can function immediately.

Complaints pertaining to strata titles and related issues may be made with the Strata Management Tribunal under the Ministry of Urban Wellbeing, Housing and Local Government (KPKT).

Is it legal to renovate the balcony of strata units, such as installing window panels or sealing it up with concrete? Does the local council have the power to approve such renovations?

Renovations to balconies, including sealing up the balconies, are not permitted and are illegal. They are contrary to the approved building plans by the municipal councils and are in breach of the Uniform Buildings (By Laws). Municipal councils will not authorise such renovations. The JMB or MC is empowered to take action against owners who have done illegal renovations such as these as they are provided for under the house rules of the building as seen in the Third Schedule of the Strata Management Regulations (SMR).

The developer did not form the JMB within 12 months upon vacant possession (VP). To urge the developer to form the JMB, a group of owners set up a pro-tem committee to request a meeting with the developer. However, the developer has ignored our request. What can we do other than complain to the Commissioner of Buidlings (COB)?

The delay in forming the JMB can be caused by several factors, though the developer itself may be one of them. It could be due to the fact that the Building Maintenance Account has not been updated as there may be arrears of contributions due from purchasers. Or there may be technical delays with regards to the submission of documents for sub-division, and several other issues of a legal nature. It may be better for the purchasers to report to the COB, in the event that the developer is unwilling to meet the purchasers to seek an amicable settlement.

My seven-year-old apartment has some cracks on the outer wall and rain water has begun to seep in, affecting some apartment units. The developer has refused to repair it as the building has passed the liability period of two years upon VP. What can we do?

The developer’s DLP is only two years after handing over VP to the purchasers. Building defects seen after the expiry of the DLP is not the responsibility of the developer.

If such defects appear in the common property, it becomes the responsibility of the JMB or MC. If such defects appear in the individual units (strata parcels), then it is the responsibility of the owner(s) concerned.

 

Architect Centre accredited building inspector and trainer Anthony Lee Tee

Anthony Lee TeeYou mentioned that one in five apartments could be unsafe, can you elaborate on that? What kind of problems can cause a residential building to be unsafe?

These are based on hundreds of actual inspections of properties throughout Malaysia carried out by accredited architects and mechanical and electrical engineers from 2008 until now. Types of properties inspected include strata units, strata common areas, commercial buildings or offices, mixed strata, hotels, factories, malls and private dwellings. Based on these sampling and findings, we estimate that one in five properties are unsafe.

Every property has some form of defect, depending on its age, maintenance, wear and tear. The defects can be classified into two categories — “straightforward defects” (which can be repaired, maintained or replaced) and “serious defects” (which have not complied with a bylaw, rule or requirement, and pose a clear and present dangerous condition to the property and lives if left unattended).

For high-rise apartments, unsafe issues are related to unregulated installation of residual current device units or circuit breakers, inoperable fire doors, usage of non-safety glass (safety glass is generally unregulated in Malaysia at this time), handrail designs, bio-hazards from leaking bathrooms from the units above, mould from dampness and leaks.

Many mixed strata apartments such as those sitting on a commercial podium also suffer from serious unsafe issues related to fire and electrical hazards, and leaks and cracks which allow water seepage into mechanical and electrical (M&E) rooms.

The combination of design deficiencies, aesthetics over safety, many non-registered designers posing as registered architects, poor supervision, poor workmanship during construction, buildings poorly managed and maintained after completion, unregulated renovations and apathy have produced a deadly cocktail of unsafe properties.

Is it legal to renovate the balcony of strata units, such as installing window panels or even sealing it up with concrete? Does the municipal council have the power to authorise such renovations?

Many regulations and house rules do not allow any form of renovation to balconies of strata units, unless a particular situation exists where an existing balcony is unsafe or for older properties where it may have rusted or fallen off. It is unusual for a municipal council to get involved.

My seven-year-old apartment has some cracks on the outer wall and rain water has begun to seep in, affecting some apartment units. The developer has refused to repair it as the building has passed the liability period of two years upon VP. What can we do?

This is a latent defect and depending on the actual root cause of the wall crack, the Joint Management Body (JMB) may have a recourse against the developer.

In the meantime, if the crack is letting water inside the apartment, then unsafe conditions may exist, ie electrical installations exposed to dampness and water seepage. Also, the cracks may result in wall plastering falling off. Both are very typical and dangerous! Hence, JMB is recommended to engage independent inspectors to assess the current condition and root causes and make a recommendation.

Is there a checklist on what we should be inspecting when we move into a new property?

The checklist prepared by TheEdgeProperty.com in the story “Tips on how to inspect a property and avoid buying a lemon” which appeared in their pullout on Dec 2, 2016 is adequate for a new property.

However, the list becomes more complicated for common areas in strata properties. The list for the common areas must include all M&E installations and systems, fire protection and escape, façade, roof and facilities.

For an apartment owner, this is very technical and some rooms are off limits to unskilled people. Hence, once the JMB is formed, engage independent inspectors to assess the current condition and root causes and make a recommendation the soonest possible.

I’m the owner of a new serviced apartment unit located at Ara Damansara. Would I be able to engage the services of a building safety inspector to inspect my unit before I move in?

Please contact Architect Centre Sdn Bhd for an independent Property Inspection Report. We have conducted hundreds of such inspections.

How many independent building inspection companies or bodies are there in Malaysia?

As far as we know, only Architect Centre can claim to be an “independent body” as it belongs to the Malaysian Institute of Architects (PAM). All inspectors are accredited after a rigorous course by the company. There are professionals and experts who offer inspection services as well. Architect Centre has initiated a collaboration with Pertubuhan Ikram Malaysia for government assets.

Who or which authorities can we complain to if property owners are unhappy with the building construction workmanship?

Once a building is born sick or defective with lots of deficient workmanship, it becomes very difficult and costly to repair. A “repair” is still only a “repair” and if the repair is not correctly diagnosed, it will be a cosmetic repair and the defect will resurface sooner or later.

We usually advice aggrieved parties to depend on the deliverables stipulated in the Sales and Purchase Agreement. Individual owners may contact the National House Buyers Association and find recourse from the Housing Tribunal.

Collectively, when the JMB is formed, many JMBs have taken similar matters to the courts and relied on independent reports.

Next time, always do your due diligence and background checks on the reputation of developers, and be prepared to walk away regardless of how good the location, selling price, freebies, show house or glossy brochures that may entice you. A property is a lifelong investment and the condition of the property should be equally so.

If a latent defect shows up after the defects liability period (DLP), is there any scope for making a claim? If yes, what is the time limit?

This is a very common condition faced by purchasers. If the defects show up after the DLP but the purchaser had previously complained about it, then he or she has a good case, ie the original defect was not repaired properly during the DLP.

However, if it is a new defect, then the root cause of the defect must be established. If the root cause indicates a deficient condition due to shoddy workmanship that was hidden, then the purchaser has a case to bring up. However, the root cause is usually technical and requires an independent inspection report.

The statute of limitations is six years in Malaysia from the time of discovery/complaint. What this means is — if a latent defect shows up in the 10th year, the owner may have up to six years to file a claim. There are several court cases for similar issues in Malaysia.

The fundamentals for the two years of the DLP is to address issues with shrinkage and minor defects as the building “dries” up. Buildings are hand-made, unlike a manufactured product, so some degree of defects is expected.

However, latent defects like falling tiles, serious cracks and leaks are not contemplated and would not occur in the first place if the workmanship was done correctly to begin with! A building is meant to last a lifetime (depending on the intended lifespan of certain materials and installations) and not just for 24 months.

Is the falling of wall tiles due to workmanship considered a latent defect?

Yes. Unless the owner did some modifications or alterations.

The occurrence of falling/popping tiles has become a systemic defect in Malaysia, and we conduct dedicated Kisah Benar Training Courses for developers, contractors, consultants and property managers just for this one very widespread issue. Falling wall tiles and popping floor tiles at staircases are unsafe.

This story first appeared in TheEdgeProperty.com pullout on April 14, 2017. Download TheEdgeProperty.com pullout here for free.

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