indepth

Q & A with the speakers

Questions from the audience were forwarded to the respective speakers at EdgeProp.my Symposium on Excellent Property Management 2018 following the event on May 12 and the speakers have answered the best they could. The replies reflect the speakers’ personal views and do not constitute legal advice. Questions have been edited for clarity.

Anthony Lee Tee (Architect Centre Sdn Bhd accredited building inspector and trainer)

 

You mentioned about asbestos sheet, which could cause lung disease. Can you elaborate on this?
The usage of corrugated asbestos roof sheeting has been banned for decades in most countries due to health hazard reasons. However, it is still being manufactured, sold and used widely in Malaysia.
Medical research reports showed that asbestos fibres contain harmful elements that could cause cancer and asbestosis, a type of lung disease caused by inhalation of asbestos fibres.
Where asbestos has been used, the removal is carried out only by specialists using proper hazmat suits, etc, with controlled disposals. It is very irresponsible to allow for asbestos roof sheeting to be manufactured and sold. However, the awareness of asbestosis is obviously very low.
It is advisable for property owners who are currently using asbestos roof sheeting to consider changing it to asbestos-free roof sheeting, which is widely available in Malaysia.

If I have purchased some electrical appliances from overseas, how can I make sure it’s safe to use at home?
There are 34 categories of controlled electrical appliances that require the Energy Commission (ST) or SIRIM approvals.
These electrical appliances range from plug sockets, lamp fittings, circuit breakers, kettles, refrigerators, water heaters, air-conditioners to audio and video players. The public could access the relevant information through the ST website or contact ST directly.

How would I know if my water heater is safe to use? When is it time to change my water heater?
The replacement life cycle will depend on the manufacturer’s recommendation, upkeep, and wear and tear.
For the installation of a water heater, please engage with a qualified electrician or plumber for safety reasons. Besides this, do follow the manufacturer’s specifications when using the water heater to ensure your safety.
For more information, please refer to ST’s guidelines on the design, installation, inspection, testing, operation and maintenance of water heater systems. The guidelines are available on ST’s website.

I’m using centralised gas system in my condo. Where can I get a gas leak detector, and will it be very costly to install one?
There are stand-alone domestic LPG or natural gas detectors sold online for under RM100. However, for safety reasons, please check with ST for the details.

Is an induction cooker safer than a gas cooker? Should I change my gas cooker to an electric induction cooker?
Electricity or gas can be equally beneficial or dangerous if used carelessly, without supervision or installed by unqualified people. Common sense prevails.

How would I know if the design of my condo is faulty in terms of fire safety?
Engage independent professionals to assess the fire safety of your property. If it is a strata high-rise residence, a yearly safety inspection is recommended.

For landed houses, do you think there is a need to engage experts to inspect the house from time to time?
Landed properties may have been altered or renovated from time to time. We recommend safety inspections once every two to three years, or after renovations or refurbishments have been carried out. Do ask for immediate inspection if the property experiences frequent electricity power trips.

Low Chee Leong (Praxcis Design Sdn Bhd director)

 

If we have limited budget and can only focus on either the softscape or hardscape, which should we choose and why?
Focus on the softscape. Apart from natural beauty, plants will remove carbon dioxide and return oxygen into the environment. This provides immediate benefits for you and your family.
You can buy online simple DIY automatic irrigation controller and drip lines, and connect to your rainwater harvesting tank. It will take away the time needed for you to irrigate the plants.

What is the main consideration in planning a functional landscape in an established or existing project? Do we need to get permission or consent from any authorities in case we need to cut down trees or things like that?
Investigate whether the soil depth you have is on reinforced concrete desk because that will determine everything from shrubs, trees to turf.
Keep the landscape simple, adopt a natural look or a modern minimalist approach, as it will need less care.
All trees and plants outside your property belong to the local council, so you need permission to cut them down, but before you consider taking any trees down, consider the possibility of keeping them. Explore all options before you make that decision.

How to find a qualified landscape architect? Any list or association to refer to? What is the cost?
The Institute of Landscape Architects Malaysia has a list of qualified landscape architects. If it is a small house garden, just make it a family project. Do research on plants and design, and get the kids off their mobile phones and encourage them to reconnect with nature together.

Do you have any example on the value appreciation difference between a property with landscape and one without?
This will make an interesting dissertation or thesis topic, and a great research area for property valuers as well.

Please suggest a few easy-to-maintain shady trees to be planted in an existing landed housing area.
Dalbergia Latifolia, Osmasia Pinnata, Alstonia Augustifolia and Samanea Saman.

Chris Tan (Chur Associates managing partner)

 

Pertaining to the issue of “encroachment” in stratified properties, what can we do when we face scenarios as follows:

a) Scenario 1
There is an owner of two condo units on the top floor of a 3-storey walk-up block with a common area/landing leading to the front entrance doors of the units. Since no one else uses the common area/landing, he decides to claim the space by renovating and constructing a door where the staircase meets the top landing. If the strata title has been issued, can the proprietor apply to the management corporation (MC) to grant him special privileges with regard to the common property under By-Laws clause 4 of the 3rd Schedule, Strata Management Act 2013: Strata Management (Maintenance and Management) Regulations 2015?

The strata title issued will clearly indicate the exact area owned by the owner. There is no such thing as claiming the space. If it is common property, it must be enjoyed by all owners of the strata development. The MC at best can give a licence for exclusive use of the common area, subject to the terms and conditions set by the MC, but not giving away ownership of the common property.

b) Scenario 2
The owner of a unit on the first floor of a 3-storey walk-up block with a common area/landing leading to the front and side (kitchen) doors of the unit intends to use the space on a temporary basis after working hours, and wishes to put up a sliding-folding screen to provide privacy when he has visitors/guests. He undertakes not to obstruct the access during the day or working hours if technicians need to work on the riser compartment within this space. If the strata title has not been issued, can the proprietor apply to the joint management body (JMB) to grant him exclusive use and enjoyment of part of the common property, subject to conditions, under By-Laws clause 4 of the 3rd Schedule, Strata Management Act 2013: Strata Management (Maintenance and Management) Regulations 2015?

Yes, just like the basis of the previous answer. Due consideration must be given to the fact that the riser is within the area of common property intended for exclusive usage. Safety is a concern, where it requires unobstructed and timely access.

c) Scenario 3
If a strata unit adjoins a common property — in this case, a small portion of reinforced concrete flat roof that is not accessible to the JMB’s or joint management committee’s (JMC) property management team for maintenance purpose except through the said unit — can the proprietor apply for permission to have exclusive use and enjoyment of that part of the common property (such as the flat roof area), on condition that he undertakes to maintain it for the JMB/JMC, pursuant to By-Laws clause 4 of the 3rd Schedule, Strata Management Act 2013: Strata Management (Maintenance and Management) Regulations 2015?

Yes, but subject to the terms and conditions set by the management at the material time (either the developer or JMB or MC).

We are a self-managed MC. I discovered that the manager’s contract has expired since May 17, 2017. When I questioned the previous MC as to why the manager is still here when the contract had not been renewed, none could answer me and no one wants to be responsible for this. I would like to consider the option of hiring a professional property management company, but I do not know how to terminate this manager without creating trouble for the MC. May I kindly ask for advice on this?
Firstly, look at the terms and conditions of how this manager was appointed in the first place. Look for clauses in relation to termination and renewal. If the contract has indeed expired and has not been renewed (it could just be a month-to-month contract now), parties are free to negotiate on how to proceed further or to end it amicably. Please seek the help of a lawyer to better advise you upon looking into the details.

I have purchased a landed strata management property. Upon completion, it was found that the fencing provided by the developer was a normal type and not with the anti-climb feature. The developer claimed it had followed and complied with the SPA clause and therefore no appeal can be made. Is there any way the purchaser can take this case to the tribunal?
Look at the agreement with the developer again and see if there is any specific representation to provide the anti-climb fencing so that you can start your negotiation with basis. In any event, you can always refer to the Tribunal for Homebuyers if the claim is below RM50,000, and not the Strata Management Tribunal. This is not a strata management issue.

The legal knowledge and understanding of the concept of communal living is often lacking. In your opinion, what can be done to raise awareness among homeowners and JMB/MC committee members to ensure harmonious communal living?
EdgeProp.my is doing a good job in raising the awareness with this yearly symposium as well as EdgeProp Malaysia’s Best Managed Property Awards. Personally, I have always been an advocate for a basic training to be carried out for JMB and MC members before they take office. It is important for the community as well as the members themselves, as they can be potential personal liabilities.

What is your advice to stakeholders in communal living — developers, property managers, owners and others — on what can be done to raise the standards of communal living?
Parties must act in collaboration instead of being adversaries and this mindset must be practised all the time. Developers should conduct pre-vacant possession education to all owners to equip them with the basic knowledge and ensure a better handover. Owners tend to be more defensive if they do not know any better. Generating options is the key to any solution.

Strangers are coming into our stratified condominium because some owners are leasing out their car park spaces to people working in nearby offices. This has raised security concerns among other owners because these renters are holding access cards that allow them access to the car park spaces. They have also been registered with the management office to allow them access. We’ve tried to convince the owners who are renting out their car park spaces to stop doing so, as we do not want to compromise on security, but most of them claim that they have the right to do so. Is that true? What is your advice on this?
Legally, the owner of any property is entitled to full enjoyment of the same subject to any express condition. If your stratified condominium is designated for residential usage under the master title, it should be rightfully enjoyed by the owners and their permitted residents. Owners can pass a by-law at the annual general meeting and enforce the restriction. In the event it is challenged, refer the matter to the Strata Management Tribunal for eventual determination.

Datuk Jeffrey Ng (Rehda Institute chairman)

 

In a mixed development where there is only a master title but the development comprises a shopping mall, hospital and residential apartment block, on what basis will the service charge be calculated? Will it be based on the whole development or separately based on each entity (shopping mall, hospital, apartment block)?
The service charge in a subdivided development is computed based on the approved share value predetermined by the developer in the Certificate of Share Unit Formula (commonly referred to as SiFUS) and the Schedule of Parcels submitted to the Commissioner under the Strata Management Act 2013. Such share value computation should be carried out in accordance with the formula set out in the first Schedule of the Act.
While the first Schedule seeks to provide clarity and an equitable basis for the computation of share value and subsequently service charge, there remains many questions and arguments on sharing of maintenance and management expenses, especially in a mixed development that comprises various uses such as residential, retail, commercial and hospital components.
In a mixed development with one master title, all components will at their onset collectively form a single management corporation. All components of the development will share all rights and obligations, including payment of service charge and sinking fund in the development in accordance to the share value established, based on the procedures outlined above.
However, the Strata Management Act 2013 provides an option for the management corporation of a mixed development to streamline the maintenance and management of each different component within the development. Section 63 of the Act allows for the formation of a subsidiary management corporation and demarcation of limited common area for each different component in the mixed development, where maintenance charges can be managed separately for each separate subsidiary management corporation.
In this example, there will be separate subsidiary management corporations for residential, retail and hospital. Each subsidiary management corporation will manage its own maintenance expenses for its own limited common area while sharing only the maintenance expenses with all other subsidiary management corporations on the management and maintenance of the common areas such as common access roads, facilities and services.

What are some of the challenges in coming up with the planning and design of a mixed use development?
The challenges are:

  • Defining common areas and limited common areas in advance may be difficult and requires very good coordination within the development team to ensure clear separation of services and facilities in accordance to the demarcation of the limited common areas.
  • Electrical circuits, standby generators, plumbing pipelines, air-conditioning plant, chilled water pipelines and others may not be designed and laid according to the subdivision of limited common area and boundaries of the subsidiary management corporation. Hence, it makes metering and separation of utility charges and maintenance charges difficult.
  • There should be equitable contribution of maintenance charges for each different component of the development. Different components will have different frequency of usage and enjoyment of the common facilities. Some may not use certain facilities at all.

What is good property management to you? Is it the ability to evolve with the times? Or the ability to streamline operations budget?
Good property management is the ability to provide prompt action in responding to customer and regulatory requirements. It is also important to achieve a balance of good service delivery and equitable maintenance charge contribution. While the ability to streamline operational budget is important, one must also be able to evolve with the times with regard to the adoption of new technology and processes.

How can we ensure a smooth handover from the JMB to the MC? Things mostly look good until the handover to the MC because the developer of the project has always supported the maintenance cost as they are still part of the JMB. Any advice on how to keep things up after the handover? 
To help ensure good maintenance after the handover to the MC, it is important for the developer to compute the service charge on a sustainable basis covering all necessary expenses. Some developers may deliberately keep the service charge low as a marketing gimmick, but this will result in maintenance budget deficits.
The developer should carry out the duties, during the preliminary management period, as prescribed by the Strata Management Act 2013 and conduct a proper handing over to the JMB or MC, including all monies in the maintenance and sinking fund accounts, building drawings, manuals, certificates and licences.
It is also important that the MC appoints a registered and experienced property manager at a reasonable fee. Self-management, if possible, should be avoided.

I live in an old (15 years old) and low-density (about 40 units) non-landed development. The low density has its pros and cons — whereby I’m charged about RM800 every month for my maintenance fee. It is crazy. I know this may be due to bad planning by the developer, but is there anything the MC could do to reduce the budget? 
Share value was introduced by the Strata Management Act 2013, which took effect in 2015. Prior to the implementation of this new Act, service charge was computed based on the number of units in the development and the size of the units.
The owners of this development have to accept that the development is a low-density development. It does not have the economies of scale, which thus results in a higher service charge compared to other higher density developments. Nevertheless, it is more important to look at the service charge comparatively on a psf basis, as opposed to a total quantum of RM800 per month. A service charge of RM0.30 to RM0.40 psf would be considered reasonable in the market while some exclusive low-density developments would require about RM0.70 to RM0.80 psf to maintain the common areas.
To reduce the maintenance budget, the MC could review the scope of maintenance works, appointment of service providers, adoption of technology to reduce expensive manpower such as security guards, and reduce electricity consumption in common areas by installing motion or optical sensors as well as the adoption of renewable energy and the Internet of Things.

I have purchased a landed strata property. Upon completion, it was found that the fencing provided by the developer was a normal type and not really with the anti-climb feature. The developer claimed it had followed and complied with the SPA clause and therefore no appeal can be made. Is there any way the purchasers can take this case to the tribunal?
It is not normal for the sale and purchase agreement (SPA) with the developer to state what would be the details and specifications of the common areas such as the quality and specification of fencing. As such, it will be difficult to win in the tribunal as this is often not specified in the SPA. However, one can approach the developer and advise that if the developer cares for his reputation and future sales, the developer should take an effort to improve the fencing, hopefully on an equal sharing basis. This approach may lead to an amicable solution benefitting all parties concerned.

Khaw Chay Tee (Sri Penaga Condominium management corporation chairman)

 

As the Sri Penaga Condominium MC chairman, can you please share the strategies used to achieve monthly maintenance fee collection rate of 95% to 100%?
There is the soft approach and there is the hard approach. The soft approach is for the front line property management staff in the management office and the building manager to build a rapport with all owners so that a few phone calls or email reminders are sufficient for payment to be received. Owners are also made aware that late payment will incur interest at 10% per annum and no request for waiver of interest will be entertained.
Allowing and enabling owners to pay their maintenance fees by credit card, direct debit or standing bank instructions have also helped Sri Penaga Condominium to maintain its high collection levels. [Please note that banks will charge a fee of about 1.8% for facilitating payment of maintenance fees by credit card.]
The hard approach is to issue notices and take actions provided for under paragraph 6 of the Strata Management (Maintenance and Management) Regulations 2015, which includes:
1. Displaying each defaulter’s name and details on the notice boards
2. Deactivating the defaulter’s access card, tag or transponder and requiring him or her to sign in a defaulter’s book each time he or she requires assistance to enter or exit the condominium
3. Stopping or suspending the defaulter from using the common facilities Sri Penaga Condominium has not yet had to resort to the hard approach to obtain payment of its maintenance fees.

How did the Sri Penaga Condominium MC build a transparent, friendly and professional management office staff?
There is no short cut to achieving this. The management committee and its committee members have to take the lead, set the standards and establish the culture for the on-site property management staff. The role of the building manager in maintaining the required standards and reinforcing the culture on a day-to-day basis is also very crucial. As such, management committees should choose their building managers carefully, as well as monitor and guide them.

How do we achieve transparency in the “complaint management”? Currently, even as the MC chairperson, I have no idea how many complaints actually come into the office and how many have actually been solved. Recently, two cases surfaced on our Facebook group that their complaints have not been addressed. It seems like, if any owner is in the committee, the manager would solve their problems while others are ignored. I want to change this favouritism practice.
At Sri Penaga Condominium, we have a website where any owner or resident can log in and lodge a complaint. Each complaint is assigned a ticket number, which will then have to be dealt with by the property management team. All complaints received and the action taken by the property management team have to be reported to the management committee at every management committee meeting.
If your condominium does not have a website, then you can perhaps start with a complaints record book that is kept in the management office where residents can fill in the date, their details and their complaints on one side and the management can fill in the action taken, who attended to it and the date on the other side. This complaints record book should be reviewed by the management committee at least at every management committee meeting, if not more frequently.

We are a self-managed MC. I discovered that the manager’s contract has expired since May 17, 2017. When I questioned the previous MC as to why the manager is still here when the contract had not been renewed, none could answer me and no one wants to be responsible for this. I would like to consider the option of hiring a professional property management company, but I do not know how to terminate this manager without creating trouble for the MC. May I kindly ask for advice on this?
You cannot deal with this issue alone. You will need the support of the majority of your management committee in order to deal with it. I suggest that you ask the following questions and take the following steps:
1. Ask the management committee members if they are satisfied with the performance of the building manager. If the majority of them say yes, then it is unlikely that you will be able to take the issue of terminating the building manager’s contract any further. If the majority say no, then you take the next step.
2. Get the approval of the management committee to look into the contract of the building manager and to get legal advice as to how it can be lawfully terminated and what compensation (if any) needs to be paid. Present the findings to the management committee for discussion and decision. If the decision is to proceed, then take the next step.
3. To ensure there is no disruption to the day-to-day management and maintenance of your condominium, get the approval of the management committee to contact a few property management companies interested in managing your condominium and select one and employ them before terminating the building manager.
There is another approach to the problem that I can suggest. Get the approval of the management committee to contact a few property management companies interested in managing your condominium. Inform the property management companies that you will require them to take over the employment of the building manager and the other directly employed staff of your condominium. If they agree, this approach will be the least disruptive for your condominium.

What happens when there is dispute between the property management company and the MC? The property management company is hired by the MC, so the MC has the right to make the final decision. What happens if the decision made [by the MC] is not actually beneficial for the residents? How then can the property management company resolve this and how should this situation be handled?
The duty and responsibility of a property management company is to advise and guide the MC that has employed them. If the MC makes decisions that the property management company does not agree with, then the property management company can take a number of steps, including:
1. Discuss the disagreement with the management committee and see if a resolution can be arrived at.
2. Put the reasons for such disagreement on record in the minutes of the management committee meeting.
3. Put such disagreement on record by writing a letter to the chairman of the MC with copies to all the committee members.
4. Give the MC notice of termination of their appointment as property managers, stating the reasons why.

From my experience, it is difficult to get people to serve on the management committee. How do you go about convincing the residents of Sri Penaga Condominium to be a management committee member, more so when there is strict Code of Conduct?
The minimum number of members required to form a management committee under the law is not fewer than three (3) owners, so you only need to persuade two (2) other owners who are prepared to serve on the management committee to stand for election together with you! Sri Penaga Condominium only introduced its Code of Conduct for Committee Members a few years after the MC was formed. You can always start off without a Code of Conduct or with only a few simple rules and then introduce more rules when the management committee has served for some time and stabilised.

This story first appeared in EdgeProp.my pullout on May 17, 2018. Download EdgeProp.my pullout here for free.

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