High Court: Utility room, parking bays not common property in Kepong condo

KUALA LUMPUR (Aug 14): The High Court has ruled that a utility room and 115 parking bays at First Residence condominium in Kepong are not common property, reinforcing that ownership in strata developments is determined by the approved strata documents rather than how the facilities are used or perceived by residents.

In a recent judgement that could have wider implications for strata property disputes, Justice Anand Ponnudurai dismissed claims by the First Residence Management Corporation (FRMC) and 94 residential and commercial unit owners that the disputed areas should belong to all parcel owners.

The dispute centred on a 166 sq ft utility room, known as Utility 1, and 115 accessory parking parcels on Level 1 of the mixed residential and commercial development.

The MC and unit owners argued that these areas were in reality common property and had been improperly carved out by the developer before being sold to TSI Property Management Sdn Bhd.

Justice Anand disagreed, saying the approved Schedule of Parcels and certified strata plans clearly identified Utility 1 as an individual parcel and the 115 parking bays as accessory parcels.

"Since Utility 1 and the 115 accessory parcels are expressly identified as a parcel and accessory parcels respectively in the documents, they cannot in law be reclassified or treated otherwise," the judge said.

In reaching that conclusion, the court relied heavily on earlier Court of Appeal authorities holding that certified strata plans are the definitive reference for determining whether property forms part of the common property in a strata development.

Fraud claim not proven

The plaintiffs also sought to invalidate the strata title, alleging it had been obtained through fraud after planning authorities were supposedly misled during the approval process.

However, the judge said they failed to prove those allegations.

Although the plaintiffs claimed the authorities had been deceived, they did not call witnesses from Kuala Lumpur City Hall (DBKL), the Federal Territories Land and Mines Office or the Department of Survey and Mapping Malaysia to support that assertion.

Without evidence from those agencies, the court said it could not conclude that fraud had occurred or that the registered title should be set aside under the National Land Code.

Rental of parking bays did not change ownership

The plaintiffs further argued that the parking bays had effectively ceased to be accessory parcels because they were rented out commercially.

Justice Anand rejected that argument, holding that operating a commercial parking business does not alter the legal status of accessory parking parcels or convert them into common property.

Accordingly, TSI Property Management's rental and management of the parking bays did not affect its ownership rights over the parcels.

The court also dismissed allegations that the developer had breached the sale and purchase agreements by failing to provide sufficient visitor and disabled parking or the promised three-tier security system.

Justice Anand found that the development had more than 900 parking bays, exceeding the number required under the approved development orders, while the evidence also showed the security system had been provided and remained operational.

Counterclaim dismissed

TSI Property Management had counterclaimed against FRMC, alleging trespass after the MC padlocked the utility room and restricted access to the parking bays.

However, the judge found there was insufficient evidence to establish the alleged trespass and dismissed the counterclaim.

The court ordered FRMC to pay RM60,000 in costs to the defendants but made no costs order against the 94 individual purchasers.

For developers, MCs and parcel owners, the ruling underscores the importance of examining the official strata documents before asserting that parking bays, utility rooms or other facilities form part of the common property. Where those documents identify an area as an individual parcel or accessory parcel, courts are unlikely to reclassify it as common property in the absence of compelling evidence that the registration itself is legally defective.

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