THE Malaysian government established the Strata Management Tribunal (SMT) in 2013 in response to increased strata title disputes and to enhance the management of strata properties (ie properties in a multistorey building). The SMT is promoted as a quicker, cheaper and less adversarial method of resolving disputes compared with the formal judiciary system.
However, the operation of the SMT has inherent issues that affect its effectiveness in the long run, such as hindrances posed by the nature of the negotiation process, the lack of manpower and resources, the method of notice service and an overlapping legal framework.
Systemic issues in the body of strata law need to be addressed to deal effectively with complaints of unprofessionalism and a lack of integrity among property building managers and the standards of conduct of those on strata management committees.
There are cases where developers, while in control as the management body or as part of the joint management body, have engaged in mismanagement and fraudulent dealings, often creating strife in strata communities.
It is not unheard of to hear appalling anecdotes of non-compliance with building regulations, unsafe structures, purchasers not getting their LAD (liquidated ascertained damages, imposed when a developer fails to deliver a property on time), or property defects repaired improperly by the developer and, in some instances, management bodies and developers engaging in bullying.
An award by the SMT is not a consolation for long-suffering property buyers as their award is bound to be hit with a judicial review by developers via the courts to strike down the tribunal award.
This is a severe injustice for the buyer as he or she now has to search for funds to engage a lawyer, whose fees can go upwards from RM10,000, to defend the tribunal’s award. Intimidated by the legal process and by professional and court fees, the property owner may just abandon the tribunal award or settle for a less than reasonable compensation just so the developer will withdraw the judicial review.
The Strata Management Act 2013 prescribes high-level principles but makes no provision for the content of law that compels realistic practices. Reform of the SMT is due to give enforceable rights to homeowners and enhance claims awards in line with current market rates and a realistic valuation of the cost of work.
For example, broken floor tiles may cost around, say, RM1,000 to replace and to engage a contractor to do the work. But if the SMT only awards the cost of the broken tiles, the property owner would suffer an injustice in having to bear the cost of workmanship. In another example, interpreting or determining what constitutes “common property” has proven to be a complicated exercise even for expert legal counsels and property managers.
Good intentions are meaningless unless they are followed up by good action so homeowners can access substantive justice.
The Strata Management Act 2013 needs to be interpreted well and there is a need for competent experts to be roped in to assist or to provide input to the SMT on enforceable standards and realistic valuation of awards to bring more positive change in the strata management process in Malaysia.
To achieve this objective, I urge the Housing and Local Government Ministry to take the lead and institute urgent engagement with competent agencies and persons to strengthen the SMT.
