Management bodies and how they function

Strata management issues run the gamut of community living, from the sharing of common property, to pooling of financial resources for the maintenance of the subdivided building and common property, to getting volunteers to be part of the management team.

Many stakeholders are involved in strata management — developers, parcel owners, property managers, service contractors, real estate agents, land surveyors and the government. Each has an important function to ensure effective and successful strata management.

Strata living is challenging, what more strata management. Some owners may be disgruntled over the amount of the maintenance fees they have to pay while others may have an axe to grind with their elected management committee members. And if the strata building is not maintained according to the parcel owners’ demands and expectations, the committee will not hear the end of it.

What is JMB/ MC?
Parliament had in 2012 passed the Strata Management Bill which led to the implementation of the Strata Management Act, 2013 (SMA) Act 757 from June 1, 2015.

The SMA states that the Joint Management Body (JMB) and Management Corporation (MC) are statutory bodies that are formed to manage and maintain the subdivided building and common property in a strata development.

The JMB is formed when the MC is not formed yet. The MC is formed after the original proprietor of the land, who is normally the developer, successfully applies for subdivision of the building and the land office issues the strata titles for the respective parcels in the building. 

The JMB/MC is a corporate body and hence it can sue and be sued. The corporate body has “perpetual succession” which means the entity exists forever until it is dissolved.

The difference between the JMB and MC is in their composition. While the JMB comprises the developer and purchasers of the building parcels, the MC comprises initially, the original proprietor of the land on which the strata development stands, which is normally the developer and subsequently, the purchasers once they have received their strata titles and registered themselves as parcel owners.

What is a management committee?
The JMB/MC is run by a joint management committee (JMC) or management committee, respectively. The committee members are elected at the JMB’s/MC’s annual general meeting (AGM) and the number of JMC or management committee members should be between three and 14 parcel owners.

The committee acts in the interest and benefit of parcel owners living in the same strata community. Thus the committee ought to refrain from acting on its own whims and fancies. More importantly, it must refrain from mismanaging the monies collected from parcel owners for the maintenance and management of the strata development.

If the JMC or management committee acts in a manner detrimental to the general interest of the parcel owners, it could be liable to the JMB/MC respectively for damages sustained by the JMB/MC.

Eligibility
Each member of the JMC or management committee must uphold integrity. The SMA provides a comprehensive list of conditions that a committee member must meet.

First, to be eligible for election as a committee member, the parcel owner must be at least 21 years old and have fully paid his arrears in maintenance charges and sinking fund at least seven days before the AGM. A proxy is not allowed for the election of a committee member.

Second, a committee member must observe the following conditions:

• (a) Not a bankrupt;
• (b) A parcel owner;
• (c) Not convicted for an offence of fraud or dishonesty;
• (d) Be of sound mind or is capable of discharging his duties;
• (e) Must not bring discredit to the JMC or management committee while conducting his duties;
• (f) If he is the chairman, he must not absent himself from three consecutive committee meetings without the leave of the JMC or management committee;
• (g) If he is not the chairman, he must not absent himself from three consecutive committee meetings without the leave of the chairman;
• (h) He must not be in arrears of the maintenance charge and sinking fund (including interest) for three consecutive months;
• (i) If he commits a serious breach of by-laws, he must remedy the breach within 14 days of a notice from the JMC or management committee.

If the parcel owner fails to observe the above conditions, he is deemed to have vacated his office as a committee member. Consequently, the JMB or management committee may appoint another parcel owner to replace the member.

A committee member may resign from his office at any time by giving written notice to the JMB/MC.

The above provisions are just a few among the many comprehensive provisions in the SMA.

Datuk Chang Kim Loong is the Hon. Secretary-General of the National House Buyers Association (HBA). 
HBA can be contacted at: 
Email: [email protected]
Website: www.hba.org.my 
Tel: +6012 334 5676

This story first appeared in the EdgeProp.my pullout on April 12, 2019. You can access back issues here.