Strata Condominium Disputes and How to Make a Claim at the Tribunal in Malaysia

Written by: Sr KC Law

While living in a condominium has its advantages, such as having cool facilities to use, it surely has its disadvantages.

The below 2 situations may sound familiar to you-

The occurrence of water leakages from your upstairs neighbour’s washroom causing your condo ceiling to have yellow patches. Usually, the lower floor strata owner will make a complaint to the condo management. After doing a site inspection, condo management will inform and request the upper strata owner responsible to rectify the leakages/defects. To solve this issue amicably, you would require your upstairs neighbour to be cooperative in acknowledging that the source of the problem is from their unit and then agreeing to fix it. But what happens if they are uncooperative?

How to Find a Water Leak Inside the Wall: 6 Quick Steps

What about the issue of owners defaulting on their monthly maintenance fees and sinking fund in spite of multiple reminders, causing poor upkeep of the condo due to insufficient funds. What can the condo management do about these defaulting owners?

We understand that such situations might cause some to be at their wit’s end, not knowing what they can do.

Frustrated with your upstairs neighbour. Stock Video  © khosrork #331443664

Today, we would like to share a simple and practical guide on how you can resolve these kinds of issues in a cost-effective manner through what’s called the Strata Management Tribunal (SMT) – oh, and it does not involve hiring a lawyer.

Scarcity of land in the Klang Valley has brought about a boom in high rise developments both commercial and residential. These developments are called “strata properties” because they are built on a parcel of land (Master Title) which is later subdivided into individual strata titles for each respective strata owner.

Before we go into how to file a case with the tribunal, let me introduce the two Strata Laws that govern Strata properties in Malaysia:

(1) Strata Titles Act 1985 (Act 318) amended in 2013 (vide Act A1450)

(2) Strata Management Act 2013 (SMA) (Act 757) (repeal from Building & Common Property (Maintenance & Management) Act 2007 (referred to as Act 663).

The Strata Management Act 2013 (SMA) was enforced on 1 June 2015 and under this act, we have two regulations which are:

(1) Strata Management (Maintenance and Management) Regulations 2015 (SMR)

(2) Strata Management (Strata Management Tribunal) Regulations 2015 (SMT). This is the piece of regulation that we will be zeroing in.

*SMA is only applicable to Peninsular Malaysia. In Sarawak, it is governed by the Sarawak Strata Titles Ordinance 1974 and in Sabah, it is governed by the Sabah Land (Subsidiary Title) Enactment 1972.

Based on the SMA and its regulations, strata properties that do not come with strata titles during vacant possession are managed in 3 stages:

Stage 1- Management by the developer. The developer will initially manage the common properties after vacant possession of parcel to strata owners.

Stage 2- Management by a Joint Management Body (JMB). Strata owners and the developer jointly manage the common properties via a JMB established after the first annual general meeting (AGM) of the JMB.

Stage 3- Management by a Management Corporation (MC). Once the strata title has been issued, the JMB will transfer management of common properties to an MC after the first AGM of the MC.

On the other hand, for new strata properties that come with strata titles upon vacant possession, management is from stage 1 and then directly to stage 3, i.e. first by the developer and subsequently by the MC.

Now, going back to the 2 issues I’ve highlighted at the start, 1-Inter-floor leakages between two strata units. and 2- JMB/MC having to deal with defaulters not paying/owing maintenance charges and sinking fund.

Before 1 June 2015, cases like these had to be filed in court in order to resolve them. This would incur high legal charges to JMB/MC and strata owners and therefore many cases remain unresolved. 

After 1 June 2015, the enforcement of the Strata Management Tribunal Regulation 2015 (SMT) or Tribunal Pengurusan Strata (TPS) by the Housing and Local Government Ministry (Kementerian Perumahan dan Kerajaan Tempatan) (KPKT) provided an efficient and cost-effective solution in resolving disputes between strata owners, JMB/MC, developer and other stakeholders.

And yes, no lawyer is needed for SMT cases, because section 110 of the Strata Management Act 2013 (SMA) states that no party shall be represented by a lawyer unless there are complex legal issues which would require any party to have one. The maximum claims limit in SMT cases is up to RM 250,000. Not bad at all right?

The following are steps in filing for Strata Management Tribunal (SMT).

  1. Claimant/(Penuntut): Download and fill up 4 copies of Form 1/Borang 1 (Statement of claims) clearly, precisely and accurately with sufficient facts and evidence attached; together with a filing fee of RM100 for residential claims and RM200 for commercial/industrial claims and submit to KPKT. The 4 copies of Form 1 will be signed and sealed by the Secretary of the Tribunal on the same day. 

*Addresses for SMT filing are:

Central zone – No. 51, Persiaran Perdana, 62100 Presint 4, Putrajaya, 62100 Putrajaya (Level 1)

North zone – Aras 7, Zon B Wisma Persekutuan, Seberang Perai Utara,13200 Jalan Bertam,Kepala Batas, Pulau Pinang

South Zone – Tingkat 20, Menara Ansar, No.65, Jalan Trus,80000 Johor Bahru,Johor.

East Zone – Tingkat 5-6, Bangunan Darul Takaful (Maidam), Jalan Sultan Ismail, 20200 Kuala Terengganu,Terengganu

  1. Claimant/(Penuntut) must serve 1 copy of Form 1/Borang 1 (Statement of claims) attached with Form 2 (Statement of defence and counterclaim) and Form 4 (notice of hearing) with the date, time and venue of the hearing to the Respondent/(Penentang) within 14 days of the filing date.
  2. Respondent/(Penentang) can file a defence using Form 2 (Statement of defence and counterclaim) within 14 days after receiving Form 1 (Statement of claims) from Claimant at KPKT. The filing fee is the same paid by the claimant.
  3. Should the Claimant disagree with the respondent’s Form 2 (Statement of defence and counterclaim), the claimant can file using Form 3 (Defence to Counterclaim) to counter the respondent’s statement with a filing fee of RM50 for residential claims and RM100 for commercial/industrial claims at KPKT.

On the hearing date, both parties must appear before the President of the Tribunal at Level 4 of KPKT Putrajaya (for the central zone). Both parties will present oral arguments and documented pieces of evidence relevant to the case.

Once the hearing is over, the tribunal will make an award based on the pieces of evidence. Awards and settlements are recorded in writing in Form 6 (Award by Consent). Failure to comply with the award decided by the Tribunal is a criminal offence and one can be fined up to RM250K or jailed up to 3 years or both according to Section 123 of the SMA 2013.

The Strata Management Tribunal (SMT) since 2015 have successfully provided a cost-effective and practical solution in resolving disputes between strata owners, JMB/MC, developers and other stakeholders. For additional info please refer to https://www.kpkt.gov.my/index.php/pages/view/423

Hope all things will work in your favour, all the best with your case!

Share this information if this has been helpful.

Sr. KC Law

Sr. KC Law is a Registered Valuer, Estate Agent and Property Manager with The Board of Valuers, Appraisers, Estate Agents and Property Managers (BOVEAP) of Malaysia. KC Law is also an electronic engineer registered with the Board of Engineer Malaysia (BEM) and received his engineering training from Tunku Abdul Rahman College Malaysia and later at Hatfield Polytechnic United Kingdom. In the 1990’s he was involved with the digital transformation of Telecommunication infrastructure for Maxis and Telekom Malaysia. His passion for Real Estate in the 2000s led him to practice as a real estate negotiator in Ace Realty and later valuation and property management in Rahim & Co International. Several years later he founded Action Real Estate and Action Valuers & Property Consultants. His areas of expertise are in Real Estate Agency, Property Valuation, Property Management and Business Valuation. He is Member of The International Association of Certified Valuation Specialists of Canada, Member of Royal Institution of Surveyors Malaysia, Member of Malaysia Institute of Estate Agents, Member of Business Valuers Association of Malaysia and Member of Malaysian Institute of Property and Facility Managers.