BUILDING MAINTENANCE & STRATA MANAGEMENT ACT 2004
The Chairman - according to the Act the Chairman's duties are:
The Chairman or Chairperson by virtue of his or her position is the Chairman of the Council and also the Chairman of the management corporation. The Chairman presides over meetings. They command great respect in the management corporation and give advice or are consulted on matters affecting the management corporation. At times they are called upon to settle disputes or to rule on matters on whether a motion for discussion at a meeting is acceptable or not or deemed out of order. When votes are taken, the Chairperson declare the results of the voting that has taken by a show of hands. The Chairperson is normally assisted by the Secretary and the Treasurer.
Besides the Chairperson, the Secretary is an equally important person in the management corporation. Although most of the administrative and secretarial work are done by an agent. The following are the duties of the Secretary of the Management Corporation (MC):
In accordance to quote from Section 56 of the BMSMA Act 2004, the Duties of the Secretary of Council are:
Section 56. The duties of the secretary of the Council of a management corporation shall include the:
(a) to prepare and distribute minutes of meetings of the management corporation and submit a motion for confirmation of the minutes of any meeting of the management corporation at the next such meeting;
(b) to give notices on behalf of the management corporation and of the Council as required by the Act;
(c) to maintain the strata roll;
(d) to inspect documents on behalf of the management corporation in accordance with section 47;
(e) to answer communications addressed to the management corporation;
(f) to convene meetings of the Council and the management corporation; and
(g) to attend administrative or secretarial functions of the management corporation or the Council.
In accordance to quote from Section 57 of the BMSMA Act 2004, the Duties of the Treasurer of the Council are:
Section 57. (1) The duties of the treasurer of the Council of a management corporation shall:
(a) to notify subsidiary proprietors of any contributions levied in accordance with this Act;
(b) to receive, acknowledge, bank and account for any money paid to the management corporation;
(c) to prepare any certificate applied for under section 47 (1) (c); and
(d) to keep the accounting records and prepare the financial statements of the management corporation.
(2) A person shall not exercise or perform any of the powers, duties or functions of the management corporation or the treasurer of the management corporation, being powers, duties or functions relating to the receipt or expenditure of, or accounting for, moneys, or the keeping of the books of account, of the management corporation, unless he is -
(a) a subsidiary proprietor of the management corporation or a member of the Council and is the treasurer of the management corporation or of the Council;
(b) a managing agent who is empowered to exercise or perform those powers, duties or functions; or
(c) a person with whom the treasurer of the management corporation is required by an order of the Council to exercise or perform jointly those powers, duties or functions, and who is enabling the treasurer to comply with the order.
(3) The treasurer of a management corporation may delegate the exercise or performance of any of his powers (other than this power of delegation), duties or functions as treasurer, the delegation of which is specifically approved by the Council of the management corporation, to another member of the Council so approved, subject to such limitations as to time or otherwise as are so approved.
(4) While a delegate is acting in accordance with the terms of a delegation under subsection (3), he shall be deemed to be the treasurer of the management corporation.
(5) The Council of a management corporation may, by notice in writing served on the treasurer of the management corporation, order that he shall not exercise or perform any of his powers, duties or functions that are specified in the notice, unless he does so jointly with another person so specified.
The Use of Resolutions for Management Corporation to regulate the Common Property
There are 6 types of resolutions that the Management Corporation uses to manage and control the common property. The two commonly used resolutions are:
1. Ordinary Resolution
An Ordinary Resolution requires a notice of 14 days and decisions are made by a simple majority of 51% by show of hands or by ballot (poll)
For example you use an ordinary resolution to:
Appoint a Managing Agent - Section 66(1)
Delegate to MA the powers, duties and functions - Section 67 (3)
To remove a Council Member (CM) - Section 54(2) (b)
To delegate duties, powers and functions to an MA - Section 67(3)
By-law: Allow the owner to have exclusive of the common property for 1 year Section 33(1)(a)
2. Special Resolution
A Special Resolution requires a notice of 21 days and decisions are made by ballot and passed if more than 75% approval is achieved
Give rebates for early payment of contributions - Section 41(9)
Make improvements, provide additional facilities to the Common Property (CP) - Section 29(1)(d)
To pass additional By-laws is by Special Resolution - Section 32(3)
By-law: Allow the owner 1-3 yrs exclusive use of the Common Property - Section 33(1)(b)
Lease out Common Property for 1 to 3 years - Section 34(2)(a)
Recover from owner contributions in arrears through sale - Section 43(3)
The other 4 resolutions all require 21 day's notice and by ballot are:
3. New 90% Resolution
- Allow SP to increase their Gross Floor Area
- Allow SP exclusive use of CP for more than 3 years
- Lease or transfer Common Property for more than 3 years
4. Comprehensive Resolution
- Change of present MC to 2 Tier MC (Main & Sub-MC)
- Agree to dissolve the Sub-MC
- Alter Common Property boundary of MC & Sub-MC
- Use different formula to levy MF/SF when CP is altered
5. Resolution by Consensus
- Not to take up a damage insurance policy for the MC
- MC can be terminated by a Resolution by Consensus
- Use different method other than SV to levy contributions
6. Unanimous Resolution
- MC may give or accept a grant of easement or restrictive covenant on behalf of the owners
The Subsidiary Proprietor (SP) - You the Owner
Owner's (SPs) Responsibility and obligations -
(1) The Share Value of your lot determines how much maintenance fees called the Management Fund (MF) and Sinking Fund (SF) you pay which also determines your votes rights and the share or use of Common Property.
(2) You are to maintain your lot including the external windows of your Unit, resolve inter-floor leaks and comply with by-laws and notices.
Emphasis is put on the liability of falling external windows. Be Careful - Windows of a lot can be part of common property or part of a lot depending on how it is described in the strata title plan. To be safe, get insurance coverage to cover all external windows. Talk to your Management Corporation or your insurers on this and how your lot can be covered. Section 9 Unsafe exterior feature - $10,000 fine and 12 months jail.
Maintenance fees - It is the owners responsibility is to pay their monthly or quarterly maintenance fees in time so that the Management Corporation's common areas can be maintained. If your maintenance fees are in arrears, you cannot vote and you cannot be in the Council. Furthermore the Management Corporation after sending you reminders to pay, may take one or several of these actions against you to recover this debt:
(1) MC sends you a letter of demand for the arrears with late payment interests
(2) If that fails the MC can bring you to the small claims tribunal or engage a lawyer who will send you a letter of demand & this cost is recoverable from you
(3) MC's lawyer can bring you to court to recover Owings
(4) MC's lawyer can lodge an instrument of charge in favour of the Management Corporation
(5) Upon the registration of the instrument of charge and the registration with the Registrar of Titles, the Management Corporation has the power of sale of your property (although this rarely happens)
Renovation of your unit - depending on whether by-laws to collect renovation deposits has been passed, the Management Corporation will require you to pay a deposit to renovate your unit. In the event you or your contractor damages the common property or have not removed the debris from the common areas, this deposit can be utilised to defray these expenses. In addition a plan on the proposed renovation is to be submitted together with the deposit indicating whether walls are being removed or added on. Where load bearing walls are affected, a Professional Engineer's endorsement may be required before the commencement of the renovation work.
Maintaining your property - Inter-floor leaks When there is a leak between two floors, you and your neighbour is to jointly investigate to determine the cause of the leak and rectify it. The cost for the repairs should also be resolved between the two neighbours. It is presumed that the source of the leak is from the upper unit unless otherwise proven to be from another source like a downpipe, the roof or from an external wall.
When selling or buying strata titled property Often when one sells or a person buying a strata titled unit, the buyer's lawyer should find out whether the seller has any Owings of any contributions due to the Management Corporation. If there are, then between the buyer and the seller's lawyers, that amount owing to the Management Corporation has to be settled before the transaction of the sale is completed. That amount owing can be deducted from the selling price or paid directly by the seller to the Management Corporation before the completion of the sale. The Management Corporation will issue a Section 47(1)(c) certificate stating what is due from that unit. On completion, the registered SP shall within 10 days of the sale update the MC the name and address of the transferee in full.
Water Tank Security
A very recent development with Management Corporations is a new requirement to lock the accessibility to your estate's water tanks with locks that has non-duplicable keys. The control and movement of keys also requires monitoring. In addition, water tanks are to be secured with brackets that is tightened and secured by nuts using a wrench hook. These wrench hooks are not available in the market except from authorised contractors. This requirement became a necessity after an incident where unauthorised people where found meddling with water tanks of MCs. If your MC has not secured the water tank with brackets yet, call the utilities board and ask for an extension of the dateline.
The First Schedule of the Building Maintenance and Strata Management Act 2004 has provided some guidelines the way meetings are conducted for example paragraph 3. Quorum and paragraph 11 General meeting valid if attended only by chairperson:
Other aspects of the new Act
In accordance to quote from the First Schedule of the BMSMA Act 2004, the Quorum Paragraph 3. (1) No business shall be transacted at any general meeting of a management corporation or subsidiary management corporation unless a quorum of subsidiary proprietors is present.
(2) A quorum shall be formed at any general meeting of a management corporation or subsidiary management corporation constituted in respect of a strata title plan when the number of subsidiary proprietors who own at least --
(a) 30% of the aggregate share value for all lots comprised in that strata title plan; or
(b) in the case of a subsidiary management corporation constituted for any limited common property, 30% of the aggregate share value for all lots for whose exclusive benefit the limited common property are designated, are present at the meeting, either in person or by proxy.
(3) Subject to sub-paragraph (4), if within half an hour appointed for holding a general meeting of a management corporation or subsidiary management corporation, no quorum of subsidiary proprietors of the management corporation or (as the case may be) subsidiary management corporation is present, the general meeting may be held as if a quorum is present if there are 2 or more such subsidiary proprietors present in person.
(4) Sub-paragraph (3) shall not apply to a general meeting convened on receipt of a requisition by subsidiary proprietors.
In accordance to the First Schedule of the BMSMA Act 2004, General meetings valid if attended only by chairperson
Paragraph 11. A general meeting of a management corporation or (as the case may be) subsidiary management corporation shall, subject to paragraph 3, be validly held notwithstanding that the only person present at the meeting is the chairperson of the management corporation or subsidiary management corporation, as the case may be.
Council and Council Members
The minimum number of council members in a Council is 2 and the maximum number of council members is 14, all of which are to be natural persons (not companies) and are elected or appointed to be the chairperson, secretary, treasurer and council members of the Management Corporation. If there are only 2 council members the chairperson can be say the Chairman and Secretary and the other council member be the Treasurer but it would be best to avoid a council of 2 members for the sake of transparency and disputes.
A council member has to be a subsidiary proprietor of not less than 21 years of age, can be a nominee of a company which owns a lot or unit in the strata title development or is an immediate family member ("immediate family member", in relation to any person, means a spouse, child, adopted child, step-child, sibling or parent of that person) of the subsidiary proprietor and has settled all arrears to the Management Corporation at least 3 days before the Annual General Meeting to qualify for election into the Council.
Other salient features of the BUILDING MAINTENANCE & STRATA MANAGEMENT ACT 2004
1. MC to maintain a Strata Roll - (section 43). If an owner changes address, they have to inform MC within 10 days of the change of address or if they sell their unit (Section 65). Also if MC suspects somebody has sold their unit the MC can write to them and ask them to give the MC a notice to specify a transfer of property and the new owners particulars within 14 days. However if the seller do not inform the MC [eg by not requesting for a certificate under Section 47(1)(c) as required], the MC can serve a notice on them giving 14 days as to why they are not informing the MC and compel them to inform MC - Section 65(8).
2. Management Corporation is to ensure its address is to be displayed in the notice board and maintain a letterbox with its name shown on it for the service of notices. When an MC changes it address, the Registrar of Titles, Commissioner of Buildings, and all owners are to be informed within 7 days.
3. MC can register a charge against your property (or recover arrears through sale of your lot) and once the charge is filed, you cannot sell your unit until the charge is lifted by the MC.
4. An MC which carries on business without a Chairman, Secretary or Treasurer for more than 6 months, and knows that the MC is carrying on business in that manner, all those SPs shall be liable for the debts of the MC in that 6 months and can be sued for it - Section 55(6).
5. Book of accounts of MC to end not earlier than 4 months before each AGM. Example - if MC's accounts end in December, the AGM can be convened by end April instead of by end of March which was the previous rule before the new Act came into force.
6. MC can from time to time raise contributions to paint building but painting does not have to be done every 5 years.
7. All records of the MC are to be kept for at least 7 years - Section 48(2).