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Transcript of JMB_Act 663
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BUILDING AND COMMON
PROPERTY (MAINTENANCE ANDMANAGEMENT) ACT 2007
By
LEE SWEE SENG
Advocate & Solicitor
Certified Mediator
Notary Public
Patent Agent
www.leesweeseng.com
©copyright
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INTRODUCTION
Came into force on 12 April
2007.
It is an Act to provide for the
proper maintenance and
management of buildings and
common property, and for
matters incidental thereto.
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THE POSITION BEFORE THE ACT
The maintenance and management of building
housing two or more storeys and common
property was governed by the HousingDevelopment (Control and License) Act 1966 (Act
118) and the Strata Titles 1985 (Act 318).
The developer is responsible for the maintenance
and management of the common property before
the formation of the Management Corporation
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THE POSITION AFTER THE ACT
Section 4 of the Building and
Common Property (Management &
Maintenance) Act 2007 (BCP Act)
- A Joint Management Body that
comprises of the developer and the
purchasers are responsible to provide for the proper maintenance
and management of buildings and
common property, and for matters
incidental thereto
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JOINT MANAGEMENT BODY When is the JMB formed?
For development completed before 12th
April 2007, JMB must be formed before 12th April 2008 [Section 4(1)(a)]
For development completed on or after
12th
April 2007, JMB must be formednot later than 12 months from the date
of delivery of vacant possession
[Section 4(1)(b)]
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JOINT MANAGEMENT BODY
Jelutong MP Datuk Lee Kah Choon said the Actalso allowed for the setting up of the
commissioner of building (COB), headed by the president of the local council, to ensure that the joint management body was formed.
³COB and the joint management body are the
proper channels to which they can forward their complaints should they encounter managementand maintenance problems,´ he said.
Source: 07/05/2007 The Star By David Tan
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JOINT MANAGEMENT BODY
Section 6(1):-
d) the determination of the rate of interest
payable by a purchaser in respect of
late payment of charges; and
e) any matter connected with the
maintenance and management of the
common property of the building.
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JOINT MANAGEMENT BODY
The quorum at the first meeting of the Body shall beone-quarter of the purchasers who has paidmaintenance charges in respect of their parcels to theBuilding Maintenance Account (³members entitled
to vote´) of the developer [Section 6(2)
] If within half hour after the time appointed for themeeting, a quorum is not present, the member entitled to vote who are present shall constitute aquorum [Section 6(3)]
Joint purchasers shall not be entitled to vote except by way of a jointly appointed proxy [Section 6(5)]
In the event of an equality of votes, the chairmanshall have a casting vote [Section 6(6)]
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JOINT MANAGEMENT BODY
Section 8(1) of the Building andCommon Property (Management &Maintenance) Act 2007.
Duties of the Body:
a) To properly maintain the common property and keep it in a state of goodand serviceable repair;
b) To determine and impose charges thatare necessary for the repair and proper maintenance of the common property;
c) To insure and keep insured the building to the replacement value of the building against fire and suchother risks as may be determined by
the Body;
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JOINT MANAGEMENT BODY
Section 8(1)
d) To apply insurance moneys received by
the Body in respect of damage to the
building for the rebuilding and
reinstatement of that building;
e) To comply with any notices or orders
given or made by the local authority or
any competent public authority requiring
the abatement of any nuisance on thecommon property, or ordering repairs or
other work to be done in respect of the
common property or other improvements
to the property;
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JOINT MANAGEMENT BODY
Section 8(1)
f) To prepare and maintain a register of all purchasers of the building;
g) To ensure that the Building Maintenance fundis audited and to provide audited financialstatements for the information to the
purchasers;
h) To enforce house rules for the proper
maintenance and management of the buildings;and
i) To do such other things as may be expedient or necessary for the proper maintenance andmanagement of the building.
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JOINT MANAGEMENT BODY
Section 8(2) of the Building andCommon Property (Management& Maintenance) Act 2007.
The power of the Body shall
includea) To collect from the purchasers
maintenance and managementcharges in proportion to theallocated share units of their
respective parcels; b) To authorize expenditure for
the carrying out of themaintenance and managementof the common property.
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JOINT MANAGEMENT BODY
Section 8(2)
c) To recover from any purchaser any sum expended by the Body in respect of that parcel in complyingwith any such notices or orders as referred to
under paragraph (1)(e);d) To purchase, hire or otherwise acquire movable or
immoveable property for use by the purchasers inconnection with their enjoyment of the common
property;
e) To arrange and secure the services of any personor agent to undertake the maintenance and
management of the common property of the building;
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JOINT MANAGEMENT BODY
Section 8(2)
f) To make house rules for the proper
maintenance and management of the building; and
g) To do all things reasonably necessary for
the performance of its duties under this
Act.
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DISSOLUTION OF JOINT
MANAGEMENT BODY The Body shall be
dissolved 3 months
from the date of thefirst meeting of the
management
corporation for the
building [Section15(1)]
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DISSOLUTION OF JOINT
MANAGEMENT BODY Section 41 (Strata Titles Act 1985)
Duty of original proprietor to convene first annual generalmeeting.
1) It shall be the duty of the original proprietor to convene thefirst annual general meeting of the managementcorporation within 1 month after the expiration of theinitial period.
2) If the original proprietor fails to comply with subsection(1), he shall be guilty of an offence and shall be liable onconviction to a fine not exceeding RM25,000.00 and to afurther fine not exceeding RM2000 for each day theoffence continue to be committed.
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DISSOLUTION OF JOINT
MANAGEMENT BODY Section 2 (Strata Titles Act 1985)
³initial period´
± in relation to a management corporation, means the
period commencing on the day on which the
management corporation is formed and ending on the
day on which there are proprietors, excluding the
proprietor of the lot who is registered as a proprietor of a parcel or parcels or a provisional block or blocks the
sum of whose share units is at least one-quarter of the
aggregate share units.
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DISSOLUTION OF JOINT
MANAGEMENT BODY Section 15(2)
The Body shall-
a) Not later than 1 month from the date of the firstmeeting of the management corporation, hand over to
management corporation-
i. the house rules;
ii. the audited accounts of the BMF or, if suchaccounts have not been audited, the unaudited
accounts;iii. all assets and liabilities of the Body;
iv. records related to and necessary for themaintenance of the building and its common
property; and
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DISSOLUTION OF JOINT
MANAGEMENT BODY Section 15(2)
b) if only unaudited accounts have been handed
over under subparagraph (a) (ii); not later than
3 months from the date of the first meeting of
the management corporation, hand over to the
management corporation the audited accounts
of the Body.
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DISSOLUTION OF JOINT
MANAGEMENT BODY
If the Body fails to comply with this
section, every member of the Bodycommits an offence and shall, on
conviction, be liable to a fine not
exceeding RM10 000; AND
Shall also be liable to a further fine
not exceeding RM1000 for every day
during which the offence is continued
after conviction [Section 15(3)]
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DISSOLUTION OF JOINT
MANAGEMENT BODY
Section 15(4)
EXCEPTION:
± Where an offence under this section has been
committed by the Body, every member of the Bodyshall be deemed to have also committed that offence
unless, having regard to all the circumstances, he
proves-
a) that the offence was committed without hisknowledge, consent or connivance; and
b) that he had taken all reasonable precautions and had
exercised due diligence to prevent the commission of
the offence.
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JOINT MANAGEMENT
COMMITTEE
Section 11(1):-
Joint Management
Committee may perform the
Body¶s duties and conduct
the Body¶s business on its
behalf, and may for that purpose exercise any of the
Body¶s power.
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JOINT MANAGEMENT
COMMITTEE Section 11(2):-
The committee shall consist of;
± the developer
± not less than 5 and not more than 12 purchasers
who shall be elected at the annual general
meeting of the Body and shall hold office for a
period not exceeding 3 years or until thedissolution of the Body in accordance with
Section 15, whichever earlier.
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JOINT MANAGEMENT
COMMITTEE Section 11(3)
From among the members of the Committee
elected under subsection (2), there shall beelected a chairman, a secretary and atreasurer.
Section 11(4) The provision of the First Schedule shall
apply to the Committee.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)] Times and places of meetings.
- The Committee is to hold as many meetings as are
necessary for the efficient performance of its functions.
- The meetings are to be held at such places and times as
the chairman may decide.
- BUT, the chairman shall not allow more than 2 monthsto lapse between meetings.
- The chairman shall call for a meeting if requested to do
so in writing by the Commissioner/ by at least 2
members of the Committee.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Quorum
- The chairman and at least half of
the members of the Committee
shall form a quorum at anymeeting of the Committee.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Casting vote.
- If on any question to be determined by the
Committee there is an equality of votes, the
chairman shall have a vote in addition to hisdeliberative vote.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Committee may invite others to meetings.- The Committee may invite any person to attend
any meeting or deliberation of the Committee for
the purpose of advising or assisting the Committee
on any matter under discussion, BUT any person
so attending shall have no right to vote at the
meeting or deliberation.
- Person invited shall be paid allowances.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Resolution of the Committee.
- A resolution is taken to have been passedat a meeting of the Committee if:
a) all members of the Committee have beeninformed of the proposed resolution in writing,
or reasonable efforts have been made to informall members of the Committee of the proposedresolution; and
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
b) the resolution in writing is signed by every member of
the Committee indication agreement with the resolution,
and in the absence of such agreement by every member of
the Committee, a meeting has to be held.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Minutes.- The secretary of the Committee shall causeminutes of all their meetings to be maintained andkept in a proper form.
- Minutes of meetings of the Committee, if dulysigned, shall be admissible in any legal proceedingsas a prima facie evidence of the facts stated in themwithout proof.
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JOINT MANAGEMENT
COMMITTEE FIRST SCHEDULE
[subsection 11(4)]
Minutes.- Every meeting of the Committee in respect of the proceedings of which minutes have been so madeshall be deemed to have been duly convened and
held and all members at the meeting to have beenduly qualified to act.
- A Committee shall cause copies of the minutesof all its meetings to be submitted to the
Commissioner as soon as practicable.
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JOINT MANAGEMENT
COMMITTEE FIRST SCHEDULE
[subsection 11(4)]
Procedure
- The Committee may regulate its own
procedure.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Disclosure of interest.- A member of the Committee having any interest in any
matter under discussion by the Committee shall disclose tothe Committee the facts of his interest and its nature.
- A disclosure shall be recorded in the minutes of theCommittee and, after the disclosure, the member having aninterest in the matter shall not take part nor present in anydeliberation or decision of the Committee.
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JOINT MANAGEMENT
COMMITTEE
FIRST SCHEDULE
[subsection 11(4)]
Validity of acts and proceedings.
- No act done or proceeding taken under this Act shall
be questioned on the ground of:
a. any vacancy in the membership of, or any defect in
the constitution of, the Committee;
b. contravention by any member of the Committee; or
c. any omission, defect or irregularity not affecting themerits of the case.
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JOINT MANAGEMENT
COMMITTEE FIRST SCHEDULE
[subsection 11(4)]
Members to devote time to business of Committee.
- The members of the Committee shalldevote such time to the business of theCommittee as is necessary to discharge their duties effectively.
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RIGHT OF PURCHASER Section 13
On application by or on behalf of a person who
is a purchaser, or by or on behalf of a personwho is a prospective purchaser, the Body shall
issue to that person a certificate certifying-
a) the amount of charges payable by a purchaser;
b) the time and manner of payment of the amount of
charges;
c) the extent, if any, to which the charges have been
paid;
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RIGHT OF PURCHASER
d) the amount, if any, then recoverable by the Body in
respect of the parcel;
e) the sum standing to the credit of the BMF and the
sum in the account that has been committed or
reserved for expenses already incurred by the Body;
f) the nature of the repairs and estimated expenditure, if
any, where the Body has incurred any expenditure or
is about to perform any repairs, work or act in respect
of which a liability is likely to be incurred by the
purchaser of the parcel under any provision of thisAct; and
g) the amount paid and to be paid by the developer for
unsold parcel.
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BUILDING MAINTENANCE
ACCOUNT Section 16(1)
± Developer to open and maintain Building
Maintenance Account. The Building Maintenance Account shall
be opened in the name of the development
area with a bank or financial institution
licensed under Banking and Financial
Institutions Act 1989 or regulated by the
Central Bank under any other written law.
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BUILDING MAINTENANCE
ACCOUNT One Building Maintenance
Account shall be opened for
each development area[Section 16(2)]
The Account shall be
maintained by developer until
the establishment of the Bodyfor the building [Section
16(3)]
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BUILDING MAINTENANCE
ACCOUNT
The developer shall not open and maintain a
Building Maintenance Account together with any other building outside the
development area.[Section 16(4)]
The Commissioner may resolve the disputearise in respect of the Account as he deem
fit and just.[Section 16(5)]
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BUILDING MAINTENANCE
ACCOUNT
Section 17
± Duties of developer as to Building Maintenance
Account.
Section 17(1)
A developer shall deposit into the Building
Maintenance Account-
a) all charges received by him from the purchasers in thedevelopment area for the maintenance and
management of the common property of the
development area; and
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BUILDING MAINTENANCE
ACCOUNT
Section 17(1)
b) all charges for the maintenance andmanagement of the common property to be paid by the developer in respect of those parcels in the development areawhich has not been sold, being a sum
equivalent to the maintenance charges payable by the purchasers to thedeveloper had the parcels been sold.
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BUILDING MAINTENANCE
ACCOUNT Section 17(2)
The developer shall-
a) cause proper accounts of the Building
Maintenance Account to be kept inrespect of all sums of money receivedfrom and all payments made out of the Account;
b) appoint a professional auditor to
audit the Account annually or in thecase of where money to betransferred under subsection 19(3), 1month before the date of actualtransfer;
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BUILDING MAINTENANCE
ACCOUNT Section 17(2)
c) file with the Commissioner a copy of the
statement of accounts certified by the auditorsand a copy of the auditor¶s report within 14
days of the accounts being audited; and
d) permit the Commissioner or any person
authorized by the Commissioner in writing to
act on its behalf full and free access to the
accounting and other records of the Building
Maintenance Account and to make copies or
extracts of those accounting or other records.
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BUILDING MAINTENANCE
ACCOUNT
Section 19
Moneys not to form
part of the property
of the developer.
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BUILDING MAINTENANCE
ACCOUNT Section 19(1)
All money in the Building Maintenance
Account shall not be deemed to for part of the property of the developer in the event-
a) the developer enters into any composition or
arrangement with his creditors or has a receiving
order or an adjudication order made against him; or b) The developer, being a company, goes into
voluntary or compulsory liquidation.
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When must BMA be opened?
S 16(1)
Development that is completed after April12, 2007;
± the developer must open a BMA in the name of the development area, before delivery of vacant possession to the purchasers.
± each development area shall have a separate
BMA. The developer shall deposit into theBMA, all charges received from purchasers,and all charges for unsold units.
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When must BMA be opened?
Development completed before April 12,
2007;
± the developer has immediately before that day
been collecting charges for maintenance from
purchasers, the developer may continue to do so
until the JMB is formed. It would appear that a
BMA has to be opened forthwith.
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BUILDING MAINTENANCE
FUND Section 22(1);
Any surplus moneys in the Building
Maintenance Account after paymentof all expenditure which have been
properly charged to the Building
Maintenance Account shall be
transferred to the Body by thedeveloper.
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BUILDING MAINTENANCE
FUND
Section 22(1)
It must be transferred not later than 1 monthfrom the date of the establishment of the
Body, and such moneys shall constitute a
fund to be known as the ³Building
Maintenance Fund´ which shall bemaintained by the Body.
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BUILDING MAINTENANCE
FUND Section 22(2)
The Building Maintenance Fund shall be
administered and controlled by the Body andshall consist of-
a) all or any part of the maintenance charges for the building imposed by or payable to the Body under this Act;
b) All moneys derived from the sale, disposal, lease or hire of, or any other dealing with, any property,mortgages, charges or debentures vested in or acquired by the Body;
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BUILDING MAINTENANCE
FUND
Section 22(2)
c)all other moneys and property whichmay in any manner become payableto or vested in the Body in respect of any matter incidental to its functionsand powers; and
d) all other moneys lawfully receiver by the Body, including interest,donation and trust.
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BUILDING MAINTENANCE
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BUILDING MAINTENANCE
FUND
Section 22(3)
d) carrying out periodical inspection on the safetyof the building in the manner as specified in and
under the Street, Drainage and Building Act 1974;e) cleaning premises including white-washing,colour washing or painting of the common property;
f) carrying out inspection of all electrical wiringsystems of the common property and replacingany faulty wiring systems, if any;
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BUILDING MAINTENANCE
FUND
Section 22(3)
k) paying the remuneration or fees of the
managing agent appointed under section 25;
l) paying any expenditure lawfully incurred by the
Body;
m) paying for the allowances and other expenses
of the members of the Body and member of theCommittee according to such rates as may be
approved by the Commissioner;
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BUILDING MAINTENANCE
FUND Section 22(3)
n) paying any expenses, costs or expenditure in
relation to the procurement of goods or services;
o) purchasing or hiring equipment, machinery and
any other material, acquiring land and any assets,
and erecting buildings, and carrying out any other
works and undertaking in the performance of the
Body¶s functions and the exercise of its powers
under this Act;
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BUILDING MAINTENANCE
FUND Section 22(3)
p) paying any expenses for carrying
into effect the provisions of this Act;and
q) doing generally all things
necessary for the maintenance and
management of the common
property.
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What is the difference between
BMA and BMF?
The BMA is an account operated for the
maintenance of a building by the developer
before the JMB is formed. When the JMB isformed, surplus moneys in the BMA shall
be transferred to the BMF which shall be
maintained, administered and controlled bythe JMB.
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MAINTENANCE CHARGES
Any written notice served on the purchaser
requesting for the payment of the charges
shall be supported by a statement of thecharges issued by the developer or Body
[Section 23(3)]
The purchaser shall, within 14 days of receiving a notice , pay the charges
requested for [Section 23(4)]
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MAINTENANCE CHARGES
If the charges remain unpaid by the
purchaser at the expiration of the period of
14 days, the purchaser shall pay interest atthe rate to be determined by the Body but
such interest shall not exceed 10% per
annum [Section 23(5)]
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MAINTENANCE CHARGES
Schedule H of the Housing Development(Control and Licensing) Regulations.
Regulation 19(1) ± The Purchaser shall be liable for and shall pay
the service charges for the maintenance andmanagement of the common property and for
the services provided by the Vendor prior to theestablishment of a management corporationunder the Strata Titles Act 1985.
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MAINTENANCE CHARGES
Regulation 19(2) ± From the date the Purchaser takes vacant possession of
the said Parcel, the Purchaser shall pay a fair and justifiable proportion of the costs and expenses for themaintenance and management of the common property
and for the services provided. Such amount payableshall be determined according to the provisional shareunits assigned to the said Parcel by the Vendor¶slicensed land surveyors
± The amount determined shall be the amount sufficient
for the actual maintenance and management of thecommon property. The Purchaser shall pay one (1)month¶s deposit and three (3) months¶ advance inrespect of the service charges and any paymentthereafter shall be payable monthly in advance.
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MAINTENANCE CHARGES
Regulation 19(3)
- Every written notice to the Purchaser requesting for the payment of service charges from the Vendor shall besupported by a service charge statement issued by theVendor
Regulation 19(4)
- The service charge payable shall be paid within seven (7)days of the receipt by the Purchaser of the Vendor¶swritten notice requesting the same. If the service charge
shall remain unpaid by the Purchaser at the expiration of the said period of seven (7) days, interest on the servicecharge shall commence immediately thereafter and be
payable by the Purchaser, such interest to be calculatedfrom day to day at the rate of ten per centum (10%) per
annum.
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MAINTENANCE CHARGES
Settle your maintenance charges or risk having your assetssealed.
Owners and tenants of units in high-rise buildings such as
condominiums, office buildings and shopping centres were
given this warning yesterday by the secretary-general of the Ministry of Housing and Local Government, Datuk
Ahmad Fuad Ismail.
The assets would be sealed if the Commissioner of
Buildings (COB) appointed by the state governments gave
the permission after receiving an application from the
developer of a building, he said.
Sources: 15/04/2007 Sunday Times
MAINTENANCE CHARGES
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MAINTENANCE CHARGES
Under the new Act, owners must pay their charges within14 days of the first notice and if they fail to do so evenafter the second notice, they can be taken to court.
Both the owner and tenant must also make sure they areregistered with their respective management bodies.
A warrant of attachment will only be served as a lastresort.
These amendments are made to ensure that the entire
housing industry functions effectively without any hiccupson the part of the developer or dwellers.
Source: 22/04/2007 New Straits Times
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SINKING FUND
Section 24
Joint management Body to open and maintain
sinking fund.
± The Body shall open and maintain a sinking fund intowhich shall be paid such portion of the contribution
to the BMF as may, from time to time, be determined
by the Body for the purposes of meeting its actual or
expected liabilities in respect of the following:
a) the painting or repainting of any part of the common
property;
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SINKING FUND
Section 24
b) the acquisition of any movable property for use in
relation to the common property;
c) the renewal or replacement of any fixture or fittingcomprised in any common property; or
d) any other expenditure as the Committee deems
necessary.
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SINKING FUND
Schedule H of the Housing Development(Control and Licensing) Regulations.
Regulation 20(1) ± The Vendor shall, upon the date the Purchaser takesvacant possession of the said Parcel, open andmaintain separate sinking fund for the purposes of meeting the actual or expected liabilities in respect of
the following matters-a) The painting and repainting of any part of the
common property;
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SINKING FUND
Schedule H of the Housing Development
(Control and Licensing) Regulations.
Regulation 20(1) b) the acquisition of any movable property for use in
relation with the common property; or
c) the renewal or replacement of any fixture or fitting
comprised in the common property.
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SINKING FUND
Schedule H of the Housing Development (Control
and Licensing) Regulations.
Regulation 20(2) ± The Purchaser shall, upon the date he takes vacant
possession of the said Parcel contribute to the sinking
fund an amount equivalent to ten per centum (10%) of
the service charges.
± The contribution shall be payable monthly in advance.
± All funds accumulated in the sinking fund shall be held
by the Vendor in trust for the Purchaser.
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Non- application of other written
laws, contracts and deeds Section 44
On the coming into operation of this Act, in a
local authority area or part of a local authority areaor in any other area, the provisions of any written
law, contracts and deeds relating to the
maintenance and management of buildings and
common property in as far as they are contrary tothe provisions of this Act shall cease to have effect
within the local authority area or that other area.
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CONCLUSION
The BCP Act is aimed at plugging loopholes andgrey areas not covered by the Strata Titles Act1985 and the Housing Development (Control and
Licensing) Act 1966. Under the BCP Act, the roles of the developers
and purchasers are more clearly defined and threenew bodies are introduced to implement proper building maintenance and management, namely
the Commissioner of Buildings (COB), JointManagement Body (JMB) and Joint ManagementCommittee (JMC).