Top 3 Popular FAQ about Arrears and Outstanding Fees in Strata Management

Recovery proceeding should start early and not allow arrears and outstanding debt to accumulate to several months.

Recovery proceeding as set out in Section 78, SMA are:
The committee member of Management Body to issue the notice of demanding payment of the sum due within the period as may be specified in the notice which shall not be less than 2 weeks from the date of service of the notice. If any sum remains unpaid at the end of the period specified in the notice, the committee members may file a summons or claim in a court of competent jurisdiction or before the Tribunal for the recovery of the said sum. The committee member may also make an application in writing to COB to recover the sums by attachment of movable property.

While the Management Body is recovering the arrears sum due, following actions can be taken as stated in the Third Schedule (By-laws) Paragraph 6 of SMR:
The defaulter shall pay interest at the rate of 10% per annum on a daily basis or at such rate as shall be determined by the Management Body at a general meeting, until the date of actual payment of the sum due.

The Management Body may prepare a defaulter’s list showing the names of the defaulting proprietors, their respective parcels and the amount of the arrears and sum that remains unpaid, and may display the list on the notice boards in the building provided that such list shall be updated by the Management Body at the end of every following calendar month.

The Management Body may deactivate any electromagnetic access device issued to a defaulter until that the any arrears or remaining sum has been fully paid, together with a charge not exceeding RM50 that may be imposed by the Management Body for the reactivation of his electromagnetic access device. During the period of deactivation, the Management Body may require the defaulter to sign in a defaulter’s register book each time that the defaulter requires any assistance for entry into or exit from the building or the development area.

The Management Body may stop or suspend a defaulter from using the common facilities or common services provided by the Management Body.

The Management Body may enter into any instalment payment scheme in writing with a defaulter to enable the defaulter to settle his outstanding sum.

The Management Body may accept payment of any sum due by a defaulter which is made by his charge, assignees, successor-in-title, lessee, tenant or occupier, and any of the aforesaid persons who had made such payment shall be deemed to be irrevocable authorized by the defaulter to do so.

The recovery of sums by attachment of movable property is well spelled out in Regulation 35 of SMR.

To apply for a warrant of attachment in Form A under subsections 35(1) or 79(1) of the Act, the developer, any member of the joint management committee, any member of the management committee, any member of the subsidiary management committee or any managing agent appointed by the Commissioner under subsection 86(1) or 91(3) of the Act, as the case may be, shall submit a sworn application in Form 21.

Developer must take stern action during Developer’s Management Period as provided for by the By-laws including to file the claim at the Strata Management Tribunal.

For absentee foreign owners, Developer or management body may locate the owner by referring to the register of parcel owners (to be maintained by the developer during Developer’s Management Period or to be maintained by JMB during the JMB period) or strata roll (to be maintained by MC during the MC period), which containing the particulars of all parcels in the development area including the details of solicitor acting for the SPA [Section 30(1) and Section 72(1), SMA]. Developer/JMB/MC can recover charges from the tenants (refer Section 79(5), SMA).