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2021 MarsdenLR 1570
HIGH COURT SABAH & SARAWAK KUCHING
LUXURY TARGET SDN BHD – Appellant
Versus
WISMA SABERKAS MANAGEMENT CORPORATION – Respondent
[Suit No: KCH-22NCvC-47/8-2019]
Management Corporations must fulfill statutory duties while property owners are obligated to pay corresponding fees; failure to do so leads to loss of claims.
Headnote:(A) Strata Titles Ordinance 1995 (Chapter 18) – Sections 26, 2 of the Third Schedule, and 8 of the Third Schedule – Management Corporation duties – Statutory duty owed by the Management Corporation to maintain common property not fulfilled, though efforts made were noted. (Paras 23-37)
(B) Service Charges – Obligation of property owners to pay for maintenance irrespective of dissatisfaction, and rights to recover outstanding fees upheld per Sarawak Strata Management Ordinance 2019. (Paras 24-45)
(C) Interest Charges – Right to impose interest on late payments confirmed through resolutions at annual meetings and relevant ordinances. (Paras 46-46)
Facts of the case: The Plaintiff, owning multiple lots in Wisma Saberkas, alleged deterioration of services by the Defendant, the Management Corporation, leading to financial loss from tenant departure and the withholding of maintenance fees since 2018. (Paras 3-8)
Findings of Court: The Plaintiff failed to convince the Court of the Defendant's breach of statutory duties, as maintenance was provided, although not fully meeting expectations. (Paras 22-32)
Issues: The key issues involved deteriorating conditions of the building, Defendant's statutory obligations, and the legitimacy of service charges and their breakdown. (Paras 11-42)
Ratio Decidendi: The Court ruled that both parties held statutory responsibilities in ensuring the upkeep of Wisma Saberkas and that the Plaintiff's claims were unfounded due to failure to pay the owed maintenance charge while still benefiting from communal services. (Paras 22-45)
Result: Plaintiff's claims dismissed with costs, and Defendant's counterclaims allowed. (Paras 47)
JUDGMENT
[1] This is a Writ of Summons case filed by the Plaintiff (in the Original action/Defendant in the Counter claim), for the followings:
(a) a declaration that the Defendant (in the original action/ Plaintiff in the Counter-claim) has breached its statutory duty as the Management Corporation of Wisma Saberkas;
(b) an order that the Defendant shall perform its statutory duty as the Management Corporation of Wisma Saberkas in accordance with the Strata Titles Ordinance 1995 (Chapter 18);
(c) an order that the Defendant shall rectify, restore and maintain the condition and facilities of Wisma Saberkas in tenantable condition;
(d) an order that the Defendant is to justify by giving particulars making up the rate of RM2.56 per share unit payable to the management fund within 7 days from the date of this Order;
(e) an order that the RM2.56 per share per unit charged to the unit owners and payable to the management fund shall be inclusive of, inter alia, running and/or operation charges of the centralized air conditioning including electricity charges for all of the Plaintiff's Lots within Wisma Saberkas;
(f) the sum of RM12,083,820.40, being loss of rental;
(g) all damages suffered by the Plaintiff, to be assessed by this Honourable Court;
(h) interest on paragraphs prayers (f) and (g) hereinabove, at the rate of 5% per annum from the date of Judgment until full and final settlement or at such rate and for such period as the Honourable Court thinks just and appropriate;
(i) Costs; and
(j) Such further or other reliefs as this Honourable Court deems fit and proper.
[2] The Defendant is making Counter-claims for the followings:
(a) Outstanding management fund (service charge) in the sum of RM1,136,302.80 as at 31 August 2019 and continuing thereafter until full settlement, and
(b) Interest at the rate of 10% per annum on late payment of management fund (service charge) on RM1,136,302.80 from the month of March 2018 to July 2019 in the sum of RM8,333.72 and continuing thereafter until full settlement, and
(c) Interest at the rate of 10% per annum on late payment of Management fund (service charge) from 1 September 2019 until full settlement, and
(d) Costs:
(i) Court fees............ RM400.00
(ii) Advocates Fees............ RM40,000.00
(iii) 6% SST on RM40,000.00...... RM2,400.00
(e) Any other relief which this Honourable Court deems fit and proper.
Background
[3] In year 2009, the Plaintiff had purchased 45 lots out of a total of 345 lots in Wisma Saberkas. The said 45 lots are LG.03, LG.08, LG.09, LG.10, LG10A, LG.12, LG.18B-20A, LG.21D, LG.21E, G.04, G.13, 1.03, 1.08, 1.10, 2.02A, 2.03, 2.05, 2.15A, 2.16, 2.27, 3.05, 3.06, 3.06A, 3.15, 3.27, 4.05B, 4.06, 4.07, 4.10, 4.12, 4.13, 4.14, 4.18A, 5.09, 5.11A, 5.21(A)&(B), 6.01, 8.01, 8.03, 8.05, 8.06, 8.07, 8.08, 8.10 and 8.111. The Plaintiff is one of the largest private owners in Wisma Saberkas of approximately 25%2 and contributes approximately 30% of the total management funds collected by the Defendant.
[4] At all material times between 2009 to 2015, most of the lots in Wisma Saberkas were tenanted and the Plaintiff had approximately 42 lots out of its 45 lots tenanted and/or occupied.
[5] On or about 2015, the condition and facilities of Wisma Saberkas started to deteriorate. These deterioration in the conditions and facilities of Wisma Saberkas are mainly in relation to:
(a) Air-conditioning;
(b) Lifts and escalators; and
(c) Water leakages and seepages into Wisma Saberkas.
[6] According to the Plaintiff, due to the Defendant's failure to respond or failure to respond promptly to the deteriorating condition and facilities of Wisma Saberkas, many tenants had quit their premises and the crowd of customers/shoppers coming to Wisma Saberkas became lesser.
[7] In desperation and in order to gain a response from the Defendant to the deteriorating condition and facilities of Wisma Saberkas, the Plaintiff who has always been a good paymaster had since March 2018 withheld its payment of the
