The management corporation must levy contributions based on share units as per the Strata Titles Act, and any contract conflicting with statutory requirements is void.

[1] This is the appellant's ("the defendant") appeal against the decision of the High Court at Kuala Lumpur in allowing the respondent's ("the plaintiff ") claim for the sum of RM10,420,461.50 (the judgment sum); interest at 10% per annum on the judgment sum from 5 March 2016 until the date of judgment; interest at 5% per annum on the judgment sum from the date of judgment until full settlement and costs.

The Background Facts

[2] The plaintiff is a Management Corporation ("the MC") established on 21 April 2008 under the Strata Titles Act 1985 ("the STA "). The defendant is the registered proprietor of 7 retail parcels ("7 parcels"), measuring 439,524.64 sq ft of the complex known as Plaza 393 ("Plaza 393").

[3] The plaintiff's claim against the defendant is for outstanding service charges, contribution to the sinking fund, quit rent, insurance and late payment interest (collectively referred to as the "management charges/management fund"). The amount claimed is for the accumulated arrears from the date of the incorporation of the plaintiff ie on 21 April 2008 until 4 March 2016.

[4] Vide the statement of claim, the plaintiff pleaded that from 21 April 2008, the defendant's contribution to the management fund is RM0.15 per sq ft and as from July 2012, the rate payable by the defendant is RM0.20 per sq ft.

[5] The defendant did not dispute the rate of contribution as stated by the plaintiff. The pleaded defence is that there is no outstanding amount due to the plaintiff as the defendant had made the necessary payments.

[6] The defendant denied owing the plaintiff the amount claimed on two other grounds, namely that the plaintiff had no locus standi to claim against the defendant and that in any event, the claim is statute barred.

Proceedings In The High Court

[7] Tan Kim Chooi ("PW1"), the plaintiff's immediate past Chairman and a Committee Member testified inter alia that the contributions payable by the defendant was initially at RM0.15 per sq ft and later increased to RM0.20 per sq ft.

[8] These rates were decided by the MC of Plaza 393 pursuant to the resolutions made by the plaintiff at its 1st AGM and 4th AGM respectively. These resolutions, according to PW1 were recorded in the Minutes of the AGMs ("the Minutes"). Both the resolutions and the Minutes were however not produced in Court.

[9] The plaintiff's claim as testified by PW1, its sole witness, is based on the plaintiff's statements of account, which PW1 is not the maker. The primary or supporting documents such as the invoices, the debit notes or credit notes were not produced in Court.

[10] For the defendant, the crux of its case is that it has paid all the maintenance charges or contribution to the management fund. The defendant relies heavily on the agreement dated 19 July 2011 ("the agreement") which was signed by the director of the defendant and the plaintiff's previous Chairman, Mr N Madhavan.

[11] Clauses 2 and 3 of the agreement read:

"2.0 ESSB's OBLIGATIONS

2.1 ESSB will at its own cost and expenses manage, maintain and contribute towards the services charges on all those common area relating to the Retail Area (hereinafter referred to as "the ESSB Common Area").

2.2 It is hereby agreed and understood that the MC is not obliged to manage and maintain the ESSB Common Area and neither is the MC obliged to contribute any service charges whatsoever towards the ESSB Common Area.

2.3 It is further agreed that ESSB shall contribute Ringgit Malaysia One Thousand Five Hundred (RM1,500.00) only on a monthly basis to