City One Management Corporation v Imbasan Saga Sdn Bhd (WA-22NCvC-172-03/2020)

[6] The Plaintiff alleged that the Defendant had unjustly enriched itself at the Plaintiff's expense by not paying the Maintenance Charges and Electricity Charges. This included the unauthorised conversion of the Plaintiff's common area into an additional 10 parking bays. The Defendant’s Case [7] The Defendant refuted the Plaintiff’s claim by asserting that the Plaintiff had failed to furnish the complete and thorough particulars of their claim as mandated by SMA 2013. The Defendant further disputed the Plaintiff's claim on the calculation of the Maintenance Charges. [8] Additionally, the Defendant was dissatisfied with the change in the calculation of Maintenance Charges from the area of each unit (for the years 2015 to 2017) to the share unit since 2018. [9] The Defendant submitted that a car park agreement dated 31.07.2002 (“the Agreement”) with Fast Grade Sdn Bhd (“Fast Grade”) had been executed to enable the Plaintiff operating the Basement Car Park. [10] It was undeniable that Fast Grade had been hiring its own contractors to handle all the Basement Car Park’s upkeep, and so the Defendant argued that it was not responsible for paying the Maintenance Charges to the Plaintiff. The Trial [11] During the trial, the Plaintiff called three (3) witnesses while the Defendant called two (2) witnesses. The witnesses are listed as follows: a) The Plaintiff’s Building Manager, Daud Ansari bin Basha (PW1); b) The Plaintiff’s Chairman, M. Ramanathan a/l S.M Meyappan (PW2); c) The Plaintiff’s Maintenance Manager, Arult Chelvam a/l Sinnayaih (PW3); d) The Defendant’s Supervisor, Ho Tuck Weng (DW1); and e) The Defendant’s Director, Lim Hock Eng (DW2). Issues to be Tried [12] Before the trial, the Parties had agreed on the issues to be tried as follows: a) Whether the Plaintiff’s claim against the Defendant for the Maintenance Charges, Sinking Fund and Electricity Charges is unreasonable; b) Whether the Defendant has a statutory duty to settle the charge for maintenance works imposed by the Plaintiff against the Defendant; c) Whether the appointment of the third party by the Defendant to maintain the basement car park without the Plaintiff’s knowledge and approval absolves Defendant to pay the Maintenance Charges to the Plaintiff; d) Whether the Defendant’s letter dated 08.10.2018 to the Plaintiff for the reduction of the Maintenance Charges and Sinking Fund is an admission by the Defendant to the Plaintiff; e) Whether the method of calculation for the Maintenance Charges imposed by the Plaintiff based on share unit is irregular, misleading and without basis; f) Whether the Plaintiff at all material times has and had done maintenance work and service of common property for Unit G- 11A together with 114 accessory parcels of the basement car parks; g) Whether the Plaintiff is entitled to impose late penalty interest; h) Whether the Defendant has appointed a third party to maintain the common property; and i) Whether the Defendant has lodged a complaint that the Plaintiff had not carried out maintenance work of the common property. Decision and Findings of the Court [13] Upon careful examination of the facts and testimony provided by all parties, as well as the arguments put forth by the learned counsels representing both sides, I have concluded that the Plaintiff has successfully proven their case on the balance of probabilities. The followings are the reasons for my decision. A. The Defendant’s Statutory Duty under SMA 2013 [14] The Plaintiff’s claim is fundamentally pursuant to Section 59 (2) (a) & (b) of SMA 2013 for the outstanding Maintenance Charges, Sinking Fund and Electricity Charges. [15] The relevant part of Section 59 of SMA 2013 is reproduced for the ease of reference: “59. Duties and powers of management corporation 1) The duties of the management corporation shall be as follows: a) to collect the Charges from the proprietors in proportion to the share units or provisional share units of their respective parcels or provisional blocks; b) to collect the contribution to the sinking fund from the proprietors of an amount equivalent to ten percent of the Charges” [16] The Plaintiff also cited Section 77 of SMA 2013 which provides that the payment of any amount lawfully incurred by the MC in the course of the exercise of any of its powers or functions or carrying out its duties and obligations shall be guaranteed by the proprietors for the time being constituting the MC or the subsidiary management corporation. [17] The Defendant’s failure to pay the Maintenance Charges, Sinking Fund and Electricity Charges had led to the issuance of the statutory notice in Form 20 dated 11.10.2019 by the Plaintiff, pursuant to Regulation 31 Strata Management (Maintenance and Management) Regulation 2015 whereby the detailed outstandings were clearly stated. [18] To this, the Defendant had not only argued that the sum claimed in Form 20 was invalid, but also had challenged its format and substance. The Defendant contended that Form 20 was a pre-requisite before filing of any action in court, by virtue of Section 78(1) of SMA 2013. The Defendant’s counsel further argued that any statutory notice must be strictly complied with. The failure to do so will render it defective. The Defendant cited Muhamad Nazri Muhamad v JMB Menara Rajawali & Anor [2019] 10 CLJ 547 to support its contention. [19] For the ease of reference, excerpt of Section 78(1) of SMA 2013 is reproduced herein:

Procedure for recovery of sums due

Where a sum becomes recoverable by a management corporation by virtue of subsection 52(4), 60(4), 60(5), 61(4), 61(5) or 77(3), or by a subsidiary management corporation by virtue of subsection 68(4), from a proprietor under this Act, the management corporation or the subsidiary management corporation, as the case may be, may serve on the proprietor a written notice demanding payment of the sum due within the period as may be specified in the notice which shall not be less than two weeks from the date of service of the notice.[Emphasis added] [20] According to the Defendant’s learned counsel, Form 20 issued by the Plaintiff showed that the Plaintiff had demanded payment within 14 days, which was allegedly contrary to Section 78 of SMA 2013. [21] The Defendant relied on the judgment of Tey Kim Seng v Perbadanan Pengurusan Octiville Condominium [2019] 1 LNS 2328 to support its contention, where Awang Armadajaya Awang Mahmud JC ruled that the requirement under the law was that there must be a written notice demanding payment of the sum due within the period as may be specified in the notice. The due date should not be less than two weeks from the date of service of the said notice. [22] Vernon Ong Lam Kiat JCA (as he then was) in Muhamad Nazri (supra), a case relied by the Defendant, had clearly expressed that the duty of the court was limited to interpreting the words used by the legislature and to give effect to the words used by it. That was to say, where the words of a statute were unambiguous, plain and clear, they must be given their natural and ordinary meaning. [23] It is therefore very clear that where the issuance of a notice is not mandatory by virtue of Section 78 of SMA 2013, the court will not decide otherwise. [24] It is apt to note that Form 20 was issued on 11.10.2019 (B1, Enclosure 79, p.314). Meanwhile, this Suit was only filed via writ summon dated 10.3.2020. Hence, there is a gap of more than two weeks from the issuance date of Form 20. In short, the Plaintiff had been given more than 14 days to pay. Even If we were to adopt the 14 days period stated in From 20 issued, 14 days is clearly “not less than 2 weeks”. Hence, I see no reason to nullify Form 20 issued. [25] Furthermore, the Plaintiff’s witnesses were not cross-examined on the time duration given by the Plaintiff to the Defendant to settle the Maintenance Charges, Sinking Fund and Electricity Charges. The Plaintiff’s witness, PW1 was only cross examined about the calculation stated in Form 20 (See NOP, pp.82 & 83), but nothing on the period of the notice (Form 20) issued. [26] In Tey Kim Seng (supra), during the course of the trial, the learned counsel for the appellant did not cross-examine the respondent’s witness on the legality of the notices. Hence, the court ruled that the failure to examine a witness tantamount to acceptance of the evidence (See the then Federal Court’s decision of Wong Swee Chin v PP [1981] 1 MLJ 212). [27] In the same vein, the failure of the Defendant’s counsel to cross-examine the Plaintiff's witnesses on the period of Form 20 should be interpreted as an acquiescence. [28] On the other note, the obligation of the registered proprietor of any parcel to pay the maintenance fees is absolute by virtue of the requirement under SMA 2013. It is a statutory obligation. In the Court of Appeal case of Dato’ Manokaran Veraya v Perbadanan Pengurusan Apartment Kayangan and Another Appeal [2019] 6 CLJ 441, Suraya Othman JCA could not be clearer when she concluded as follows: “[37] ….The provisions of the law, as stated above, were very clear in that the responsibility to pay the maintenance charges falls upon the registered proprietor, regardless of whether one occupied his parcel or not. The plaintiff, as the registered proprietor of his parcel was not exempted from his responsibility to pay the charges on the mere reason that the third defendant had failed to discharge its obligations diligently. If the plaintiff is dissatisfied with the third defendant’s failure to maintain the building, he can always initiate a claim against the third defendant for breach of its statutory duty but he cannot, in the circumstances, evade his responsibility to pay the maintenance charges.”[Emphasis added] [29] Applying the above principle to our case herein, the Defendant being the proprietor of the Basement Car Park has the responsibility to pay the Maintenance Charges, regardless of whether the Plaintiff has failed to carry out maintenance works as alleged. [30] The Plaintiff referred this Court to the recent judgment of Serta Properties Sdn Bhd v Wisma Cosway Management Corporation & Stephen Properties Sdn Bhd [2023] 1 LNS 1478 which had the similar material facts to our present case. My learned brother, Ahmad Bache J envisaged as follows: “[43] Lest we forget, Section 77 of the Act, also facilitates Management Corporations in that the non-payment of management fees automatically creates an UNDISPUTED DEBT as in this case. In quite recent Federal Court case of Dubon Berhad v Wisma Cosway Management Corporation [2020] 6 CLJ 589, the Federal Court ruled as follows: “(4) Section 77 serves to statutorily provide that the non-payment of management fees creates an undisputed debt. The term ‘guaranteed’ ensures the fact of the existence of such a debt. It ensures that parcel proprietors do not evade their obligations to make such payments. The recovery of such debts is thus assured and could simply be affected under the section. …

The use of the word ‘guaranteed’ in the SMA ensures and assures straightforward recovery of the debt claimed by the MC. The fact of the existence of a debt is easily established and payment due ‘guaranteed’.” [31] Applying the above to our case herein, by virtue of Section 77 of SMA 2013, there is no way the Defendant can evade its obligation to pay the outstanding Maintenance Charges claimed by the Plaintiff. [32] Alternatively, Section 78(2) of the SMA 2013 uses the word ‘may’ when the filing of summons is mentioned. The parties disputed on the implication of this. In Delhi And London Bank Ltd v. Melmoth AD Orchard, 4 IA 127, the Privy Council opined that: “There is no doubt that in some cases the word must, or the word shall, may be substituted for the word may; but that can be done only for the purpose of giving effect to the intention of the Legislature; but in the absence of proof of such intention, the word may must be taken to be used in its natural, therefore in a permissive, and not in an obligatory, sense.” [33] Not surprisingly, in Lew On v Mohammad Muhamed Avvuu; Setiamas Sdn Bhd & Anor (Third Party) [2022] 1 LNS 103; [2021] MLJU 2787, the Court adopting the ratio of the Privy Council in Melmoth (supra) held that the word ‘may’ connotes discretion: “[88] Therefore, where the word “may” is used in law, it conveys the meaning that it is not mandatory but rather it serves as an empowering clause on a matter which would not be allowed before this or which confers upon the party mentioned in the clause, a discretion to do or otherwise. In essence, “may” as an adverb means that “a choice to act or not, or a promise of a possibility”, as distinguished from “shall” which makes it imperative, OR in statutes, and sometimes in contracts, the word “may” must be read in context determine if it means an act is optional or mandatory, for it may be an imperative. Since “may” does not connote a mandatory requirement, failure to do act that follows the words “may” cannot be construed as fatal to the cause or illegal or null and void.” [34] As a result, in our present case, in the alternative, the natural and ordinary meaning of Section 78 does not make the filing of recovery actions mandatory. Rather, it gives discretion to the MC. The MC has the option to either commence an action against the defaulted proprietor or to resort to the mechanism stated in Section 79 of SMA 2013 or any other mechanism. [35] I am indeed guided by the following ratio of our apex court in Tebin Mostapa v Hulba-Danyal Balia & Anor [2020] 7 CLJ 561; [2020] 4 MLJ 721 where Vernon Ong FCJ articulated that: “[30] In our opinion, the rules governing statutory interpretation may be summarised as follows. First, in construing a statute effect must be given to the object and intent of the Legislature in enacting the statute. Accordingly, the duty of the court is limited to interpreting the words used by the Legislature and to give effect to the words used by it. The court will not read words into a statute unless clear reason for it is to be found in the statute itself. Therefore, in construing any statute, the court will look at the words in the statute and apply the plain and ordinary meaning of the words in the statute. Second, if, however the words employed are not clear, then the court may adopt the purposive approach in construing the meaning of the words used. Section 17A of the Interpretation Acts 1948 and 1967 provides for a purposive approach in the interpretation of statutes. Therefore, where the words of a statute are unambiguous, plain and clear, they must be given their natural and ordinary meaning. The statute should be construed as a whole and the words used in a Section must be given their plain grammatical meaning. It is not the province of the court to add or subtract any word; the duty of the court is limited to interpreting the words used by the legislature and it has no power to fill in the gaps disclosed. Even if the words in a statute may be ambiguous, the power and duty of the court ‘to travel outside them on a voyage of discovery are strictly limited’. Third, the relevant provisions of an enactment must be read in accordance with the legislative purpose and applies especially where the literal meaning is clear and reflects the purposes of the enactment. This is done by reference to the words used in the provision; where it becomes necessary to consider every word in each Section and give its widest significance. An interpretation which would advance the object and purpose of the enactment must be the prime consideration of the court, so as to give full meaning and effect to it in the achievement to the declared objective. As such, in taking a purposive approach, the court is prepared to look at much extraneous materials that bears on the background against which the legislation was enacted. It follows that a statute has to be read in the correct context and that as such the court is permitted to read additional words into a statutory provision where clear reasons for doing so are to be found in the statute itself.” [36] Adopting the ratio of Lew On (supra) and Tebin Mostapa (supra), it is clear that Section 78 of the SMA 2013 confers discretion for the Plaintiff to decide which mechanism is the best option to recover the outstanding sums in arrears. The Regulations which were made by the minister in exercising the power given under Section 150 of the SMA 2013 (per the long title to the Regulations) have specifically provided such mechanism in para 6 of the Third Schedule to the Regulations. It is entirely the discretion of the management corporation to decide which of them is the best option in the circumstances. In our present case, the MC (namely the Plaintiff) has obviously opted to execute the mechanism stated in para 6 of the Third Schedule of the Regulations. There is nothing wrong or irregular in the adaptation of such mechanism because Section 78 has given the MC the prerogative to choose any mechanisms it deems suitable. [37] After my decision and at the time of my writing of this judgment, two subsequent judgements from the Court of Appeal have been delivered that must be taken notice of and mentioned here. The first is Aikbee Timbers Sdn Bhd & Anor v Yii Sing Chiu & Anor And Another Appeal [2024] 1 MLJ 948. [38] The issue presented in Aikbee Timbers (supra) was whether the management corporation had the authority to demand higher maintenance charges and increased contributions to the sinking fund from residential parcel owners compared to commercial parcel owners. [39] Aikbee Timbers Sdn Bhd developed a mixed development project named Pearl Suria. The project included residential apartments, a shopping centre, and a retail/commercial car park. The plaintiff owned the shopping mall, another firm owned and ran the retail/commercial car park, and individual owners purchased the residential flats. [40] A lawsuit was filed by a residential unit owner against the developer (who was previously in charge of the joint management body) and the management corporation. It was alleged that the developer and the management corporation had unlawfully imposed higher maintenance charges and sinking fund fees on the residential unit owners. The High Court ruled that all owners of residential and commercial properties must pay the same amount for maintenance charges and sinking fund payments. [41] In the Court of Appeal, Choo Kah Sing JCA ruled that different rates of maintenance charges and sinking fund contributions can only be applied to parcel owners if the parcels were used for significantly different purposes. Residential parcels and commercial parcels in Aikbee Timbers (supra) were significantly distinct. The court nevertheless did not engage in a discussion of the specific nature of the “substantially different purposes”. [42] In another case of AUM Capital Sdn Bhd v Menara UOA Bangsar Management Corporation [2024] MLJU 421, the dispute revolved around the question of whether the centralised air-conditioning facilities in a building, specifically the Menara UOA Bangsar development, which only served a fixed number of units, were considered part of the common property and whether the responsibility for their maintenance should be with the management corporation. [43] Menara UOA Bangsar was a composite real estate consisting of two office towers (Towers A and B), one retail block, and one parking park. The centralised air-conditioning facilities (CACF), situated in different areas of the building, provided chilled air to both the shared areas of the building and the privately owned sections in Tower B and the retail block. The private parcels in Tower A were equipped with separate unit air-conditioning systems, which were maintained and funded by individual owners. [44] The unit owners of Tower A claimed that the management corporation should not bear the cost of maintaining the CACF, as it only provided chilled air to a limited number of parcel proprietors, rather than all the proprietors of Menara UOA Bangsar. Consequently, the management corporation had been illegally using the funds in the maintenance account to cover the costs of maintaining the CACF. [45] However, the management corporation alleged that they should be responsible for maintaining the CACF since it was considered part of the building's shared property. [46] Collin Lawrence Sequerah JCA made an extraordinary finding on the subject of what constituted common property, which he defined as all the things that did not belong to any particular private parcel. So, as long as the amenities served the common property, the management corporation may be legally obligated to maintain them even if they considerably benefit some parcels but not all of them. [47] I have to note here that these 2 decisions of the Court of Appeal may have their impact to our present case. However, in view that it was not presented by the parties during their submission, I shall leave them out for the obvious reason. [48] This Court will determine the maintenance works carried out by the Plaintiff in the later part of this judgment. B. Computation of the Outstanding Maintenance Charges. [49] The gist of the Plaintiff’s claim against the Defendant are as follows: a) Maintenance Charges from January 2015 to September 2019 amounted to RM 1,135,722.82; b) Sinking Fund from January 2018 to September 2019 amounted to RM 37,674.00; and c) Electricity Charges from January 2015 to August 2019 amounted to RM 66,572.80. i) Maintenance Charges and Sinking Fund [50] According to the Plaintiff’s counsel, the calculation of Maintenance Charges from January 2015 to December 2017 was based on square feet calculated as follows: RM 47,817.95 sq ft x RM 0.40 per sq ft = RM 19,127.18 per month [51] However, starting from January 2018 to September 2019, the Plaintiff submitted that the calculation for the Maintenance Charges was based on share units. Since the share unit for the Defendant’s Basement Car Parks was 69 share units, the Maintenance Charges were calculated at the rate of RM 260.00 per share unit and RM 26.00 per share unit for Sinking Fund. Hence, the Maintenance Charges per month were RM 17,940.00 and Sinking Fund was RM 1,794.00 per month. [52] The Defendant responded by asserting that it was not required to pay Maintenance Charges and Sinking Fund, as the Plaintiff's claim was irregular, defective, and invalid to charge based on share unit. [53] The Defendant relied on the judgment of the Court of Appeal dated 13.4.2022 (“the Judgment”) which stated that there was no resolution passed for the rate of RM 26.00 per share unit to be charged as maintenance charges and RM 26.00 to be charged as sinking fund based on 69 share units allotted to the Defendant’s unit inclusive of the accessory parcel in the Basement Car Park. [54] Nevertheless, the Plaintiff denied and contended that the Judgment only impacted the unit known as Lot 1-03, which was based on the share unit for the years 2018 and 2019. [55] In other words, the Plaintiff contend that the Defendant's assertion was unfounded, as the Plaintiff had conceded to the Judgement and had changed the method of calculation from share unit to square feet for the years 2018 and 2019 in accordance with the resolution passed at the 6th AGM on 27.05.2023, Agenda 8 (B2, Enclosure 79, p.182). This was also supported by PW1’s testimony in the witness statement (See PWS1, Q&A 31 & 32). [56] Furthermore, the Plaintiff claimed that it had issued credit notes amounting to RM 7,291.41 to reduce the outstanding Maintenance Charges from RM 1,135,722.82 to RM 1,128,431.41 (Exhibit B2, Enclosure 79, pp.179 & 180) [57] Therefore, the Defendant's claim that the Plaintiff has made an incorrect charge is no longer relevant or significant, and has become conjectured at this point. I find it ironic that the Defendant does not present the actual calculation to the court, despite the fact that it challenges the calculation made by the Plaintiff. Hence, due to the lack of an alternative, I have to accept the Plaintiff's computation. ii) Electricity Charges [58] The Defendant vehemently argued that the Plaintiff’s claim for the Electricity Charges was baseless and without merits. [59] In Tey Kim Seng (supra), one of the issues covered was whether the claim by the management corporation for water bill ultra vires the powers of the respondent. “[11] The key phrase is “The payment of any amount lawfully incurred by the Management Corporation and “be guaranteed by the proprietors” [12] What is then “the amount lawfully incurred”? [13] As the phrase suggested, it is: i. an amount of money; ii. incurred by the management corporation or subsidiary management; iii. in the course of exercise of any of its power/function/duties/obligations; iv. it is lawfully incurred … [15] That being said, the MC is responsible to ensure a continuous water supply to the condominium as there is no allegation that water supply to the condominium has ever been cut off, I take it that the water supply has always be in a steady flow since the opening of the condominium for human occupation… Unless proven to the contrary, the only party that been bear such burden is the Management Corporation which now claims the said sum from the Appellant/Defendant. [16] Hence, it is the considered view of the court that the water bill is now within the meaning of “any amount lawfully incurred by the Management Corporation.” [Emphasis added] [60] In our present case, the Plaintiff has adduced evidence of TNB bills which shows that the electricity bills were paid by the Plaintiff (B1, Enclosure 73, pp.246 to 303). Hence the Electricity Charges fall under the amount lawfully incurred. [61] In fact, DW2 testified during trial that the electricity bills had not been paid by the Defendant. [See NOP, p.318] Doesn’t matter some or used, but you have not been paying, that’s all, you agree with me? DWS2 Yes. [62] The calculation of Electricity Charges was done by PW3 who was the Maintenance Manager, with the necessary qualification. [See NOP, p.165] DC Are you authorised by TNB or Suruhanjaya Tenaga PWS3 No, actually I got license already approve by Suruhanjaya. [Emphasis added] [63] I completely agree with the Plaintiff's assertion that after it has substantiated its calculation, the burden of proof now shifted to the Defendant to provide evidence to the contrary (See Tenaga Nasional Bhd v AWP Enterprise (M) Sdn Bhd [2015] 3 MLJ 268). [64] Surprisingly, the Defendant has not contested the computation in its response. This clearly indicates that the Defendant is aware of and has not opposed to the methodology. C. Maintenance Works i) Whether the Plaintiff has Carried Out the Maintenance Works in the Basement Car Park [65] The Defendant strongly refuted the Plaintiff's claim that they had serviced and maintained the common areas of the Basement Car Park. Accordingly, the Defendant claimed that Fast Grade was the only one responsible for the Basement Car Park's maintenance. [66] To refute, the Plaintiff had produced various invoices to indicate the maintenance works carried out by them (B1, Enclosure 73, pp.242 to 305). [67] Also, PW1 testified that various maintenance works were carried out by the Plaintiff for the benefit of all the proprietors of Plaza City One, including the Defendant. These works include maintenance of sprinkler system, maintenance and repair of lifts, the maintenance and checking of the exhaust fan, the roller shutters and alarm systems, the guard patrolling the basement car park, generator set, and LV room i.e low voltage room which controlled the supply of electricity for the whole building including car park. [68] The evidence was also supported by the testimony of PW3 (See PWS3, pp.4-6), who testified that the sprinkler and shutters would be maintained every month in obtaining the certificate of fire safety from Bomba and the monthly maintenance would be carried out by project team engineering and Master Pyroserve Sdn Bhd. [69] During trial, the Defendant’s witness, DW1, acknowledged that the Plaintiff had performed some maintenance tasks, such as repairing the fire extinguisher and the low voltage room, which regulated the building's electricity. [See NOP, pp.215 & 216] Mr. Ho, saya rujuk kepada mukasurat 146, fire extinguisher. Fire extinguisher ini terdapat di mana Mr. Ho? Di chiller room. Chiller room di? Basement car park. Siapa yang menyelenggara fire extinguisher ini? MC. … Okay tak apa, saya beritahu Mr. Ho. Mr. Ho, yang ini merupakan LV room, Low Voltage room untuk control electricity for the whole building. Betul? Betul. [70] The maintenance included the water sprinkler located in the Basement Car Parks, as testified by DW1. [See NOP, p.217] Saya mengatakan Mr. Ho, water sprinkler ini juga, penyelenggaraan dilakukan oleh MC, betul tak? Betul. [71] It is unfortunate that the Defendant presented out-of-date invoices and bills to this Court in order to buttress the allegation that the maintenance activities were only carried out by Fast Grade. This is confirmed and testified by DW1 during cross-examination. [See NOP, p.223] Saya tanya sekali lagi ya. Invois ini bertarikh 24.9.2012. Tadi saya cakap dengan Mr. Ho, tuntutan Plaintif terhadap Defendan adalah untuk tahun Januari 2015 hingga September 2019 tapi invois ini yang bertarikh 24.9.2012 adalah invois yang telah dikeluarkan untuk kerja yang dilakukan sebelum tarikh tuntutan Plaintif, 2012 sebab claim Plaintif terhadap Defendan bermula dari Januari 2015 sahaja. So, 2012 adalah sebelum tarikh tuntutan Plaintif terhadap Defendan. Setuju? Setuju. [72] In short, the Defendant through its witness, has agreed that it did not cover all maintenance works, as some of them were carried out by the Plaintiff. [See NOP, p.227] Mr. Ho, saya merujuk kepada jawapan Mr. Ho di soalan 14, your penyataan saksi Mr. Ho. Soalan 14 adalah di mukasurat 3. Mr. Ho telah menyatakan bahawa sepanjang tenpoh penyewaan sehingga kini semua kerja-kerja penyelenggaraan dilakukan oleh Fast Grade. Tapi tadi Mr. Ho ada setuju dengan saya yang kerja-kerja penyelenggaraan bagi water sprinkler dan kerja-kerja yang saya telah tunjukkan dari gambar-gambar tadi adalah dilakukan oleh MC. Encik Ho setuju tadi. So Mr. Ho, setuju tak Mr. Ho tak melakukan kesemua kerja-kerja penyelenggaraan. Mr. Ho ada melakukan pembersihan, menyapu, mop itu memang Mr. Ho ada lakukan tetapi bukan kesemua kerja penyelenggaraan. Setuju dengan saya? Setuju. [73] The Plaintiff has also been providing the security services for the Basement Car Parks. This was corroborated by the photograph (B2, Enclosure 79, p.135) and the candid testimony of DW1. [See NOP, p.214] Tadi Mr. Ho ada menyatakan bahawa kesemua kerja-kerja penyelenggaraan bagi car park dijalankan oleh Fast Grade. Sekarang saya rujuk Mr. Ho kepada gambar-gambar di B2 iaitu di mukasurat 135. Ada satu sekuriti jalan dekat sana kan dalam gambar itu? Itu bukan sekuriti kita. So, itu sekuriti siapa? Dia orang buat wayang sana, buat gambar. Saya tanya, siapa punya sekuriti, answer my question? MC. ii) Whether the Appointment of the Third Party by the Defendant has absolved their Responsibility to pay the Maintenance Charges imposed. [74] The Plaintiff has convincingly demonstrated to this Court that any maintenance services conducted by Fast Grade are solely for its own advantage under Clause 5 of the Agreement. The Plaintiff further referred to the cases of Ong Hock Eam & Anor v Perbadanan Pengurusan Komtar Fasa Satu and other appeals [2018] MLJU 119, Dato Manokaran Veraya v Perbadanan Pengurusan Apartment Kayangan and other appeal [2018] MLJU 1666 and UEM Land Berhad Yongnam Engineering Sdn Bhd [2020] 3 MLRH to submit that the Defendant is under an obligation to pay maintenance regardless whether the maintenance work had been carried out. No matter what, the duty to pay maintenance remains. [75] During cross examination, DW1 testified that any maintenance works carried out by Fast Grade was pursuant to the Car Park Agreement dated 31.07.2002 for its own benefit in generating income. [See NOP, pp.209 & 210] Kerja-kerja tersebut adalah berdasarkan kepada perjanjian Fast Grade dengan defendan, dengan Imbasan Saga, betul? Betul. Terma-terma yang saya menyatakan Mr Ho di muka surat 51.5.2 to provide, install and maintain at its own expenses, the necessary entry and exit car park access control equipment at the demised premises. Yes. [76] I find the Plaintiff’s reliance on the case Plaza 393 Management Corporation (established under the Strata Titles Act 1985) v Ekuiti Setegap Sdn Bhd [2016] MLJU 1177 of great assistance. In that case, Yeoh Wee Siam J held that: “[45] In the absence of any evidence that a resolution has been passed, or a certificate issued by the Plaintiff as the MC, approving the maintenance charges as provided in the Agreement, the Defendant cannot rely on the Agreement for its defence. Therefore, the Defendant is required to pay the Plaintiff all sums due to the Plaintiff as a MC. [46] The law is trite, that a person cannot contract out of statutory requirements.” [Emphasis added] [77] Hence, the Defendant cannot absolve itself from paying the Maintenance Charges to the Plaintiff which is the statutory duty of the Defendant under the SMA 2013, even if it has entered into a contract with any third party, namely Fast Grade in this case. [78] Furthermore, the Plaintiff premised that Fast Grade had acted as the Defendant’s agent, when it wrote to the Plaintiff on 5.10.2018 to negotiate on behalf of the Defendant. The Defendant further admitted having knowledge of the amount payable to the Plaintiff via letter dated 8.10.2018. This clearly shows that the Defendant is aware of its statutory duty and obligations to pay not only the Maintenance Charges but also the Electricity Charges. Yet the Defendant has failed to pay these Charges. [79] This Court find that Fast Grade served as the Defendant's representative when it corresponded with the Plaintiff on 5.10.2018 (B1, Enclosure 73, p.213) to engage in negotiations on behalf of the Defendant. This has never been disputed or renounced by the Defendant. [80] The Defendant further acknowledged its awareness of the sum owed to the Plaintiff by a letter dated 8.10.2018 (B1, Enclosure 73, p.215). This unequivocally shows that there is admission by the Defendant of its statutory duty to not only settle the Maintenance Charges but also the Electricity Charges. [81] At trial, DW2 testified during cross-examination that the Defendant was aware that it had statutory obligation to pay the Maintenance Charges and Sinking Fund. [See NOP, p.336] Are you aware since you’ve mentioned Strata Management Act, are you aware that the Defendant’s liability to pay the maintenance, sinking fund is statutory claim pursuant to SMA, are you aware? DW2 Yes. [82] Therefore, the Defendant should have been aware that the Basement Car Park is a strata property at the time it entered into the Agreement, and as a result, it is obligated to pay the Maintenance Charges and Sinking Fund. Why would the Defendant initially agree to enter into the Agreement if it were to disagree with the amount? [83] The Defendant has the option to appeal to the MC if it deems the Maintenance Charges to be intolerable. Merely refusing to make the payment is both unacceptable and self-centered. D. Other Issues i) Penalty [84] It is the Defendant’s argument that the Plaintiff is not entitled to impose any late penalty interest. The Plaintiff had nevertheless rebutted by stating that they had proved before this Court that they had carried out maintenance works for the benefit of the Basement Car Park that belonged to the Defendant. This Court is satisfied with the Plaintiff on this. The Plaintiff further added that since the Defendant had the statutory duty to pay for Maintenance Charges, it consequently entitled the Plaintiff to charge late penalty interest if the Defendant failed to pay within the specified time. The Plaintiff, in its capacity as the management corporation, has the authority to establish the amount of interest that the proprietor is required to pay in the event of late payment. As outlined in Section 60(3)(c) of SMA 2013, this interest rate is not to exceed ten percent per annum. ii) Complaints [85] The Defendant also relied on the fact that there had been a complaint made against the Plaintiff for not carrying out the maintenance works in the Basement Car Parks so as to justify its refusal to pay the Maintenance Charges imposed by the Plaintiff. [86] However, this Court is of the view that the Defendant is not allowed to refuse payment of what is invoiced and billed under any circumstances. Non-payment of such obligations may lead to legal proceedings being initiated against the Defendant (See Tey Kim Seng (supra)). If at all, the Defendant could always initiate separate action to raise its concern. It should not use this as an excuse to refuse payment of all its due. Conclusion [87] The Plaintiff’s claim is hereby allowed with cost. I hereby order that the outstanding maintenance amount of RM 1,128,431.41 (after deducting the amount of RM 7,291.41 pursuant to credit note issued) as at September 2019, outstanding sinking fund of RM37,674.00 as at September 2019, outstanding electricity charges amounting to RM 66,572.80 are to be paid by the Defendant to the Plaintiff. The said total of RM 1,232,678.21 is further subject to interest at the rate of 5% per annum from the date of the filing of this Suit, namely from 10th March 2020 until the full settlement of the same. Date : 30th September, 2024 Dr John Lee Kien How @ Mohd Johan Lee Judge High Court Malaya Kuala Lumpur For the Plaintiff Prakash Chandrakant & Shashikala Anne Messrs. Prakash & Co. Advocates & Solicitors For the Defendant Dato’ Abdul Fareed bin Abdul Gafoor & Noramira binti Abd Hamid Messrs. Ezrilaw Firm Advocates & Solicitors Table of Authorities Cases Ong Hock Eam & Anor v Perbadanan Pengurusan Komtar Fasa Satu and other appeals [2018] MLJU 119 Dato Manokaran Veraya v Perbadanan Pengurusan Apartment Kayangan and other appeal [2018] MLJU 1666 UEM Land Berhad Yongnam Engineering Sdn Bhd [2020] MLJU 284 Plaza 393 Management Corporation (established under the Strata Titles Act 1985) v Ekuiti Setegap Sdn Bhd [2016] MLJU 1177 Muhamad Nazri Muhamad v JMB Menara Rajawali & Anor [2019] 10 CLJ 547 Tey Kim Seng v Perbadanan Pengurusan Octiville Condominium [2019] 1 LNS 2328 Serta Properties Sdn Bhd v Wisma Cosway Management Corporation & Stephen Properties Sdn Bhd [2023] 1 LNS 1478 Dubon Berhad v Wisma Cosway Management Corporation [2020] 6 CLJ 589 Delhi And London Bank Ltd v. Melmoth AD Orchard, 4 IA 127 Lew On v Mohammad Muhamed Avvuu; Setiamas Sdn Bhd & Anor (Third Party) [2022] 1 LNS 103; [2021] MLJU 2787 Tebin Mostapa v Hulba-Danyal Balia & Anor [2020] 7 CLJ 561; [2020] 4 MLJ 721 Aikbee Timbers Sdn Bhd & Anor v Yii Sing Chiu & Anor And Another Appeal [2024] 1 MLJ 948 AUM Capital Sdn Bhd v Menara UOA Bangsar Management Corporation [2024] MLJU 421 Tenaga Nasional Bhd v AWP Enterprise (M) Sdn Bhd [2015] 3 MLJ 268 Wong Swee Chin v PP [1981] 1 MLJ 212 Statute Strata Management Act 2013 Strata Management (Maintenance and Management) Regulation 2015