Every organization needs funds to operate. Service charges are the monthly fees that property owners pay for services provided by their housing or apartment development's management company.
These pay for the upkeep of common areas, such as repairs and running costs ( e.g. electricity, lifts, etc.) for these areas, and may cover other services such as security or landscaping.
Service charges are not an optional payment if they are part of the terms and conditions of your contract to buy the unit. Once you conclude the contract, you have an ongoing legal obligation to pay these charges. So make sure your solicitor explains these obligations.
So, remember that not paying the service may be a breach of your contractual obligation.
Noy paying could leave you open to legal action, and any outstanding debts can be tied to your property. Any monies owed may be deducted from the money you receive once the sale has gone through.
If owners do not pay the charges, your management company will also run short of money and in time it may not be able to provide even basic services. This in turn may have a negative impact on the residents' quality of life and the value of property in the development.
The following are extract from Building and Common Property (Maintenance and Management ) Act 2007 Act 663.
23. Purchaser to pay maintenance charges
1) The purchaser shall pay the charges for the maintenance and management of the common property.
2) The apportionment of the charges to be paid by the purchasers shall be determined by the Body (JMB) in proportion to the allocated share units.
3) Any written notice served on the purchaser requesting for the payment of the charges shall be supported by a statement of the charges, issued by the developer or Body, as the case may be, stating in detail the categories of expenditure in respect of which the charges are to be paid.
4) The purchaser shall, within fourteen (14) days of receiving a notice under subsection (3), pay the charges requested for.
5) If the charges remain unpaid by the purchaser at the expiration of the period of fourteen days specified in subsection (4), the purchaser shall pay interest at the rate to be determined by the Body under paragraph 6(1)(d) but such interest shall not exceed 10 percent per annum.
32. Recovery of charges by Joint Management Body
1) Where maintenance charges become recoverable by the Body from a purchaser by virtue of section 23, the Body may serve on the purchaser a written notice requesting payment of the sum due within such period, which shall not be less than fourteen days from the date of service of the notice, as may be specified in the notice.
2) If at the end of the period specified in the notice under subsection (1) the sum or part of the sum due remains unpaid, the Body may serve on the purchaser a further written notice demanding payment of the sum due within fourteen days from the date ofservice of the notice; and if upon expiry of the said period, the sum due remains unpaid, the Body may institute proceedings in any court of competent jurisdiction for the recovery of the said sum or, in addition or as an alternative to recovery under this section, resort to recovery under section 33.
33. Recovery of arrears of charges
1) Where the amount of charges payable is in arrears for six months, the Commissioner (COB) may, at the request of the developers or Body, issue a warrant of attachment in Form B of the Second Schedule authorizing the attachment of any movable property belonging to the purchaser which may be found in the parcel or elsewhere within the local authority area.
2), 3), 4), 5), 6), 7) & 8) ( If interested please get a copy of ACT 663 from the office )
34. Failure or refusal to pay charges
Any person who, without any reasonable excuse, fails or refuses to pay maintenance charges commits an offence and shall on conviction be liable to a fine not exceeding five thousand ringgit and shall also be liable to a further fine not exceeding fifty ringgit for every day during which the offence is continued after the conviction.
I must have bored you writing such a long posting. But I feel it is of utmost important for all owners pay the charges promptly.
Thank you.
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