by Angeline Ang

1 Mont Kiara is a mixed-use strata scheme comprising a residential component (Izen Kiara II), office components (Menara 1MK and Wisma Mont Kiara), and retail space (1 Mont Kiara shopping centre). Different components have exclusive access to certain common facilities.

The 2021 Order

On 7 May 2021, the High Court declared that the MC's "Method B" levy and collection of maintenance charges and sinking fund contributions were null and void, and ordered that all maintenance charges be levied "based on the consideration contained in Section 60(3) of the Strata Management Act 2013” [“SMA 2013”].

At that time, only the MC was a party to the suit; the Court did not have the benefit of hearing from the subsidiary management corporations which were not brought before the court.

The consequential application (Enc. 71)

In March 2023, the Plaintiffs (proprietors from Menara 1MK) filed Enclosure 71, asking the Court to order:

1. Full accounts of charges collected since 2016 and identification of purported overpayments;

2. Refunds of overpaid charges based on a uniform rate; and

3. Appointment of an administrator under Section 76 SMA 2013, alleging continued non-compliance with the 2021 Order.

The 2021 Order did not mandate a uniform rate.

The High Court clarified that the 2021 Order:

1. Declared Method B null and void;

2. Required charges to be levied "based on the consideration in Section 60(3) SMA 2013"; and

3. Did not explicitly mandate a single uniform rate or order any specific rate.

Section 60(3) SMA 2013 permits the Management Corporation, at a general meeting, to "determine different rates of Charges to be paid in respect of parcels which are used for significantly different purposes."

Relying on the Court of Appeal's decision in Aikbee Timbers Sdn Bhd & Anor v Yii Sing Chiu & Anor [2024] 3 CLJ 177 (read more at: https://www.angeline.associates/articles/case-update-004), the Court further clarified that:

1. The “significantly different purposes” test has been satisfied - residential, office, and retail parcels within the 1 Mont Kiara development area are used for significantly different purposes;

2. Where there are common facilities which are not capable of being enjoyed equally by all proprietors from different components, the law is that the MC is to allocate expenses differently and charge different rates, provided the allocation reflects actual use.