Overview

It is quite important to ask whether one’s property is a “landed property” or with “strata title”. The issue document of title to a landed property is issued by the relevant authority under the National Land Code, 1965, whilst the issue document of strata title is issued under the Strata Titles Act  1985 (Malaysia) . The 'strata' part of the term refers to apartments being on different levels, or "strata".

Strata title properties are parcels of properties in a building to be subdivided into separate parcels. Examples of properties with strata titles are office suites, parcels in a commercial complex, apartments, flats, condominiums and townhouses. When strata titles for such properties are issued, the master title for the lot of land on which the subdivided building has been erected, continues to exist and will be registered in the name of the developer or, when the book of strata register is opened, in the name of the management corporation. It is pertinent to note that the master title is issued under the National Land Code and not the Strata Titles Act  1985 (Malaysia) .

Strata titles involve the vertical subdivision of land and the building on the land into lots and common property. The lots comprise the units or apartments while the common property comprises the walls floors roof of the building, the land above, below and around the building, as well as common facilities within the building (such as foyers, elevators, stairs, landings, car park, driveways and a range of equipment).

The lots are effectively parcels of "airspace" usually bounded by floors, walls and ceilings as defined on a plan drawn by a surveyor and registered in the local titles office. The common property is everything that is left after the lots are taken out of the original land parcel. Because of this approach the plan does not actually define the common property. Sometimes there are structural features and services located within a lot but which serve other lots. These are usually deemed to be common property even though they are situated within a lot.

There are sufficient provisions in the Strata Titles Act  1985 (Malaysia)  to regulate the period within which a land proprietor (usually also the developer) must apply for the strata titles in a completed development, failing which the land proprietor shall be guilty of an offence and liable on conviction to a fine of not less than RM10,000 but not more than RM100,000 and a further fine of not less than RM100 but not more than RM1,000 for each day the offence continues to be committed.

Previously, the owners of properties with strata titles had their sub-sale transactions or re-financing transactions inordinately delayed as the consent of their respective developers was required before the property owners could proceed with these transactions. However the Housing Development (Control and Licensing) (Amendment) Act 2006 has done away with the requirement of obtaining the developer‘s consent before a sub-sale or refinancing transaction.

Another problem that was not addressed by the Strata Titles Act  1985 (Malaysia)  was the responsibility of parcel owners to pay monthly charges for the maintenance of the common areas and other contributions, to the developer, with the parcel owners having no say in the amount of the monthly charges and the standard of service provided prior to the issuance of the strata title.

Parcel owners could only participate in matters pertaining to the maintenance of the common areas after the strata titles had been issued and the management corporation had been formed from amongst them.

This problem has also been addressed with the enactment of the Building and Common Property (Maintenance and Management) Act 2007. Under this Act a joint management body comprising the developer and the purchasers will be established before the issuance of the strata titles and the joint management body will maintain the common areas and determine the amount of monthly charges, prior to the formation of the management corporation.

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