What’s a maintenance agreement?
This document for the upkeep of your building and apartment is very important. Go through it carefully and ensure you make all payments on time
Given the space scarcity in urban areas, more people are investing in apartments in housing complexes and group housing societies. Though allottees scrutinise the terms and conditions in the allotment letter and buyer’s agreement carefully, many fail to scrutinise terms and conditions in the accompanying maintenance agreement. A buyer’s agreement generally stipulates that the buyer will also be required to execute a maintenance agreement at the time of execution of the conveyance deed in his/her favour.
Broadly speaking, the maintenance agreement governs the provision of maintenance services in common areas, services and facilities and sets out rights and obligations of both allottees/buyers and the maintenance agency. In multistorey buildings and housing complexes, common areas and facilities refer to areas reserved for basements, parking, roofs, stairways, elevators, water tanks, terrace, open spaces, etc. For the effective administration, maintenance and upkeep of the housing complex including its common areas and facilities, a maintenance agency undertakes the responsibility of providing essential services like lighting, lifts/elevators, power back-up, sanitation, repair works, security, etc.
Under relevant atate-specific apartment ownership legislations, an apartment owner not only owns the apartment but also has a certain percentage of undivided interest in common areas and facilities of the building/apartment complex. Hence, all apartment owners are required to bear maintenance-related expens- es proportionate to their ownership and interest in the complex. Allottees may carefully note the timelines of payment of maintenance charges, penalty and interest payable on delayed payment, grounds of breach as well as consequences of breach by allottee. For instance, some maintenance agreements stipulate that in case of continued non-payment of maintenance charges, supply of water/electricity services may be disconnected to the defaulting allottee’s flat and would only be restored on payment of maintenance charges along with interest and penalty, if any. Owners may also note the timelines and amounts to be paid towards contribution to the sinking fund and maintenance security deposit (which may be interest bearing or non-interest bearing).
Moreover, maintenance charges are payable irrespective of whether an apartment is vacant/unoccupied or occupied. If the owner has leased the flat to a tenant, he/she may protect its interests by clearly stating in the lease deed that it will be the lessee’s responsibility to comply with the terms of the maintenance agreement and payment of maintenance charges for the duration of the lease term.
Maintenance agreements for properties situated in commercial complexes and office buildings are usuallymore complex given the nature of activities carried out there. Maintenance agreements for these properties may prescribe differential rates of maintenance charges for operations during usual business hours and beyond usual business hours in addition to parking charges, power backup charges, insurance etc. In some cases, the agreement may also be accompanied with housekeeping rules, rules for carrying out fit-out/interior works, rules for putting up any signage/promotional displays, etc. Enjoyment of maintenance service and facilities makes a property habitable for oneself and other occupants. Hence, it is important that occupants (be it owners or tenants) comply with the terms of the maintenance agreement.