REFORMS MAKE OUR PROPERTY LAWS BETTER

A parcel owner will now pay rent on his own parcel to the relevant authority

held in collaboration with the ministries and government agencies to ensure the success of this initiative, which would involve people from all walks of life.

I am pretty sure that those in charge of the campaign would already have a calendar of events leading towards Independence Day celebrations, especially those programmes relating to youth.

We have to remember it’s a changed Malaysia from 60 years ago. Engaging Malaysians of today is different from the time of our forefathers. And I believe each and every one of us can contribute in whatever way we know best.

ON Jan 1, three new important amendments affecting the nation’s property legislation came into force — Act A1516 (affecting the National Land Code 1965), Act A1517 (affecting the Land Acquisition Act 1960) and Act A1518 (affecting the Strata Titles Act 1985).

They represent a finale of years of work carried out by several parties, including stakeholders’ consultation, led by the office of the Director-General of Lands and Mines (DGLM), Putrajaya.

Despite some omission, which I had pointed out in recent comments, these legislative reforms have taken our property laws to the next level.

In February 2015, DGLM had issued a Consultation Paper titled “Proposed amendments to Strata Titles Act 1985 and Land Acquisition Act 1960”, stating its intention to introduce several amendments, including “the imposition of rent of parcels for individual strata titles”.

DGLM said the purpose of the introduction of rent of parcel was to enable parcel owners to execute dealings (transfer, charge, lease or easement) in respect of his parcel, since registration of dealings presented in the Land Office was dependent upon full payment of the rent. Under the National Land Code (Code), rent of the land (commonly referred to as “quit rent”) is a reference to the rent in respect of the land, on which the strata scheme is developed, which must be paid in full annually.

In the context of strata schemes, payment of quit rent is the responsibility of the management corporation, based on the contribution of each parcel owner in proportion to his share units.

It is DGLM’s proposal that this obligation to pay the rent be transferred to individual parcel owners. If this can be done, the quit rent in respect of the land to which the scheme belongs will cease to be operative upon the commencement of the payment of the parcel rent.

In the event the strata scheme is terminated, the quit rent in respect of the land will be revived, at a rate prevailing then. The proposal made sense and it was warmly received by all quarters.

Pursuant to these objectives, Act A1516 introduces a Section 96A in the Code, which states that when the Part IVA of the Strata Titles Act comes into effect, the provisions of Part Six of the Code (which deals with “Rent”) shall not apply, except Section 101 (which deals with revision of rent).

In simple terms, what this means is that when these amendments come into effect, a parcel owner will pay rent for his own parcel to the relevant authority.

In sync with the amendments in the Code, Act A1518 has introduced a Section 4C in the Strata Titles Act, which states that the minister, with the approval of the National Land Council, may by notification in the gazette, appoint a date of the coming into operation of rent of parcel or provisional block in any state. Upon the coming into operation as aforesaid, “the provisions of Part IVA shall apply”.

Part IVA of the Strata Titles Act deals with “Collection of Rent” and contains Sections 23A (Interpretation), 23B (Rent to be debt to State Authority), 23C (Determination and computation of rent), 23D (Where rent payable), 23E (Notice of demand), 23F (Right of chargees, lessees to pay sum demanded), 23G (Effect of payment of sum demanded), 23H (Forfeiture for non-payment of sum demanded), 23I (Power of State Authority to revise rent periodically) and 23J (Effect of termination of subdivision). In simple language, what Part IVA seeks to achieve is that a parcel owner is under a legal duty to pay rent for his parcel to the relevant authority when it falls due. If he fails to do so, a legal demand notice to pay will be issued, which he must immediately comply, in default of which he runs the risk of losing his property through forfeiture by the state.

The Part IVA is followed by a Part IVB, which deals with “Forfeiture and Vesting” and contains Sections 23K (Interpretation), 23L (Reversion to State Authority), 23M (Effect of forfeiture), 23N (Parcel or provisional block not to be transferred during period of appeal against forfeiture), 23O (Power of State Authority to annul forfeiture) and 23P (Appeal against forfeiture).

Part IVB explains that following the forfeiture of the parcel due to the parcel owner’s failure or default in paying his rent, the parcel will vest in the State Authority. The parcel owner is given an opportunity to appeal against the forfeiture and if his appeal succeeds, the State Authority can annul it. If the appeal is rejected, the Land Administrator can declare that the parcel, which reverts to the State Authority, is now vested and registered in the name of a “transferee”, who shall hold the parcel on behalf of the State Authority. The “transferee” is defined in Section 23K as a “statutory authority”.

Our strata law, which began as a small part of the National Land Code before it took its present form as the Strata Titles Act 1985 (Act 318), has been amended several times in the last three decades — in February 1990, then in August 1996, December 2001, April 2007, June 2015, and now on Jan 1. Participants attending a strata law conference at the Setia Alam Convention Centre last week had asked whether Act A1518 can be regarded as the last and final leg in our strata law reform?

I told them “I hope not”. The good work should continue.