Strata Management Tribunal (SMT): How to make a claim?

Discover how the Strata Management Tribunal (SMT) can be an ally for strata property owners to resolve disputes. Whether you’re contesting committee decisions or seeking compensation, the SMT provides a platform for presenting your case. Gain insights into the necessary steps, documentation requirements, and expert advice to navigate claims effectively.

The Strata Management Tribunal (SMT) is an avenue for recourse in disputes arising from strata management in stratified buildings in Malaysia. It was established under Section 107 of the Strata Management Act 2013 (SMA), which is applicable to the strata management of all types of stratified buildings for the purpose of residential, commercial and/or industrial. 

It doesn’t extend to any claims related to disputes over ownership.

SMT was established in 2015 to provide an easy and cost-effective channel for dispute resolution. Parties involved are advised to attempt resolving the dispute between themselves first. If unsuccessful, the aggrieved party can opt to file a claim with SMT. 

The SMT will review the claim and consider the evidence and arguments presented by the parties at the hearing. SMT has the authority to make binding decisions, and its decisions can be enforced through the civil courts if necessary.

What Types of Cases Can Be Filed With The SMT? 

• The jurisdiction of the SMT falls under the Fourth Schedule of SMA 2013, which allows the SMT to hear disputes in the following strata management matters:
• Disputes over failure to perform a function, duty or power imposed by SMA 2013.
• Subject to subsection 16N(2) of the Housing Development (Control and Licensing) Act 1966 [Act 118], the dispute on costs or repair in respect of defects in the parcel, building or land proposed for sub-division into parcels, or the building or land for subdivision into parcels, or subdivided building or land, and its common property or limited common property.
• A claim for recovery of charges, or a contribution to the sinking fund, or any amount which is declared by the provisions of this Act as a debt.
• A claim for an order to convene a General Meeting.
• A claim for an order to invalidate proceedings of the meeting where any provision of the Act is contravened.
• A claim for an order to nullify a resolution where voting rights have been denied or where the due notice has not been given.
• A claim for an order to nullify a resolution passed in a General Meeting.
• A claim for an order to revoke the amendment of by-laws having regard to the interests of all the parcel owners or proprietors.
• A claim for an order to vary the rate of interest fixed by the JMB, MC or Subsidiary Management Corporation (SMC) for late payment of the Charges, or the contribution to the sinking funds.
• A claim for an order to amend the amount of insurance to be provided.
• A claim for an order to pursue an insurance claim.
• A claim for compelling a developer, JMB, MC and SMC to supply information or documents.
• A claim for an order to grant consent to effect alterations to any common property or limited common property.
• A claim for an order to affirm, vary or revoke the decision made by the Commissioner of Buildings (COB).

Additionally, the SMT has jurisdiction over claims for obtaining:

• An order to enforce the implementation of by-laws;
• An order to prevent the violation of by-laws; and
• Compensation for any damage or injury to the person or asset caused by contravention against the by-laws.

What are the most common complaints?

Complaints related to defaulters in paying maintenance fees and inter-floor leakage have emerged as the most common claims brought before the Strata Management Tribunal (SMT) to date. 

According to the law, if a claim falls within the jurisdiction of the SMT and the issues in dispute are raised either in the initial claim or during the hearing process, those specific issues cannot be taken to court by the same parties involved. 

Thus, once a claim is filed with the SMT and the relevant issues are addressed, they cannot be re-litigated in court between the same parties. However, there are exceptions to this rule. Claimants who wish to withdraw their claims can inform the president of their intention to do so, with the option to file a fresh claim in the future if needed. Additionally, claims may be struck out if the parties fail to attend the hearing for their claims.

Who can file a claim with the SMT?

The SMT has specific jurisdiction and scope as outlined in the SMA 2013, limited to matters related to Strata Management only. Any criminal offences or other offences not covered under the SMA 2013 must be reported to the appropriate authorities responsible for handling such cases.

The maximum claim limit is RM250,000 in the SMT. Unlike the Housing Tribunal, there is no time limitation for filing claims in the SMT due to the ongoing nature of strata management. 

Parties are not allowed to have legal representation unless a party may suffer severe financial hardship and there are complex legal issues involved. So, if one party is allowed legal representation, the opposing party will also be granted the same right.

Parties who can file a claim in SMT include:

• Developer
• Sub-sale buyer
• The owner (including the first-hand owner)
• Joint Management Body (JMB)
• Management Corporation (MC)
• Subsidiary Management Company (SMC)
• Management agent (appointed by COB)
• Other parties with vested interests (special permission granted by the tribunal)

Forms and fees at each stage of the process

Every claim filed in the SMT commences with the submission of Form 1. Below, you’ll find the list of forms and fees involved in the different stages of filing, hearing, and award.

Form	Description	Amount
Form 1	Statement of claim for residential	RM100
Form 1	Statement of claim for commercial / industrial	RM200
Form 2	Statement of defence and counterclaim for residential	RM100
Form 2	Statement of defence and counterclaim for commercial / industrial	RM200
Form 3	Statement of defence against counterclaim for residential	RM50
Form 3	Statement of defence against counterclaim for commercial/ industrial	RM100
Form 4	Notice for hearing
Form 5	Notice for negotiation
Form 6	Award with agreement by all parties
Form 7	Award for claimant if the defendant does not file the Statement of Defence
Form 8	Award for claimant where the defendant admits the claim
Form 9	Award for claimant where the defendant is absent
Form 10	Award for the defendant where the claimant is absent
Form 11	Award after hearing
Form 12	Notice for Summon to Appear	RM100
Form 13	Summon to Appear
Form 14	Notice for application for residential	RM50
Form 14	Notice for application for commercial / industrial	RM100
Form 15	Order for application for residential	RM50
Form 15	Order for application for commercial / industrial	RM100
Form 16	Application for setting aside an award

All forms must be filled in clearly, to ensure a smooth preliminary assessment by the secretary. Clear and accurate documentation also facilitates processing by the President and other relevant officers. 

Any unclear statement of claim or counterclaims may nullify the case. Additionally, all claims or counterclaims must be included in the relevant forms. If space is insufficient, attachments are permitted. Providing a chronological order of events can ease the processing of the case. 

Once the hearing begins, no additional claims or counterclaims can be introduced. However, the claimant may file a new case for any pending claim at their own discretion.

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Step-by-step guide to SMT claims and counterclaims

1. Claimant prepares documents and fills in Form 1

•  Provide a written statement outlining the details of the dispute, including the parties involved, the nature of the dispute, and the costs and/or damages you’re seeking. You can include the filing fee and transportation costs.
  
• Include any supporting documents, such as contracts, emails, or photographs, that may support your claim. Be as detailed and accurate as possible as this will help the SMT to understand the specific circumstances of your case.

All claims must be included in Form 1. If the claimant is an individual, he/she must sign the form or provide a thumbprint. In the event the claimant is a corporation or an unincorporated body, Form 1 must be signed by an authorised personnel or office bearer, along with the company’s official stamp or common seal. 

Make four copies of Form 1 and submit them along with the required fee. All four copies of Form 1 must be personally signed by the claimant. If there’s more than one respondent involved, an extra copy for every additional respondent must be submitted.

The Secretary of the SMT will acknowledge receipt by stamping it with a seal of the Tribunal, and date and sign the forms. The stamped documents will include a file number with the year, SMT zone, and reference number. Two copies of the signed and stamped Form 1 will be kept by the Secretary, while two copies will be returned to the claimant.

Within 14 days from the date of its issuance, the claimant must serve one signed and sealed copy of Form 1 to each respondent. This can be done by: 

i. personal delivery; 

ii. registered post to the respondent’s last-known address; or 

iii. attaching the document prominently at their last-known business address, registered office, parcel, or residence. 

The document is valid for 30 days from its issuance. Failure to submit Form 1 within the given timeframe will invalidate the document, but the claimant can file a fresh claim once the expiry date has passed.

2. Respondent responds to claim by filing Form 2

Form 2 contains:

• Admission to the claim, if the respondent admits the claim.
• Particulars as to why the respondent disputes the claim, if the respondent does not admit the claim.
• Particulars of counterclaim, if the respondent has a counterclaim.

If the claimant is an individual, he/she must sign or thumbprint the form. If the respondent is a corporation or an unincorporated body, the form must be signed by an authorised person. The signatory must provide his/her full name, and the company’s official stamp or common seal should be affixed to the form.

The completed form must be filed with the Tribunal within 14 days from the date the claimant received his/her copy. Just like Form 1, four copies of Form 2 must be submitted, along with the required fee. If there’s more than one claimant, an additional copy must be filed for each additional claimant.

Upon receiving Form 2, the Secretary will acknowledge it by affixing a dated and signed seal. Two copies of the form will be kept at the Tribunal, while the other two copies will be returned to the respondent. One copy of Form 2 must be served to the claimant within 14 days.

3. Claimant addresses counterclaim with Form 3

To address the counterclaim filed in Form 2, the claimant must use Form 3 to clearly state his/her position by either admitting or disputing it. If the claimant is an individual, he/she must sign or thumbprint the form. 

If the claimant represents a corporation or an incorporated body, an authorised person must sign the form, providing his/her full name, and affixing the company’s official stamp or common seal. The claimant must submit four copies of Form 3 to the Tribunal within 14 days.

➡️Download the list of documents required for a Strata Housing Tribunal claim here: KPKT.gov

What Are The Processes After Filing Claims With The SMT?

Upon receiving Forms 1, 2 and 3, the Secretary will refer the claim to either Negotiation (Form 5) or Hearing (Form 4).

What happens at the ‘Negotiation’ stage?

Negotiation serves as a platform for resolving disputes by encouraging involved parties to sit down and communicate. The Tribunal has trained officers to facilitate this, by issuing Form 5 to the claimant and respondent. 

Any decisions or settlements reached during negotiation will be officially recorded in Form 6. If the negotiation fails to address the disputed concerns, the case will be forwarded for a hearing at the Tribunal.

However, due to time constraints within the Tribunal’s Key Performance Indicators (KPIs), the negotiation step has been discontinued. Nonetheless, the claimant may still request a negotiation process if they believe it would be beneficial to them.

What happens at the ‘Hearing’ stage?

Unlike civil courts, SMT is made accessible to the public without the need for lawyers. Legal officers and the President provide guidance on the hearing procedures and processes to the parties involved. 

Presenting a chronological order of events can help the President understand the claims and counterclaims more easily, expediting the process. All participants should also dress formally and ensure their mobile phones are on silent.

Before the hearing, both the claimant and respondent are encouraged to write down their testimonies, clarify the claims and issues in the case, and anticipate possible questions during the examination-in-chief, cross-examination, and re-examination processes.

During the hearing, the claimant has the right to present evidence, call witnesses, and provide any supporting documents, records, or other relevant materials. Subsequently, the respondent will present their case and have the same rights. The usual processes of examination-in-chief, cross-examination, and re-examination will be followed.

Any award issued after the hearing will be documented in Form 11.

Summon to Appear

At any stage of the hearing, the claimant or respondent may request the Tribunal to summon a person to appear as a witness or to produce specific documents, records or other items in their possession. To do so, they need to complete Form 12, providing detailed grounds for the application and explaining the relevance of the person or items to the claim or counterclaim. Then, the Tribunal will decide whether to accept the application fully, conditionally, or decline the application.

Form 12 should be submitted to the Tribunal in three copies, with an attachment of summon to appear in Form 13, along with the necessary payment. If the application is granted, the Tribunal will register Form 13, which serves as a summons for the person to appear. Two copies of the signed and sealed Form 13 will be returned to the applicant. A copy of Form 13 shall be served to the person named in the form within seven days.

If the person named in Form 13 fails to comply by not appearing as a witness or not producing the requested items, they can be found guilty of an offence. Upon conviction, they may face a fine of up to RM5,000, imprisonment for a maximum of three years, or both. Furthermore, the Tribunal has the authority to apply to a court for an order of committal or contempt of court as well.

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Interlocutory Order

An interlocutory order is a non-final, temporary order issued during the course of litigation. Drawing an analogy, one may consider an interlocutory application as the “add-on” on a budget flight. There are various types of interlocutory applications that can be filed, such as applications for legal representation, summary judgement, striking out pleadings, and amending pleadings.

To apply for an interlocutory order, a notice of application in Form 14 must be submitted. The Secretary will acknowledge the receipt of the form by applying a dated and signed seal. The Secretary will then assign a date, place, and time, for the hearing. 

The Secretary will retain two copies of the signed and sealed Form 14, while the remaining copies will be returned to the applicant. The applicant must serve Form 14 to the parties involved within 7 days. Failure to do so within the given timeframe will result in Form 14 being struck out.

The hearing for an interlocutory order will be heard before the Secretary or a designated officer unless otherwise directed by the President. The standard procedures for a hearing will be followed, and an order issued will be documented in Form 15, subject to terms and conditions that the Tribunal deem fit.

Who can order relevant parties to surrender documents?

The Tribunal may order any party to surrender documents or materials that are or have been in their possession, custody or power.  This is to ensure a swift resolution of the claim during the hearing.  

Additionally, both the claimant and respondent may apply to the Tribunal for a similar order. They can submit a notice of application in Form 14, along with a list of documents, to request any party involved to surrender documents or materials that are or have been in their possession, custody, or control.

Form 14 should include details of the grounds of application, and an order shall be made in Form 15, subject to terms that the Tribunal deem appropriate.

What is the process of getting an independent expert?

The Tribunal may appoint an independent expert at any time, on its own or applied by any party. Known as the Tribunal Technical Team, they possess relevant knowledge and experience related to the matter at hand. Their opinions will be admissible as evidence and given appropriate weight by the Tribunal.

If the Tribunal Expert needs to conduct necessary experiments or tests to provide a satisfactory report, he/she will notify the parties involved and make arrangements for it. Three copies of the expert’s report should be submitted to the Secretary of the SMT.

Upon receiving a copy of the Tribunal Expert’s report, any party may apply to the Tribunal for permission to cross-examine the expert on his/her report. The Tribunal will then order for the cross-examination, specifying the time and place, which may be during the hearing or before it.

Additionally, the claimant or respondent can call upon an independent expert witness to provide evidence or challenge the findings of the Tribunal Expert, after serving reasonable notice to the other party. However, no party can call more than one such witness, unless granted permission by the Tribunal.

What types of awards can be imposed by the SMT?

• If both parties fail to appear at the hearing, the case may be dismissed.
  
• If the claimant and respondent are present but the respondent has not filed Form 2 (Statement of Defence), the Tribunal may either grant an award in Form 7 or adjourn the hearing to allow the respondent to file Form 2. The Tribunal may also allow the respondent to submit their defence orally and proceed with the case.
  
• If the claimant is present but the respondent is absent, the Tribunal may adjourn the hearing to a later date or grant an award in Form 10.

• If the claimant is absent but the respondent is present, the Tribunal may adjourn the hearing to a later date or grant an award in Form 9.

• When both parties are present and the hearing proceeds smoothly, an award or order will be issued in Form 11.
  
• In any of these situations, the Tribunal will consider any representations submitted by the party present before making a decision on the claim or counterclaim in the absence of any party. If there are any clerical errors in the award or order due to accidental mistakes or omissions, the Tribunal can rectify or correct them at any time.

• If a legal question arises during the proceedings, the Tribunal may refer the question to the High Court, and the award will be made in accordance with the High Court’s decision.

What Happens if a party ignores the Tribunal’s Order?

In the event of non-compliance with the award, the winning party needs to serve a notice to the Tribunal. This triggers two actions – a civil action and a criminal action. The Tribunal will serve the award to the relevant court with jurisdiction, with jurisdiction where the award was made or where it applies, and register the same as a record. 

The award will then be deemed a court order. The winning party may appoint a lawyer in order to proceed with the civil action.

Meanwhile, the winning party must file a complaint with the relevant Commissioner of Buildings to initiate criminal action, in accordance with Subsection 123 of the SMA 2013.

Failure to comply with a Strata Management Tribunal Award is known as the “Ingkar Award.” If a party fails to comply with the award, the other party may seek enforcement of the award through the courts.

How to deal with an Ingkar Award?

1. Borang Ingkar Award TPS 

Complete Borang Ingkar Award TPS and have it signed by the claimant. Attach five sets of the Tribunal Award to the form. The SMT will send it to the Magistrates Court for registration under Section 120 of the SMA 2013. This registration process usually takes around two to three months.

2. Seek legal advice

• Civil action: Seek a qualified strata lawyer who can provide guidance on the available legal options and the best course of action if you decide to pursue a civil case. However, it is always advisable to try to resolve issues amicably by negotiating a mutually acceptable solution with the other party.
  
• Criminal action: Once the Commissioner of Building (COB) is notified about the Ingkar Award, the COB will initiate an investigation. Once completed, the party who failed to comply with the award may be prosecuted in the criminal court for failing to comply with the award. If convicted, the party may face punishment such as a fine or imprisonment.

Make sure to find out When can you take a property developer to court in Malaysia?

3. Judicial Review 

The award or order issued by the Tribunal is considered final. However, if any party believes that they have been unjustly affected by irregularities in the proceedings or have concerns about a legal matter, they may seek judicial review from the appropriate courts.

What are the major flaws of the SMT?

The SMT has successfully resolved many disputes. However, criticisms or flaws have been identified with the SMT system. 

• Limited jurisdiction: The SMT only has jurisdiction over disputes related to strata-titled properties. It does not have the authority to hear other types of disputes. This hinders the ability of the SMT to resolve disputes that are more complex or those involving parties outside the strata scheme.
  
  For example, the SMT does not have jurisdiction over financial institutions. In situations where the JMB fails to properly hand over to the MC, including monies in the JMB account, the SMT does not have jurisdiction to order financial institutions to transfer the funds accordingly.

• Limited remedies: While SMT’s decisions are final and binding, it has limited power to award damages or other remedies available in the courts. This may limit the ability of the SMT to provide full compensation for losses or damages exceeding RM250,000.
  
• Appeal rights: Parties can only seek a Judicial Review of SMT decisions in a High Court, which can be time-consuming and expensive, particularly for parcel owners with limited resources.

• Enforcement of Tribunal Award: The enforcement process can be complex, time-consuming, and costly. It could take three to six months to enforce the Tribunal Award in civil court and legal fees could cost between RM5,000 and RM8,000. This discourages the public when the award sum is nominal.
  
  This undermines the goal of the SMT, which is to be a cost-effective and efficient platform for strata owners to resolve disputes. Criminal enforcement is handled by the COB, and its efficiency in prosecuting a party may be affected by resource availability and existing case backlogs. 
  
• Quantum of compensation: The compensation recommended by the SMT’s technical team is based on the JKR Schedule of Rates. These rates are unrealistic for repair work in stratified buildings, due to the lack of consideration of the small quantity of work that cannot achieve any economies of scale.
  
  Furthermore, the flat rate does not consider the different quality of materials used in the affected premises. House rules such as limited time for hacking and debris removal are not considered in JKR’s rates. Thus, claimants are advised to obtain quotations to substantiate their claims to ensure a more realistic compensation amount is considered by the President.

• Repair standards and assessments: KPKT recommends EN1504 Product and Systems for the Protection and Repair of Concrete Structures for diagnosis, protection and repairs. This standard opts to restore affected building components to their original lifespan, as if no damage occurred. If the defendant or technical team recommends cosmetic or partial repairs, claimants should object and bring in their own independent expert to assess and propose repairs based on EN1504.
  
• Limited resources: As a relatively new forum, the SMT may lack the necessary resources and staff to efficiently resolve disputes in a timely manner. This can lead to delays in dispute resolution and frustrations for parties involved in the process.

What enhancements could be made to improve the SMT system?

There have been several proposals, including: 

• Expanding the SMT’s jurisdiction: Include a wider range of disputes that the SMT can handle, such as raising the claim amount limit, especially when there is a group action on disputes over the maintenance of common areas.
  
• Establishing a Higher Tribunal: Creating a Higher Tribunal where parties can appeal decisions made by the Lower Tribunal. This way, the appeal process would be clearer and more straightforward. This could help aggrieved parties to challenge SMT’s decisions in a more cost-effective way, which would be in line with the spirit of the establishment of a Higher Tribunal.
  
• Increasing resources and staff: Allocate additional resources and staff to the SMT to enhance its efficiency and effectiveness in resolving disputes. This could involve providing more funding for training and hiring more personnel to manage the growing number of disputes.
  
• Providing education and outreach: Promote awareness of the SMT’s role in resolving strata-related disputes among owners, occupants, and management bodies. This could involve educating stakeholders about the SMT’s jurisdiction, powers, and procedures, and making information about the SMT more widely available.

Overall, the SMT plays a crucial role in resolving disputes for stratified properties in Malaysia. It offers a cost-effective and efficient way to mediate conflicts, and its decisions are legally binding and enforceable in court if necessary. The SMT helps to ensure that stratified properties are properly maintained and managed, and it safeguards the rights of property owners.

This article was co-authored by Ho Suet Jing, RISM Diploma (Property Management, Valuation & Estate Agency Surveying), LLB(Hons), M.A., CLP. Special thanks is also extended to Tn Roshan Kshatriya (Former Head of Claims & Legal Section, Tribunal Perumahan dan Pengurusan Strata) for his valuable sharing and input.