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5 matters Sarawak JMBs and MCs don’t take seriously enough
The Strata Management Ordinance 2019 gave Sarawak’s strata communities real rules and rights. Familiarisation and enforcement of these rules are key to tangible improvements.
⏳ 2 terms office-bearer cap | 📜 75% votes for by-laws | 🚩 49% nominee cap | ⚖️ RM250k Tribunal limit |
If you own a unit in a strata development in Kuching or Sarawak the Strata Management Ordinance 2019 is the legislation governing your use. However, this is just the foundation.
Additional regulations and directions that affect this are the:
Strata Management (Management and Maintenance) Regulations, 2022
Strata Management (Management and Maintenance) Directions, 2024
Collectively, these set out how your building gets run, who runs it, and what happens to your monthly contributions. Before it, Sarawak’s strata sector ran mostly on developer-drafted deeds of mutual covenants and whatever house rules a building happened to inherit.
The Ordinance introduced the Joint Management Body (JMB) for the period before individual strata titles are issued, and the Management Corporation (MC) that takes over once they are, each with an elected committee, proper accounts, and a dedicated Strata Management Tribunal to settle disputes without going to court.
It’s a solid piece of legislation. The problem isn’t the law on paper it’s what committees actually do with it once the AGM ends and daily life takes over.
Here are five areas where things routinely slip.
ISSUE 01
📜 By-laws vs the deed of mutual covenants
When you bought your unit, the developer most certainly required you to sign a Deed of Mutual Covenant (DMC). This set out the rules of communal living. DMCs tend to be one-sided in the developer’s favour, and because they’re signed at the point of sale, they often don’t reflect the law by the time anyone lives there. However, they still linger on.
WHAT THE LAW ACTUALLY ALLOWS Under Sections 30 and 63 of the Ordinance, a JMB or MC can adopt its own by-laws by special resolution (a 75% supermajority vote at a general meeting). Once passed, by-laws bind every owner, tenant, and occupier (including the developer) regardless of what the old DMC says. However, and unfortunately, most by-laws don’t address what happens to the DMCs which means that it actually remains enforceable. |
Here’s the catch, flagged by our firm in a 2025 legal update: the Ordinance only invalidates a deed or contract if it’s inconsistent with the Ordinance itself, but it doesn’t automatically cancel the DMC. So unless the committee actually takes the extra step of passing proper by-laws, or entering into a deed of cancellation, the outdated, developer-drafted DMC just keeps quietly running the show by default. Most committees never get around to it. Out of an abudence of caution, the parties should also enter into a deed of cancellation.
The Commissioner of Buildings issued the Strata Management (Management and Maintenance) Directions in December 2024 as a default set of rules covering security, pets, renovations, and common property use that applies automatically until a development adopts its own by-laws. That’s a genuinely useful safety net, but it isn’t a substitute for a committee doing the work. The Directions only function as a guideline once proper by-laws exist, and there’s still real uncertainty over how they interact with an old DMC that was never formally terminated. Overlapping issues should be addressed head-on.
ISSUE 02
⏳ Committee term limits
The Ordinance doesn’t leave committee tenure open-ended. Schedule 4 states:
THE ACTUAL LIMITS Chairman, secretary, and treasurer terms are capped at 2 consecutive terms. Ordinary committee members are capped at 3 consecutive terms. Either limit can only be extended by a special resolution passed by the owners, not by the committee itself. |
What usually happens is that the same handful of names often just keep reappearing on the committee year after year, with no special resolution ever formally passed.
In some cases, the developer just can’t let go of the property to avoid a change of guard that can accurately assess and manage the property. Sometimes because nobody at the AGM realises the limit exists, and sometimes because attendance is too thin to challenge it.
Every committee member’s office technically expires at the conclusion of the next AGM regardless of term count, meaning re-election has to happen properly every single year.
The result of skipping all this is a committee that owners have less real power to change, which is exactly the opposite of what the rule was designed to prevent.
💡 WHAT OWNERS CAN DO Before the next AGM, count how many consecutive years your chairman, secretary, or treasurer has actually held that specific role. If it’s past the cap and no special resolution extending it is on record, that’s a fair question to raise on the floor. Also, the Strata Management Tribunal can compel the body to hold a proper AGM and fresh election under the Tribunal's jurisdiction. If there's a specific decision an owner actually wants to contest, like a large expenditure or a contract signed during the overstayed period, this can be a ground to challenge that decision's validity directly. |
ISSUE 03
✅ Skipping “Positive Authorisation” at the AGM
A committee can’t just decide everything on its own. Several matters legally require the body of owners to actively pass a resolution at a general meeting.
It has to be passed and not simply go unopposed:
Adopting or amending by-laws — special resolution (75%)
Taking out insurance beyond the compulsory policy — special resolution
Setting the sinking fund contribution rate and the interest rate for late payments
Approving the annual budget presented at the AGM
⚠️ WHY THIS GETS MISSED Many committees treat silence in the room, or a quick show of hands with no real notice period, as good enough. It isn’t. The Strata Management Tribunal has express power to nullify a resolution passed at a meeting where due notice wasn’t given, where voting rights were wrongly denied, or where meeting procedure wasn’t followed. A decision made this way can be unwound later sometimes after money has already been spent on it. Liability of committee members can follow later as it can be seen below. |
An special resolution needs at least 21 days’ notice of the motion, and a “comprehensive resolution” needs 30 days’ notice plus a 60-day voting window with 90% support.
In Sarawak, special and comprehensive resolutions must be made by poll. They cannot be made by simple show of hands irrespective of the participants of the AGM agree. A poll is a formal, counted vote where each eligible owner or proxy casts an individual vote, usually on a ballot paper, and every vote is recorded and tallied. The share units are weighted.
Rushing a big decision through with a few days’ notice under the heading of miscellaneous matters, however well-intentioned, is exactly the kind of shortcut the Tribunal can unwind.
💡 WHAT OWNERS CAN DO If a decision affecting your money was made without a clearly worded motion, proper notice, and an actual vote count in the minutes, you’re entitled to ask for the resolution that authorised it and to challenge it at the Tribunal if one doesn’t exist. |
ISSUE 04
🚩 Conflict of interest
The Ordinance builds safeguards against a committee being captured by one owner:
No subsidiary proprietor’s nominees may make up more than 49% of the committee;
Co-owners of the same unit can’t both stand at the same election;
Anyone with maintenance or sinking fund arrears isn’t eligible to run for a position
The property manager or managing agent must be independent of the developer
Section 77 of the Ordinance requires the property manager or managing agent to be independent. The reason for this is straightforward: even a committee that’s properly elected and free of nominee capture can still be neutralised if the person actually running the building day-to-day is effectively answerable to the developer rather than the owners. Even after the JMB is created, the interests of the developer can diverge on how the developer’s own defect deposit under section 81 gets assessed, or how aggressively arrears on parcels the developer still holds actually get chased.
📰 WHAT THIS LOOKS LIKE IN THE REAL WORLD “a small group of committee members misused funds by awarding contracts to associated vendors at inflated costs, depleting the sinking fund,” with financial reports delayed or lacking transparency leaving too little money for critical repairs when they were actually needed." Source: Bernama, “Maintenance Fees: A Snowball That Can Trigger An Avalanche,” March 2025 |
Owners have a real weapon against this. Section 59 allows owners to inspect any record which the management body submitted to the Commissioner for a small fee. This enables owners to access documents in cases where the management is not cooperating.
💡 WHAT OWNERS CAN DO Inspect the accounts in preparation for the AGM even if nothing seems wrong. And ask directly, in writing, whether the appointed property manager or managing agent, or its directors and shareholders, has any ownership, employment, or ongoing commercial relationship with the developer. No straight answer is itself worth treating as a red flag. |
ISSUE 05
🪪 Hiring an unlicensed property manager
Property managers and managing agents aren’t just appointed under the Ordinance, but they also have to be registered under a separate federal law, the Valuers, Appraisers, Estate Agents and Property Managers Act 1981 (Act 242), which applies throughout Malaysia, Sarawak included. That’s where the Ordinance’s own definition of “property manager” actually comes from. Registration is a real professional qualification, not a formality. It means passing the Board’s standards, being subject to its disciplinary process, and being answerable to a regulator if something goes wrong.
THE BOND REQUIREMENT FOR UNREGISTERED AGENTS The Strata Management (Management and Maintenance) Regulations, 2022 address this directly: if a JMB or MC engages someone to manage the property who is not a registered property manager, that person must first lodge a bond with a bank, financial institution, or insurer, specifically to cover any loss caused by their failure to account for money they receive or hold. The bond has to be at least RM50,000, or the equivalent of twelve months’ management fees, whichever is higher. |
🚨 THE RISK IF THIS GETS SKIPPED An unregistered manager operating without that bond in place is handling your maintenance and sinking fund money with no financial safety net behind them if something goes wrong. The exposure isn’t only the JMB’s, either: under Act 242 itself, practising as a property manager without registration is a criminal offence, carrying a fine of up to RM30,000, up to three years’ imprisonment, or both, plus a further RM1,000 for every day the offence continues. The Board has previously estimated around 5,000 unregistered property managers operating nationally, and has pushed for the strata legislation itself to be tightened further to close this gap — this isn’t a rare edge case. |
💡 WHAT OWNERS CAN DO Ask the property manager or managing agent for their registration number with the Board of Valuers, Appraisers, Estate Agents and Property Managers, and verify it independently with the Board rather than taking a business card or company website at face value. If your JMB or MC is already using someone unregistered, ask specifically whether the bond required under the Regulations has actually been lodged. The answer “we didn’t know we needed one” is a red flag on its own, not a reassurance. |
THE STAKES
🚨 What Happens When a Committee Breaches the Ordinance
Everything above matters because a JMB’s or MC's power exists only because the Ordinance created it. When a committee approves something that breaches the Ordinance or its Regulations, several consequences kick in at once.
📜 THE APPROVAL ITSELF CARRIES NO LEGAL WEIGHT You can’t vote, contract, or agree your way around a statutory requirement. A resolution that breaches the Ordinance doesn’t become valid just because it passed with a majority in the room. The Ordinance’s own provisions in section 136 against contracting out of it exist specifically to close that door. Where the Ordinance, Regulations or Directions give a discretion, they use "may". Some discretion is conditional on approval at an AGM subject to special or comprehensive resolution or by the Commissioner. If the condition is not satisfied, the discretion cannot be validly exercised. |
⚖️ ANYONE AFFECTED CAN TAKE IT TO THE TRIBUNAL A parcel owner or subsidiary proprietor can bring a claim to invalidate meeting proceedings where the Ordinance was contravened, to nullify a resolution passed without due notice or where voting rights were denied, or to revoke a by-law amendment. On top of that, the Tribunal can rectify, set aside, or vary a contract or by-laws, order costs against the committee, and award damages for any resulting loss. |
🏢 The Commissioner of Buildings has investigative powers to search, seize, to compel people to answer questions and the ability to prosecute. A pattern of unlawful approvals can escalate from one owner’s Tribunal claim into a full investigation of the committee itself.
🚨 COMMITTEE MEMBERS CAN BE PERSONALLY, CRIMINALLY LIABLE This is the sharper edge. Where a JMB or MC fails in duties like proper accounts or a proper handover, the Ordinance doesn’t stop at the JMB but makes every member of the committee guilty of an offence, with fines up to RM250,000 or up to 3 years in prison. There’s a narrow escape in section 24(6) of the Ordinance: a member avoids liability only by proving both that the breach happened without their knowledge, consent, or connivance, and that they took reasonable precautions and exercised due diligence to stop it. A member who voted for the breach, or knew and stayed silent, has no defence. Taking reasonable precautions in some cases involves seeking legal advice. I asked my friend who is a lawyer is unlikely to be sufficient professional advice for these cases. |
🏦 Maintenance and sinking fund money is held in trust for owners, not owned by the JMB. Directing trust money somewhere the Ordinance doesn’t permit isn’t just a bad decision but risks committee members personally accounting for how that money was used.
💡 WHY THIS MAKES THE PAPER TRAIL MATTER Proper minutes, a recorded vote count, and a documented dissent at the time are what separate a committee member from personal exposure later. “I didn’t agree with it” only works as a defence if it’s actually on the record. |
Disclaimer
This article was generated with AI assistance and reviewed by a lawyer before publication. However, it's provided for general information only and isn't legal or professional advice. Of course, any errors should be attributed to the AI not the human reviewer. Please verify anything important independently and consult us where it matters. See our services here if you need more information.
