Wither the DMC?

Thanks Lionel, Sharon, Nicky and boyscout2b for your support and comments. Please tell your neighbours and friends about the blog so they can visit and maybe provide some useful information.

Boyscout’s comment about the eventual Management Corporation (MC) and another member’s email to the blog wondering “what would happen to the DMC when GC is handed over to the GCROA?  DMC was signed between residents and GCD and not GCROA.  Is it still enforceable then or is it going to be a free for all” has prompted me to pen my own thoughts on these matters. I wish someone who has lived in a community where a Changing of the Guard (http://www.royal.gov.uk/RoyalEventsandCeremonies/ChangingtheGuard/Overview.aspx) had taken place will share the episode with us. Until we can get free legal advice from GCD’s lawyer or residents who are lawyers to help us gain a better understanding, non lawyers will have to comfort one another as best we can!

Does anyone else have the feeling that setting up a meeting or getting GCD to do something beneficial for the residents seems to take a long time, like pulling teeth, or is it just me? I am somewhat confused about who are the masters and who the slaves.

Anyway, it should not be a free for all and Clause 5 of the DMC makes this abundantly clear (emphasis mine):

“The Purchaser hereby covenants that he shall observe and comply with all the covenants contained in the Third Schedule hereto ……. For avoidance of any doubt the covenants contained in this Deed of Mutual Covenants in particular the covenants contained in the Third Schedule (Bye-Laws Governing the Ownership and Occupation of Lots) hereto shall remain binding on the Purchaser and shall survive this Deed.

So the important bye-laws shall be with us till the end of time. Please get used to it. The provisions are enforceable but the six million ringgit question persists: how to and who deals with errant purchasers or owners who do not cough up their share of the security and maintenance charges. Plus the perennial dog poo and cat nuisance, of course.

The answer is GCD for now and the MC when GCD departs from our lives, an event that might not happen until after 31 December 2015. You will find in the Deed that you signed that there is a period called “the Security Period”, running from the date of vacant possession to 31 December, 2015. During this period, GCD “shall provide security services for the said Lot and generally for the said Land” and the appointment of the service provider and the determination of the security charges are at GCD’s absolute discretion. Thus it could appoint Hicom Facility Management at will and they do not need to consult the purchasers or, okay, the GCROA. It needs to be careful about the new charges, though. If the increase is too much, the management will have a tough time ahead. On this I can almost swear.

There is nothing we can do about the appointment of the service provider except to wish for GCD to be more transparent. As I mentioned in my previous post, where is the check and balance that we are getting an arm’s length deal, particularly when GCD appoints a fellow subsidiary of the same parent? To borrow the same theme from a famous judicial comment (Rex v. Sussex Justices ex parte McCarthy, 1924), “not only must justice fairness be done; it must also be seen to be done.”

Frankly, how did this 2015 date come about? I suspect it is timed to coincide with the completion of all sales in this development. But it does get better for GCD in that it may in its absolute discretion (but of course!) continue with the provision of the security services on a year to year basis. This is a useful clause as it allows GCD flexibility in the event completion of the entire development is delayed.

It is a mystery, for me at least, how things will work out when that day arrives and GCD goes away. Does the GCROA assume the rights of GCD under the DMC to, say, sue for arrears? Bear in mind the GCROA is a mere association of residents and owners who have elected to join the association. Since it does not represent everyone, not even a majority (for now), can the Committee make decisions that affect non-members? Will GCD be able to assign the rights to the GCROA under existing laws?

Think about this but stay relaxed because the change is not going to happen anytime soon.

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