Yew Huoi, How & Associates | Leading Malaysia Law Firm

Menu

PROPERTY LAW – STRATA MANAGEMENT ACT 2013 – REGULATING SHORT-TERM RENTALS: A LEGAL PERSPECTIVE ON STRATA MANAGEMENT AND STATE LAWS

ILLUSTRATIVE SCENARIO

The Management Corporation of “Happy Suites”, established under the Strata Titles Act 1985, manages a development designated for commercial use as service apartments by state authority’s mandate as per section 120 of the National Land Code 1965 (“NLC 1965”). Subsequently, during an Extraordinary General Meeting, a special resolution was adopted introducing a “House Rule” that restricts the use of units exclusively to service suites, prohibiting business activities, short-term rentals or other uses that could potentially damage the reputation of Happy Suites. Despite this, X has continued to use his units for commercial short-term rentals.

Legal Principles & Law:

• The Extraordinary General Meeting was held under the Strata Management Act 2013 (“SMA 2013”). The SMA 2013 is recognized as social legislation to enhance strata community living. As such, the SMA 2013 calls for a liberal interpretation that prioritizes community well-being.

• The Federal Court in Malaysia prefers the approach of harmonisation of status and suggests that section 120 of the NLC 1965 and section 70 of the SMA 2013 should be read together harmoniously, indicating that rights granted by one law can be restricted by another for broader community benefits.

• As such, the Management Corporation has the authority to enact by-laws under Section 70 of the SMA 2013, addressing safety and security concerns. Such by-laws are deemed justifiable and lawful even if they impose restrictions beyond those set by the State Authority.

Reference Cases:

• Federal Court (Putrajaya) – Innab Salil & Ors v. Verve Suites Mont’ Kiara Management Corporation [2020] MLJU 1563; [2020] 12 MLJ 16

• Ang Ming Lee & Ors v. Mentari Kesejahteraan Bandar, Perumahan dan Kerajaan Tempatan & Anor and other appeals [2020] 1 MLJ 281

• Weng Lee Granite Quarry Sdn. Bhd. v. Majlis Perbandaran Seberang Perai [2020] 1 MLJ 211

Back to Latest Legal Updates

Recent Post

JURISDICTION – CHOOSING THE RIGHT COURT: THE SEA JUSTICE CASE HIGHLIGHTS WHERE MARITIME DISPUTES SHOULD BE HEARD

In The Sea Justice cases [2024] 2 Lloyd’s Rep 383 and [2024] 2 Lloyd’s Rep 429, the Singapore courts tackled a key question: which country should handle a maritime dispute when incidents span international waters? After examining the location of the collision, existing limitation funds in China, and witness availability, the courts concluded that China was the more appropriate forum. This ruling highlights that courts will often defer to the jurisdiction with the closest ties to the incident, ensuring efficient and fair handling of cross-border maritime disputes. This approach is also relevant in Malaysia, where similar principles apply.

Read More »
17 November ,2024 No Comments

BREACH OF CONTRACT – FORCE MAJEURE – FORCE MAJEURE UNPACKED: WHEN ‘REASONABLE ENDEAVOURS’ DON’T BEND CONTRACT TERMS

The UK Supreme Court clarified the limits of force majeure clauses, ruling that “reasonable endeavours” do not require a party to accept alternative performance outside the agreed contract terms. This decision emphasizes that force majeure clauses are meant to uphold, not alter, original obligations – even in unexpected circumstances. The case serves as a reminder for businesses to define alternative options explicitly within their contracts if flexibility is desired.

Read More »
17 November ,2024 No Comments

NEGLIGENCE – MEDICAL NEGLIGENCE – HOSPITAL ACCOUNTABILITY REINFORCED: COURT UPHOLDS NON-DELEGABLE DUTY IN MEDICAL NEGLIGENCE

In a landmark ruling, the court reinforced the hospital’s non-delegable duty of care, holding that even when services are outsourced to independent contractors, the hospital remains accountable for patient welfare. This decision emphasizes that vulnerable patients, reliant on medical institutions, must be safeguarded against harm caused by third-party providers. The ruling ultimately rejected the hospital’s defense of independence for contracted consultants, underscoring a high standard of duty owed to patients.

Read More »
17 November ,2024 No Comments

CONTRACTS – CONTRACT FOR THE SALE OF GOODS FOB – REMOTENESS OF DAMAGES IN BACK-TO-BACK CONTRACTS – COURT DEFINES LIMITS ON LIABILITY

In a complex dispute involving back-to-back contracts, the court clarified the boundaries for assessing damages, emphasizing that a chain of contracts does not automatically ensure liability passes through. Although substantial losses resulted from delays and disruption, the court highlighted the importance of the remoteness of damages, noting that each contract’s unique terms ultimately limited liability. This decision emphasise the need for parties in chain contracts to carefully define indemnity and liability provisions, as damages are assessed based on foreseeability rather than simply the structure of linked agreements.

Read More »
17 November ,2024 No Comments

TORT – BREAKING CONFIDENTIALITY – COURT CRACKS DOWN ON INSIDER LEAKS AND CORPORATE CONSPIRACY

In a recent ruling on corporate confidentiality, the court held two former employees liable for disclosing sensitive business information to a competitor, deeming it a breach of both employment contracts and fiduciary duties. This case highlights the serious consequences of unauthorized sharing of proprietary data and reinforces that such disclosures can lead to substantial legal and financial repercussions, even for the receiving parties if they knowingly benefit from confidential information.

Read More »
17 November ,2024 No Comments
en_USEN
zh_TWZH ms_MYMY en_USEN
× Contact Us