Chairman's Interested Lift Contract, a Secret Commission and a Request to Backdate Minutes

Conflicts and duties

1. Chairman's directorship in the lift company. A personal interest in a RM780,000 contract. He must disclose, abstain from chairing and voting, and the council must minute the disclosure. Council members owe duties of good faith and must not use their position for personal advantage under the strata legislation.
2. The RM25,000 'marketing support' from the current contractor. A secret commission. Accepting it is bribery and a breach of fiduciary duty, and it taints any recommendation. Under the MACC Act 2009, commercial organisations can be liable for failing to prevent bribery (s. 17A), so the firm needs procedures, not merely a policy statement.
3. The 8% project management fee. A direct financial interest in awarding contracts. It is a conflict even if disclosed; the safest course is to decline the fee or have it approved by owners with full disclosure and benchmarking.
4. Backdating minutes. Falsification of records. It misleads absent members and may invalidate decisions. Refuse, and offer to circulate a correction at a properly convened meeting.
5. The chairman's drain diversion. Interference with common property. 'Private' is not a defence where common drains or other parcels are affected; the council has a duty to investigate and act.

Professional standard: a registered property manager must act with integrity, disclose conflicts and avoid secret profit. Silence is not neutrality.

Lift contract

• Require a competitive tender: at least three bidders, technical specifications, reference sites and an evaluation matrix.
• The chairman must leave the room during deliberation and voting; minute the disclosure and his abstention.
• Recommend no contractor until procurement is complete, and document why.

RM25,000 payment

• Reject in writing; return any funds already received; inform my firm's compliance officer and the council. Record the offer and the date it was made.
• If there is any suggestion of a quid pro quo, consider reporting under the MACC Act.
• Propose a gifts and hospitality policy with a register and a zero threshold for contractor payments.

Minutes

• Refuse to backdate. Prepare accurate minutes reflecting what occurred.
• If the decision was procedurally defective, table a motion to ratify or rescind at a properly convened meeting with due notice.
• Retain original drafts, attendance records and correspondence as evidence.

Judgement: each request tests whether I serve the JMB or the individuals who appointed me. The answer must be the JMB, and the record must show it.

Investigate independently

• Inspect with an independent plumber and obtain a camera survey of the drain.
• Establish whether a common drain was diverted, whether a party wall or structural element was altered, and whether the works had written approval and by-law consent.

Act through the council

• If common property was interfered with, the management corporation must issue a notice to restore and, if there is no compliance, use its statutory powers and, if necessary, apply to the Strata Management Tribunal.
• The chairman must abstain from all council deliberations on the matter; appoint an independent council member or a third party to handle it.
• Notify the insurer and the affected owner, and keep the complaint procedurally separate from the lift procurement to avoid any suggestion of retaliation.

If the chairman blocks action

• Document the obstruction and escalate to the Commissioner of Buildings.

Professional position

• My duty is to the JMB as a whole, not to the chairman. A property manager who allows a council member to treat common property as private, while simultaneously accepting a secret payment, has no defensible position if the matter is later investigated.