Owners Of Beach Road Building Face $300,000 Debt

Source : The Straits Times, Dec 08, 2007

Amount includes legal costs and unpaid cleaning and security bills

PAST building management financial woes have come back to haunt the owners of homes, shops and offices at a Beach Road building.

Each owner at The 101 building faces the prospect of forking out about $6,000 to $35,000, depending on their properties, to cover an outstanding debt of $300,000.

The debt, accumulated in recent years, is a hotchpotch of unpaid cleaning and security bills, as well as legal costs run up in a failed bid to recover unpaid carparking fees, among other things.

One of the home owners, Madam Tan Lee Sung, 77, told The Straits Times: 'The money was not used by me. Why should I pay?'

The current management council is looking to see if its predecessors are liable for the debt. Things, however, could escalate if the debts remain unpaid, and creditors seek court orders.

The six-storey, roughly 20-year-old mixed development has 20 apartments and seven shops and office units.

A seafood restaurant and a steamboat outlet occupy the ground floor, while most of the apartments above are leased out by their owners.

Like all strata-titled buildings, it is run by a management council whose members are picked from the owners.

According to The 101's council chairman, Mr Thomas Tan, 60, who took office about a month ago, the $300,000 debt arose partly because the former councils sued some owners for alleged non-payment of carparking fees and unauthorised alteration and use of common areas, among other things.

The council lost the lawsuits and found itself saddled with legal fees.

In October 2005, the management had $168,500 in its kitty, but this was whittled down to $12,150 by April this year. Its creditors have taken out court orders to freeze its bank account.

A former council chairman, businessman Tan Fung Chuan, 50, offered a different explanation for the debts. He pointed the finger at low maintenance contributions that the owners voted to pay in 2005.

At a meeting then, an owner had tabled a resolution to cut the total management fee collected every month from $7,000 to $3,000. Mr Tan said that was barely enough to pay for the building's operating costs.

He said: 'A reasonable operating fee should be $8,000 to $12,000.'

He added that the lawsuits against individual owners were taken out on legitimate grounds, as the owners had violated Singapore's building regulations.

'We wanted to comply with the authorities' guidelines.'

At a heated meeting at The 101 on Thursday, unit owners voted to give their current council the power to take various steps to scrutinise its books for possible financial irregularities.

They have also voted to let the council claim money back from former council members and anyone else, if any wrongdoing is proven.

The owners refused, however, to raise their monthly contributions.

The council intends to try again to get the owners to agree to higher fees at another meeting soon.

Meanwhile, Mr Thomas Tan said his team would just focus on setting things right if it turned out to be a simple case of bad judgment on the part of the previous councils.

'If it is proven that this current state of finances is due to ignorance or a bad judgement call, personally, I may try to convince owners to let it go and move on.'

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COVERING COSTS

'A reasonable operating fee should be $8,000 to $12,000.'

MR TAN FUNG CHUAN, on the need to raise management fees


AVOIDING PAYMENT

'The money was not used by me. Why should I pay?'
MADAM TAN, a home owner, on the outstanding debt