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[ripley]

The Thai Condominium Act B.E. 2522 states that the owner will pay for the upkeep and maintenance of Common Property as determined by the Condo Regulations. Further, that the Owner will pay into additional  "Funds" as determined by resolution of the AGM. A rise in Maintenance fees or a new Fund (for renovation, repair or any other perceived special need) is apparently determined by the simple majority vote of an AGM provided there is a quorum (consisting of 1/4 of the total condo votes) in attendance. If there is no quorum at the AGM, the EGM (second call meeting)  decides the outcome.
My reading of the B.E. 2522 indicates that Maintenance and special funds do not fall into a category requiring 1/2  or 1/4 of the total ownership votes.
A second call EGM does not require a quorum, nor does it have a vote attendance minimum so technically a meeting of, say,  3 owners can pass whatever they like. And there are severe penalties for any owner refusing to comply.

   Now, do I have this right? Can anyone provide correction, clarity or additional information on this matter? Any recourse in law for a condo with fees unnecessarily escalating out of control?

Edited by ripley, 2012-01-11 02:36:41.

[ripley]

I've always understood that maintenance and other charges require a specific majority of the total co-owners.  An AGM tried to pass a minor increase a few years ago, was reported to the Land Office, and had to revoke the increase.
   I just checked and, no, I wasn't having a "senior moment". Siam Legal's page states that it does require a 3/4 majority of total owners to pass an increase. However, I don't see that in the English translation of the Act.
   What's the story here?

[chris2004]

My condo needed to raise more money for maintenance.  As i understand it to increase the normal common fee at least 50% of ALL the co-owners need to agree at an AGM. As we never get that many attend this was not possible.  But it seems we can charge an additional fee using only 50% of co-owners ATTENDING an EGM.  This is the route we took to get an additional 5million baht of funding.  Our standard common fee is fairly low at 20 baht per sq m per month.

[ripley]

Just read a translation of B.E. 2522 which contains amendments made in 2008. I think this is the most recent.

It states that a second-call meeting (EGM due to lack of quorum at AGM) must have not less than 1/3 of joint owners total votes to pass a resolution.

So I guess that puts paid to the notion that a 2nd call mtng. needs only a simple majority?

Trawling thru the various versions/translations of Thai Condominium Law is certainly baffling and frustrating.

Edited by ripley, 2012-01-11 11:12:25.

[Delight]

I would say  that you have it about right.
The Co -owners are responsible for the maintenance of the building.  This they do via the committee.

So as such they should attend General meetings.

Lack of attendance, due to either apathy or as a boycotting tactic -cannot interfere with the running of the building.
I think that the basis for posing this question is the phrase 'Unreasonable Rise in fees.'
If the building  manager is operating within the law then on a monthly basis detailed income -expenditure data should be displayed .

A 30% increase in fees does ,I agree ,appear to be unfair on face value.

It becomes   reasonable if It can be justified .

A well detailed agenda is useful in this regard.



There is no requirement for a 75% vote on any issue.  That was not the case with the Act as originally presented.

A change of a Juristic Person Manager will always   require   a winning vote which  comprises at least 25% of total  building  vote.

Certain issues that require a 50% vote can pass on a winning vote of at least  1/3 rd of total   building vote (at the 2^nd Meeting)

Sinking funds only require a simple majority-even at a meeting without a 25% quorum. –unless the Condo Regulations  specify  something else.

Increasing the basic maintenance charge does require a 50% vote.

However an increase designated -'Special Assessment ' can be authorized with a simple majority.

This legally occurred at an  EGM  in the condo where I live. The meeting attracted 26%(by building vote –bodies and proxies) attendance ..The proposal got 100% 'Thumbs Up'  from the attendees. But a simple majority would have achieved the same result.

I attach a couple of JPEGs in relation to the Condo Act (translated version -therefore has  no legal authority)

Attached Files

•  Section 44- Resolutions by majority vote.jpg   54.67K   8 downloads
•  SECTION 48 -RESOLUTIONS REQUIRING 50% VOTE.jpg   274.03K   12 downloads

[ripley]

Interesting and informative post. Thanks.

I'm not certain that Sinking Fund and Special Assessments require only a simple majority vote of those people and proxies present at an AGM or EGM.

The Sinking fund, I believe, is outlined in a condo's Regulations. A change in Regulations requires 50% of the co-owner vote.

Special Assessments vary wildly in purpose and cost to the owners. They amount to the same thing as a rise in maintenance fees, can be and are sometimes used as a way to get around proposing an actual maintenance fee increase. If allowed, these could easily mount up and sky-rocket the costs of condo living.  Although they are passed at times using a simple majority, with no objection from the owners, I have questions about their legality. I wonder what the Land Office or courts would have to say about these if they were challenged. I can't find chapter and verse on specifics regarding special assessments in B.E. 2552 or 2551, but I could be missing something.

I agree that the cost of living increases, rises in Maintenance fees are sometimes necessary, and this is frustrated by the lack of attendance to AGMs. Getting a 50% vote can be difficult and the condominium shouldn't have to suffer losses of services and upkeep. More work in the areas of educating the co-owners about the importance of participating in decisions, encouragement and facilitating of proxy votes, as well as earning their trust is part of the answer here.

Edited by ripley, 2012-01-22 01:19:03.

[Darrel]

I attended the AGM of a large building a little while ago. The chairman pointed out several times that a 50% quorum had never been achieved in the entire history of the building.

Several of the co-owners attending didnt register, as they specifically didnt want a quorum to be achieved as that could entail an increase in the maintenance fee. They wont escape the special charge though.

[ripley]

Interesting.

   It somehow never occurred to me that owners were sabotaging meetings this way instead of taking the opportunity to work out solutions. Naive of me! The only thing I can say in their defense is that an alarming number of condos completely ignore the laws  regarding proper condo administrative procedure, attention to input from owners and full disclosure at AGMs. Often co-owners enter a condominium which ignores the law and then don't know how to correct the situation. Often they enter an AGM without being supplied the necessary documents and statistics upon which to make an advised decision. The owners naturally become frustrated & in some cases feel that boycotting the AGM is their only recourse.

   The attempt to prevent a quorum seems like a very short-sighted and irresponsible tactic to me. By so doing the owners prevent other necessary  resolutions from being passed. They miss the opportunity to work out differences with the administration. They frustrate the best attempts of an honest administration, while having a limited effect on a dishonest one. They force a "Second Call" meeting which requires no quorum and a smaller percentage of co-owner votes to pass resolutions, thus sabotaging their own interests. (That is, assuming the condominium is abiding by lawful procedures.)

   Nor is it correct, in my opinion, to attempt to circumvent the proscribed percentage of votes for a maintenance increase by calling it a "Special Assessment". I do see mention of Special Funds in the Act, but no detail.

   Most of this really boils down to the fact that, on both sides of the equation, nobody can be arsed to pin down and act upon the laws as they are written and practiced in court and by the Land Office/ Competent Officers. They gloss over these things and hope nobody will notice or if they do notice they won't challenge. If a thing is allowed to happen, many take it as read that it must be legal!

  A "Second-Call" meeting doesn't require a quorum and resolutions are passed by a 1/3 majority of total co-owners. Do we know if resolutions regarding items 1 thru 6 in Section 43 of B.E.2552/2551 are included? (#5 item is maintence fee changes).

   I recommend great caution when dealing with "Special Assessments". They can be ruinous. It's worth pinning down the working Thai Law about these. I certainly intend to continue research, for my own edification.

Edited by ripley, 2012-01-22 21:21:09.

[Darrel]

ripley, on 2012-01-22 21:18:38, said:

   The attempt to prevent a quorum seems like a very short-sighted and irresponsible tactic to me. By so doing the owners prevent other necessary  resolutions from being passed. They miss the opportunity to work out differences with the administration. They frustrate the best attempts of an honest administration, while having a limited effect on a dishonest one. They force a "Second Call" meeting which requires no quorum and a smaller percentage of co-owner votes to pass resolutions, thus sabotaging their own interests.

Indeed. The maintenance fee in this particular building is under 5000B per unit per year and has never been increased since the building was built. So it takes a special sort of idiot to worry about it being voted up as even if it was doubled (which would probably still be less than inflation over the time) it would still be absurdly cheap.

[ripley]

My apologies. I keep referring to current condo law as B.E. 2552 when it is, of course, B.E. 2522.

Darrel -

  Just curious - how has your condo managed to operate with no increases since registered? In what condition?

[Darrel]

Special charges double the maintenance fee. The condition seems fine.

[Delight]

Special Assessment  ( and Sinking  Funds) can save condos.

In relation to the condo where I live, achieving a 50% Vote to increase fees would  either be impossible or at least very difficult(my opinion)

In the event it was achieved (as a Special Assessment)  at  an EGM with 26% of total building  vote.-It raised the fee by 25% p.a. and this Assessment  has a 3 year life)

The management company that was appointed, after the Condo voted to get rid of the original developer /manager, advised us of the approach.

With out  it the  condo would be in a mess.

i.e. Not enough money  to give a good service –which results in non-payments from some  Co-owners  as a protest –which then results in a further reduction in service etc.etc.
A condo can  lose  critical mass –such that it can never be pulled back and ends up a bankrupted  mess.

Of course in some circumstances it is the inefficient use of resources.

(A condo which is the  older sister of the one where I live is a case in point.
It is a complete mess- mostly as a consequence of inherent  structural problems that been ignored by the co –owners (and the developer))

The Condo Act is there to avoid this.

The reason why condos fail is not because of unscrupulous/incompetent managers ,it is entirely a consequence of Co –owners  who ignore their responsibilities  and are seduced into complacency  by the  prospect of long term low fees.Most co -owners only look at the fees.

In truth you also need  a body of co –owners (by law at least 20% of the building vote)who are prepared to go the extra mile  -and within that 20% a few who  are good managers and organisers.

The Act is only weak –in my view-in relation to a lack of a provision to obtain unpaid fees from delinquent co –owners- via a Civil court .

Maybe the Thai Civil code covers this   in the   respect of Non –Payment of Debt  in  a  general sense.

[ripley]

"The reason why condos fail is not because of unscrupulous/incompetent managers ,it is entirely a consequence of Co –owners who ignore their responsibilities and are seduced into complacency by the prospect of long term low fees."

   There are indeed unscrupulous/incompetent managers & Committees responsible for the deplorable conditions in some condominiums. There are also irresponsible and incompetent co-owners who only look at the fees without troubling to insist upon and study the audits and other financial documentation.

  I can certainly see your point about the difficulties of achieving a 50% vote and how an insufficient maintenance fund can bring down a condominium. The inevitable increases in the cost-of-living which affect us all make it necessary to raise the fees from time to time. Perhaps  reasonable, regularly scheduled automatic cost-of-living Maintenance Fee increases - tied to the actual rises in cost-of-living across the board - could be sought and pursued. Beat the bushes, get the proxies and votes in by straightforward means, working well in advance of an AGM. Worth the extra effort to be rid of the problem once and for all.

    A local legal-eagle expressed an interesting opinion. Any proposal for a Special Assessment must be specific as to need and purpose. He could think of only 4 purposes: 1.) New and unforeseen taxes or other govt. levied expense 2.) Emergency repair of Common Property 3.) Improvement, alteration or addition to Common Property/ Facilities 4.) Topping up the Sinking Fund.

Aforementioned Legal-eagle pointed out that:

1.) May qualify as a legitimate extra expense, requiring a Fund and not mentioned in the list of proposals requiring 50% total vote
2.) Should be covered by the Sinking Fund (as emergency repairs are the stated purpose of that fund)
3.) Is either a Maintenance issue - as such should be requested as a Maintenance increase; or falls under the sections in Thai Condo Law concerning Common Property issues. In neither case will a simple majority vote cut it. Maintenance and Common Property issues require a vote of 50% total co-owners at an AGM, (minimum 1/3 total at a Second Call mtng.? Do we know that yet?)
4.) May qualify as a legitimate extra expense requiring a fund. Condo Law isn't specific regarding Sinking Fund vote requirements.

Edited by ripley, 2012-01-24 01:09:17.

[Delight]

My thoughts are that you would do better to speak with an accountant (prefereably one with knowledge of Condo running costs) rather than a lawyer.

Let's not lose  sight that the committee's raison d'etre is to produce happy customers .i.e. happy co-owners.

The Special  Assessment   in the first instance will be used to address wrongs of the past-the fee is too low for a variety of reasons.
Once it is updated  then on a fixed frequency(say every 3 years) it can be reviewed to deal with the impact of inflation (or deflation )

[ripley]

"The Special Assessment in the first instance will be used to address wrongs of the past-the fee is too low for a variety of reasons.
Once it is updated then on a fixed frequency(say every 3 years) it can be reviewed to deal with the impact of inflation (or deflation)"  

   Given the many difficulties in achieving a legitimate increase, this seems a pretty fair and reasonable method of getting a Maintenance Fund back on track.

   For many reasons, tho, the legality of Special Assessments on the basis of a simple majority vote needs to be researched and tested. Often these Assessments are for purposes other than necessary Maintenance Fund adjustments.

   Do you think it would be a good idea to amend the condo's Regulations to include a fixed frequency cost-of-living increase/decrease?

[Delight]

Good Point.  I think that It's up to the individual CJP.

In the condo where I live the Special Assessment only has a  3 year  life -therefore  a review automatically occurs.


I sense that some contributors to this blog are not convinced as to to legality and scope/limitations  of a Special Assessment .

Defining that and including in the Definitions .=may be of use.

Are my senses correct?

[ripley]

I agree that "Special Assessments" would make a useful addition to the Glossary of Condominium Terms. But first there needs to be more legal research to pin down that definition. My questions are:

-What constitutes a legitimate Special Assessment and what should, in Law, be classed instead as a Maintenance Fee or other category?

-What circumstances require a proposal for a Special Assessment?

-What is the law regarding voting ratio for a Special Assessment in AGM and Second Call mtngs.?

   May I ask, when your administration asked for and received a Special Assessment how was the proposal termed? What reason was given to the co-owners?

   You know, another useful thing that could be done would be for all interested parties to exchange ideas about how to increase the attendance/proxy votes in an AGM. Also, what are the most effective ways to present a proposal and get it passed? I'm well aware of the recalcitrance, studied ignorance and indifference of some co-owners, but I think much of that could be overcome with a period of sustained effort on the part of the administration. A good "brain-storming" session might be useful.

    Obviously, if we have at least 50% of total votes represented in an AGM it is then only a matter of selling a proposal to them. It passes or it doesn't - legitimately and with no lingering questions..

[ExpatJ]

As long as they use the increased maintenance fees to pay for building upkeep, this is a good thing. Generally fees are  way too low for Pattaya/Bangkok condos as i guess they are tyring to lure short sited buyers who care about saving a few bucks now but dont realise their building will soon deteriorate.

Im paying about 300 US$ per month fees for my condo (that i rent out)- for that i get a large well maintained garden, 2 pools (in door heated, outdoor), squash , tennis, excellent gym (over 20 running/bike/rowing machines etc), playground, jazuzzis, steam rooms etc.  Its also much easier to find tenants when the propoerty is well maintained.

[Darrel]

ExpatJ, on 2012-01-26 10:04:39, said:

Im paying about 300 US$ per month fees for my condo (that i rent out)- for that i get a large well maintained garden, 2 pools (in door heated, outdoor), squash , tennis, excellent gym (over 20 running/bike/rowing machines etc), playground, jazuzzis, steam rooms etc.

That's nearly as much as my rent! And I have a 65sqm unit with a very nice view.

Personally I'm not at all interested in any building facility apart from an elevator and one outdoor unheated pool.  Anything else is just a complete waste of money as far as I'm concerned, and even if I had a billion USD in my pocket I wouldn't want to live anywhere that had such facilities.

[ripley]

"As long as they use the increased maintenance fees to pay for building upkeep, this is a good thing. Generally fees are way too low for Pattaya/Bangkok condos as i guess they are tyring to lure short sited buyers who care about saving a few bucks now but dont realise their building will soon deteriorate.
Im paying about 300 US$ per month fees for my condo (that i rent out)- for that i get a large well maintained garden, 2 pools (in door heated, outdoor), squash , tennis, excellent gym (over 20 running/bike/rowing machines etc), playground, jazuzzis, steam rooms etc. Its also much easier to find tenants when the propoerty is well maintained. "

   If your building had these standards and facilities when you bought in, you will have known what you were getting into & made the choice to pay a hefty Maintenance Fee. Or, perhaps, the building had fewer facilities & your fellow Co-owners voted in improvements. Fair enough & each to his own.

   For those who chose a more basic Condominium with a lower Maintenance Fee it can be ruinous to have that fee pumped up to $300/mo. for facilities they never wanted and don't require.

   This is one reason why the AGM is so vital to the interests of the owners.

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[ripley]

I recently replied to a person who was having problems getting attendance to AGMs  - the old, old problem which means nothing ever gets done & discussed again & again.

  Had the thought that perhaps the all-out thrust of effort ought to be to change the Regulations of a condo to require attendance to the AGMs either in person or thru proxy vote. The Regulations carry a lot of weight legally and are no more difficult to vote in than say Maintenance increases, etc. I reckon anything that can increase attendance of AGMs will work to get things done and end a lot of frustrations.

   I'll add here that I think there are condo administrations who don't want well-attended AGMs, who encourage owner indifference so that they can run things as they please unhindered.

[Johnny_Aloha]

I do not agree and the Land Office in Pattaya also does not agree. Jomtien Complex Condotel at their 2010 AGM had over 35% of all co-owners votes represented and voted by 95% of those voting  voteed in favor of increasing the Maintenance Fees for every co-owner. However, only about 20% of the total of all co-owners actually voted their votes on this issue and the Land Office deemed that one third of all co-owner votes were required to change the Maintenance Fees so disapproved the AGM minutes, specifically this vote.

The Thai Supreme Court before the enactment of the July 4, 2008 admendment to the Thai Condo Act did decide in the favor of a single co-owner who sued his condominium for increasing the Maintenance Fees without the required percentage of co-owner votes, however, they stated that a Special Fund for specific, non-routine maintenance kind of work, e.g. painting the entire building,  could be approved by a simple majority at a second meeting but the funds approved could only be used for the specific item(s) that was voted on. Unfortunately, unknowing or unscrupulous Committees and JPMs have used these Special Funds on occasion for their own agenda leaving the spefific items approved without monies to accomplish the work. Both scenarios are being contested in numerous court cases with no new verdicts to date to my knowledge.

I advise having registered co-owners taking their passports and condo deeds to their local Land Office and get an interpretation of the law from them as they are the ones responsible for enforcing the Thai Condo Act.

I have attached my version of the Thai Condo Act showing all revisions in color coding for anyone's use with the understanding that there may be errors and it certainly is not official.

Aloha, Johnny Aloha,

Attached Files

•  !1 Thai Condo Act 2522 ('79) with rev No2- 2534 (91), No3-2542 (99) & No4-2551 (08)-r10 (w Penalties & retroactive info) Thai a.doc   525K   13 downloads

[ripley]

The attachments above represent an impressive amount of thought and labour to sift through the complexities of Thai Condominium Law past and present. I, for one, intend to read through these with the attention they deserve before making any in-depth comments (should I have any!)

. However, a careful study of Condominium Law with the amendments contained in B.E. 2551, plus initial scanning of your text, still indicates to me that "Special Funds/Assessments" for the most part fall under categories which require 50% or 1/3 of total co-owner votes to be passed. The law as it stands does not reflect the Supreme Court opinion you mention regarding a simple majority vote.

  Collecting funds for a stated purpose and then diverting them to another purpose without permission legally obtained is fraud - pure and simple - although the wheels of the justice system may grind slowly.

  My compliments to you for your superb efforts and contribution, despite the hours of work ahead of me to study them!

[justcruisin]

Another thing to keep in mind is that Condo voting rights are by percentage of ownership of the total area of the rooms, example, a large two bedroom unit has proportionally more voting rights than a small studio.

The studio may have .86% of the vote and the large unit may be for example 1.20%.

[Delight]

. However, a careful study of Condominium Law with the amendments contained in B.E. 2551, plus initial scanning of your text, still indicates to me that "Special Funds/Assessments" for the most part fall under categories which require 50% or 1/3 of total co-owner votes to be passed. The law as it stands does not reflect the Supreme Court opinion you mention regarding a simple majority vote.

Perhaps Ripley could explain this statement.

Section 48 of the Act makes no reference to any kind of maintenace funding.

For convenience I attach the relevant passage –extracted from the Johnny_ Aloha contribution.

SECTION 48, A resolution on any of the following matters shall not be less than one-half of the votes of the total number of the votes of all co-owners combined:
   (1) a purchase of immoveable property or an acceptance of immovable property of binding value as common property;
(2) disposal of common property;
  (3) an approval granted to any one co-owner for construction that has effect to the common property or the outside appearance of the building at the expense of such co-owner;  

   (4)  an amendment of the rules in connection with the use of management of the common property;
   (
   (5) amendment that changes the ratios of the joint payments in the rule pursuant to Section 32 (8);
   (6)  a construction that modifies, adds to or improves the common property;
(7)  a management of common property that provides benefits from use, (for example, the lease of common property)

If the co-owners do not attend the meeting in the number to constitute the majority votes pursuant to paragraph one, another general meeting shall be appointed to be held within fifteen days from the appointed date of the previous meeting.  For this new meeting the resolution on matters prescribed in paragraph one shall be determined by one-third of the total co-owners combined.

What can Ripley see that I cannot?