Building arbitration effectiveness questioned

The Arbitration Centre for Building Management Affairs will open in June but some experts doubt that this new alternative will do anything to slow the increase in disputes.
The new body has the ambitious goal of ‘solving conflicts quicker’ through conciliation and arbitration, the head of the Juridical Affairs Division at the Housing Bureau (IH), James Iam Lei Leng, said yesterday. “There are already too many cases in court. It takes too long,” he added.
The arbitration centre could reach a final decision in about six months, IH president Tam Kuong Man said. The process is free of charge and legal representation is non-mandatory, he added.
The centre ‘has a lot of potential’, lawyer Carlos Duque Simões told Macau Daily Times, “but everything will be up to the incentives given and people’s responses”.
A view shared by the director of the Building Management Resources Centre of the General Union of the Neighbourhood Associations, Chan Pok Sam.
The new body will have a ‘positive role’ in helping to settle disputes but if one of the parties involved doesn’t accept this alternative, the centre will become ‘useless’, he told TDM.
“When both sides want to solve a conflict, it’s pretty easy to do so,” Iam said. The difficult part is when one of the sides refuses to go through arbitration, he acknowledged.

Lengthy time wasting

“It will be difficult to put into practice,” Simões bemoaned. “I believe it will be more used in cases where both parties are in an equal position, especially disputes between two tenants,” he said.
But most conflicts happen in situations of misappropriation of commons parts, the lawyer underlined.
“There was a large period during which commons parts were not well defined. So now there are hundreds of buildings in Macau in which commons parts were misappropriated by management companies or tenants,” he said.
Although most known cases involve rooftops, Simões says there are more serious incidents involving areas with economic value, namely parking lots and outdoors areas.
“In these situations, it’s doubtful that these companies or tenants will be willing to accept arbitration. They are reaping benefits from the misappropriation so they will try to drag out the situation for as long as possible,” he said.
The solution could be to make arbitration mandatory before any of the parties could head to court, something that already happens in other jurisdictions, the lawyer stated.
However, that idea was rejected by the IH. “We want this centre to be an alternative where solutions of consensus can be reached, not another mandatory court,” Iam told MDTimes.

A ‘whole universe’ of cases

The Property Management Business Association chairman Lao Kam Sheng, told TDM legislative changes are needed to give the IH more power to execute the decisions of the arbitration centre.
But Iam stressed that in some situations the decisions of this new body will be final, and it won’t be possible after the process to approach the court.
The centre’s regulation, published in yesterday’s Official Gazette, states that an arbitration decision “has a similar enforceability to a sentence imposed by the Court of First Instance”.
Since 2006 the local courts have received a total of 63 cases that can now be handled by the IH arbitration centre, Tam disclosed. So far this year 17 cases have been put forward.
Simões expressed his concern that the issue is far more extensive. “If there is one thing Macau isn’t lacking, it’s building management disputes. There is a whole universe of cases out there,” he emphasised.
The local property market has developed a system that ‘ignores most regulations’, the lawyer explained.
“Certain practices have developed, along with the law, and many people are convinced that [is now] the law. Very often the building developer or manager takes advantage of that ignorance,” he bemoaned.
The arbitration centre’s preliminary regulation was presented in September 2008 and the body was originally scheduled to open in 2009.