Gated community legislation is still pending

Sherry Ann McGregor
Sherry Ann McGregor

February 24, 2020

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I published an article concerning the proposed gated community legislation on March 26, 2018, shortly after an announcement was made by the Prime Minister that a Gated Community Legislation was being prepared and would be placed before Parliament. According to the then Minister of Housing, the draft legislation should be expected during the 2019-2020 fiscal year.

One concerned reader reminded me about the issue, which is when I noted that there has been no further mention of the proposed new legislation since in or about 2018, although the 2019-2020 fiscal year is almost over. The reader also added some context that may not be readily apparent to some persons, by explaining that she is a Jamaican living overseas, who purchased a townhouse that she hopes to return to Jamaica to live in after she retires. She said that, like most homeowners, while she diligently pays her monthly maintenance fee, forty per cent of her neighbours are delinquent about meeting that obligation. She lamented the fact that this experience has caused her to reconsider her retirement plans, because the absence of legislation that will compel homeowners to fulfil their obligations to maintain gated communities could leave her without security and depreciate the value of her home.

FINANCIAL PROBLEMS

This is the problem that unchecked delinquency brings – cash shortfalls prevent the homeowners association (if there is one) from covering recurring expenses to pay electricity and water bills, security guards and gardeners. There is no law that even compels a homeowner to paint his house or cut his grass in a gated community, and this can make life very difficult. Of equal concern, is the fact that many older gated communities have structures in the common areas, such as guard and pool houses, that fall into disrepair or ruin because there is no consensus among homeowners to pay a cess to cover the cost of capital projects.

It is a fact that most new homes that are advertised for sale in Jamaica are either in gated communities or strata developments. Prospective owners find them attractive for many reasons, such as shared costs and security. However, when shared costs cannot be met, security risks will inevitably increase and thereby erode one of the best features of communal living.

Below is a reminder of some of the important features of effective laws to govern gated communities:

  • Each gated community must establish a legal entity, such as a corporation, that is comprised of various homeowners;
  • That corporation must be registered with a central monitoring authority;
  • Standard by-laws must be incorporated into the constitution of all corporations, subject to certain variations depending on the peculiarities of the gated community in question;
  • The corporation must have the authority to pass resolutions in relation to the monthly amounts to be paid by each homeowner to cover the common expenses within the gated community;
  • The corporation must be subject to the presentation of annual financial statements;
  • The corporation must have the authority to commence and defend legal actions in court or before the central monitoring authority, especially in relation to the payment of monthly maintenance;
  • In the event that any homeowner defaults in the payment of maintenance for some stipulated period, the corporation must have authority, through some detailed procedure, to sell that homeowner’s property in order to settle the arrears.

It is hoped that this article will trigger an update on the progress that is being made towards enacting gated community legislation.

Sherry Ann McGregor is a partner, mediator and arbitrator in the firm of Nunes Scholefield DeLeon & Co. Please send questions and comments to lawsofeve@gmail.com.

Sherry Ann McGregor

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Sherry Ann McGregor

Sherry Ann McGregor is a partner, mediator, and arbitrator in the firm of Nunes Scholefield DeLeon & Co.

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