Becoming a co-owner is a significant decision that requires careful consideration. The risk of conflict among co-owners can increase significantly if any party fails to uphold their responsibilities.
To avoid potential disputes, it is crucial to thoroughly review all pertinent documents before buying a condo. One of the most vital documents in this process is the Declaration of Co-ownership. This document outlines essential details regarding the responsibilities of each co-owner and ensures that the property meets your expectations.
In this article, we will explore the key aspects of the declaration of co-ownership, including the information it contains, the responsibilities it outlines for co-owners, and the consequences of non-compliance. Once you’ve become familiar with this document, you’ll gain a clear understanding of your co-ownership responsibilities.
What is the purpose of The Declaration of Co-ownership?
The Declaration of Co-ownership is a notarized document that acts as a contract among the co-owners of a building. Published in the land registry, this notarized document establishes divided co-ownership and establishes the rules for managing and living in the property. Specifically, it details:
- The regulations for the operations and management of the building.
- The rights, responsibilities, and restrictions for residents.
All residents, property owners, and the co-ownership syndicate are required to follow the terms outlined in the declaration. Non-compliance with these requirements can result in various consequences, which may differ in severity based on the circumstances.
What information does this document contain?
As mandated by the Civil Code since 1994, a declaration of co-ownership is divided into three distinct sections:
- The constituting act of co-ownership
- The by-laws of the building
- The description of the fractions
1. The constituting act of co-ownership
The first section provides essential information for understanding co-ownership and includes:
- The purpose of the building, detailing whether it is residential, commercial, or mixed use, and specifying the private units and common areas.
- The allocation of voting rights at co-owners' meetings.
- The relative value of shares and the method for determining them.
- The allocation of expenses for the property.
- The distribution of powers and responsibilities between the condo board and the general meeting of co-owners, in accordance with the law.
- Decisions related to building insurance.
2. The by-laws of the building
This section outlines the rules that owners and occupants must follow daily. It primarily addresses:
- The conditions for using and maintaining both common and private areas.
- Regulations within private areas, such as restrictions on certain types of renovations, keeping pets, or using a barbecue on the balcony.
- Rule for appointing directors and conducting meetings for both the board of directors and the general meeting of unit owners.
3. The description of the fractions
The third section of the declaration of co-ownership identifies each private and common lot by its cadastral number. It also includes a description of any encumbrances affecting the building, such as easements.
How can I obtain a copy of the Declaration of Co-ownership?
Typically, the buyer receives the Declaration of Co-ownership from the seller during the purchase process. If the seller is unable to provide a copy, you can request one from the syndicate of co-owners, which keeps it in the co-ownership register.
Who enforces the Declaration of Co-ownership?
The rules outlined in the declaration of co-ownership must be respected by all building owners and tenants, as well as by the members of the syndicate, which represents the collective interests of the co-owners.
The condo board is responsible for ensuring that all members and co-owners adhere to these rules. In cases of non-compliance, the board can implement various measures to address and correct the issue.
What are the consequences of non-compliance?
If there is non-compliance with the co-ownership agreement, the board may take several actions based on the severity of the issue:
- Issue notices
- Request mediation or arbitration
- Prepare a formal notice through the syndicate's lawyer
- Impose penalties
- Take legal action if other measures are ineffective
Additionally, most declarations of co-ownership include a penalty clause for those who fail to comply. In severe cases, the managing agents may terminate a tenant's lease or seek an injunction from the court.
How can the Declaration of Co-ownership be modified?
Once established, the Declaration of Co-ownership can be modified by the co-owners. Changes are typically voted on during this meeting. Beforehand, co-owners receive a notice detailing the agenda and the draft of the proposed amendment.
The law provides different procedures depending on the type of modification being proposed.
1. Changes to the constituting act of co-ownership or description of fractions
When making changes to the constituting act of co-ownership or the description of fractions, the amendment must be formalized through a notarial deed and registered in the Land Register. The amendments should be recorded under the registration numbers for both the common areas and any directly affected private portions.
To amend the description of the fractions or the constitution act of co-ownership, a reinforced majority is required, meaning 75% of the votes must be in favour.
For changes specifically affecting the building's destination, a double majority is needed: 90% of the votes must approve the modification, and those approving must represent at least 75% of the co-owners.
2. Changes to the building by-laws
Changes to the building by-laws do not require notarization, but the syndicate must ensure that the amendments comply with applicable laws. The changes take effect once they are filed with the syndicate in the Register of Co-ownership.
The filing is considered complete as soon as the decision is explicitly recorded in the minutes of the general meeting of co-owners or in a written resolution signed by all eligible voters.
To be approved, modifications to the by-laws must receive an absolute majority, meaning more than 50% plus one vote.
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