UNDERSTANDING THE IMPACT OF THE COMMONHOLD REGULATIONS COMPLIANCE UPGRADE OBLIGATION
Release date : 02/01/2020
Understanding the impact of the obligation of upgrading to compliance the commonhold regulations
According to article 6-4 of the ELAN law of November 23, 2018, “the existence of special commonly owned areas and those reserved for private use and enjoyment is subject to their explicit mention in the commonhold regulations.” Co-owners’ associations have a period of 3 years from the promulgation of the ELAN Law to upgrade their commonhold regulations to compliance - that is until November 24, 2021. But what are the consequences in the absence of a compliance upgrade?
For a co-owner who has obtained the right to private use and enjoyment of a commonly owned area
It is common, at general meetings, to grant rights to the use and enjoyment of commonly owned areas (a courtyard, a garden, a terrace, a parking space, etc.).
If the owner, who has obtained this right of use, does not have it listed before November 24, 2021, in the co-ownership regulations, this right will be non-existent. He will, therefore, be placed in a situation of illegality since he will be using property that is not listed as special commonly owned areas.
To illustrate this difficulty when selling a lot, for example, the notary will have to verify whether a co-owner has a right to use and enjoyment. Insofar as this right is not included in the commonhold regulations, the sale could be cancelled, or the sale price could be significantly reduced. The co-owner will, of course, be able to recover it following a new vote during the general meeting - by the reinforced majority of article 26 - if the co-owners accept it again and under what conditions?
For the co-owners of a special commonly owned area
The existence of a special commonly owned area must imperatively be combined with a specific schedule of expenses assigned to this co-owned area. There can be no special commonly owned areas without specific expenses.
If the special commonly owned area is officially recognised, only the co-owners of this special co-owned area will be entitled to vote on decisions concerning it. The other co-owners will be excluded from taking part in the votes relating to this special co-owned area.
Conversely, all co-owners will be invited to vote on decisions affecting only those special commonly owned area that will no longer have any real existence. All co-owners will participate in the common expenses which will remain general.
For the Co-owners’ Association
By upgrading the commonhold regulations to compliance, the co-owner(s) are not deprived of the rights they have been granted previously. This allows for a fairer distribution of expenses according to the use and usefulness of the commonly owned areas.
Should the co-owners’ association refuse to harmonise the commonhold regulations, it will expose itself to potential legal action taken by one or several co-owners who have been prejudiced, knowing that the provisions of the ELAN law have a peremptory character.
For the trustee
The property manager must propose that the commonhold regulations be upgraded to compliance, failing which he could be held liable by the Co-owners’ association and its members. There is a risk of contestation of the decisions voted on, challenges to the distribution of expenses, and difficulties in applying the commonhold regulations.
In the absence of an amendment to the commonhold regulations, the termination of a right of private use and enjoyment granted to a co-owner of a commonly owned area would have serious consequences.
Have you upgraded your commonhold regulations to compliance? No?
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