Communal Property Rules

Questions about living in properties with shared/common facilities
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Frannie
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Joined: 14 Mar 2008 11:50

Communal Property Rules

Post by Frannie » 19 Mar 2008 20:22

Hi

I am part of a Resident's Committee for a Complex and we have just found out that our service provider has not paid communal utility bills on the grounds that our Community has not paid fully for services provided (because some owners have not paid their fees). However all along we have been advised by the service provider that utility bills were part of the service provision and outstanding fees due from individual owners would be a debt against that owner not the Community.

On a separate note the service provider is also of the opinion that it can treat contingency funds in a similar way i.e off set them against under paid service charges?

Does anyone consider that the service provider is able to off set utility bills and/or contingency funds in this way? :shock:



Nigel Howarth
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Re: Communal Property Rules

Post by Nigel Howarth » 20 Mar 2008 12:15

Hi Frannie and welcome to the forum,

Louise (in the legal section) may be able to provide you with a more definitive answer, but to my way of thinking:

You, and presumably the other residents, have a written agreement with your service provider to undertake certain management and maintenance tasks on your behalf. If you have honoured your side of the agreement but the service provider hasn't honoured his, then he's in breach of contract.

Are they individuals' utility bills you're talking about - or are they the bills for running the lifts, swimming pools, lighting, and other communal facilities?

If they're individuals' utility bills that haven't been paid, and they are not included as part of the service agreement, it's up to the individuals concerned to settle them, not the community - and the community shouldn't be held accountable.

If the utility bills are for providing services to the communal facilities, I can see no reason why these can't be paid from the contingency fund.

You may find the 'Jointly Owned Buildings Law of 1993' useful reading. You can get it from the download area of my website at http://www.cyprus-property-buyers.com/r ... nloads.htm

(If people are not paying their Communal charges one thing your service provider could do, assuming you all have your Title Deeds, is to obtain a Court judgement against the owners in default. This will enable him to lodge what is know as a 'memo' against the properties for the outstanding debt. Although he may not get the money immediately, the debt will have to be settled before the property's or transferred).

Regards,


Nigel Howarth
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Frannie
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Joined: 14 Mar 2008 11:50

Re: Communal Property Rules

Post by Frannie » 20 Mar 2008 20:28

Hi Nigel
Thanks for your response.

I am not sure my first posting was particularly helpful.

Basically we have two issues.

The first is that because some of our owners have not paid their service charges, and as a result the service provider has not received full payment for services rendered,

(a) communal utility bills have not been paid;
(b) outstanding service fees have been off set against contingency funds.

We inherited a system (we are changing going forward) where the community does not have a collective agreement with the service provider. Instead each owner has their own agreement which is to pay fees in return for maintenance services. These services include payment by the service provider (covering the cost not just the act of payment) of communal utility bills. Fees paid by owners are therefore recorded against each owner's name.

Last year the service provider decided to collect contingency fees as well as basic service fees with the aim mof building up a contingency fund. People could pay up front for the whole year or pay by instalments.

The problem is where instalments are involved the servicve provider has not kept on top of fee collection and so at the end of the year some owners are in arrears. To ensure full payment for services rendered the service provider has off set contingency payments made earlier in the year against any outstanding fees not collected. This does not cover all the outstanding fees, however, because some owners have paid no fees.

As a result the community is losing out on these contingency payments and we have had to pay the utility bills to make sure our supply is not cut off.

I suspect that there is little we can do about this 'offsetting' provided there is no-cross subsidy between owners. But you may think otherwise? Do you think the service provider should allocate all contingency payments to the contingency fund regardless or only those where owners are not in arrears?

As far as the utility bills are concerned do you beleive these are still the service providers responsibility?

Happy to look at the documents you refer to but I am not sure they cover this sort of thing. We will probably need to take legal advice and if Louise reads this she may be able to help!

Ultimately our problem ostensibly comes from owners not paying their community fees (we don't have title deeds yet) but from what I have read there is very little communities can do about this except take legal action - which again costs money which most communities like us don't have. If everyone paid as they should then these problems would go away!

Frannie :|



Nigel Howarth
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Re: Communal Property Rules

Post by Nigel Howarth » 21 Mar 2008 20:20

Hi Frannie,

I'm afraid that there are many buyers who refuse to pay their communal charges - I have a friend who has a holiday apartment on the Eastern side of the island with similar problems.

Without recourse to the Court, I don't think there's very much you can do about the non-payers. And even if you were to get a Court decision in your favour, getting the money out of them could prove difficult - particularly if they're non-resident.

What I suggest you do is to get together with the other owners and form yourselves into a loose committee. Then work out how you'd like the service provider to proceed (given the lack of money) and put it to him.

It is a difficult situation and you would have more power if you could form yourselves into a legally recognised committee. But I think you need to have to be the registered owners of the property before this can happen. In the meantime, it's really up to your service provider to chase up the non-payers.

Regards,


Nigel Howarth
Independent information & advice for Cyprus property buyers
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Frannie
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Joined: 14 Mar 2008 11:50

Re: Communal Property Rules

Post by Frannie » 12 May 2008 14:55

Nigel

Two things

(a) I have had occasion to go back to your response and to look at the Jointly Owned Property Law 1993 that you so kindly referred me to. I don't think the link you provided works any more so do you have another or can you tell me where I can get this law on line?

(b) Do you have a reference in Cyprus law that states it is illegal to install extra water tanks/solar panels running off an exisiting water supply under the present water restrictions. We have an owner ( we are a communal block of flats) :roll: :roll: who has done this without seeking permission from neighbours or the Commitee. In both cases I do not think the law allows permission in any event. Am I right?


Many Thanks
Frannie



Nigel Howarth
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Re: Communal Property Rules

Post by Nigel Howarth » 12 May 2008 15:26

Hi Frannie,

Sorry about the link, I've been reorganising my website. You can find the Jointly Owned Property Law 1993 at: http://www.cyprus-property-buyers.com/r ... nloads.htm

I'm not sure if it's illegal to install extra water tanks, but there was an article in the Cyprus Mail on the 19th April that said: "WATER cuts in Nicosia may be increased and fines are being considered for those who install extra water tanks." (you can read the whole article at http://www.cyprus-mail.com/news/main.ph ... &archive=1 ) so maybe something's in the pipeline.

The owner should have sought permission before installing an extra water tank - it's part of the common area and its use should be controlled/managed by the Administration Committee.

Regards,


Nigel Howarth
Independent information & advice for Cyprus property buyers
Contact Nigel Howarth
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