General Agreement/Communal Fees

[emmafudge]

Hi Nigel
I hope you can help me understand better the difference between the General Agreement and the Communal Property Act.

We previously bought a property from Leptos off plan, and signed a general agreement on possession of the property. Since then we have had title deeds issued and we now have a management committee.

Are we as owners and our MC governed by the General Agreement issued by Leptos or should our MC be governed by the 1993 Immovable Property Act?
I am a little confused as to what we should be expecting from our MC legally in terms of accounts/budgets etc.

Many thanks
Emma

[Nigel Howarth]

Hi emmafudge and welcome to the forum.

You can find the 1993 law concerning Buildings Under Joint Ownership by clicking here.

According to the law, all jointly-owned buildings (i.e. buildings consisting of five or more units) are required to have a Management Committee. This committee has responsibility for managing all relevant affairs, such as insurance, maintenance repair, restoration and management of the building.

The owners of the units contribute towards the annual costs of the insurance, etc.

As for the accounts and budgets, these should include the annual costs of insurance, etc. But it is also advisable to set up a separate 'sinking fund' to collect money to pay for unscheduled maintenance and repair of equipment that is not part of the planned annual maintenance activity.

But without looking at your General Agreement, I can't say what (if any) obligations it places on you and the other owners on the development or whether it conflicts with the 1993 law (which is currently being revised.)

I'll send you an email - just reply to it with a copy of your General Agreement.

Regards,

[Nigel Howarth]

Hi Emma

Thanks for your email and the General Agreement, which is identical to the 1993 law, but with the addition of article 10, 11 and 12.

As you have your Title Deeds, Articles 12.1.1, 12.1.2, 12.1.3 and 12.1.4 no longer apply in my opinion as the building has been registered with the Lands Office and the 'transitional period' has lapsed.

10.1 states "In parallel to the election of the Management Committee the general meeting may proceed with the appointment of a person or legal entity to act as a Manager for a fee, for any period of time from one to five years...".

'may' indicates that it's optional - there is no need to appoint a 'manager'.

So you no longer have to pay the vendor 6 cents per square metre and your Management Committee can take complete control of the insurance, maintenance, repairs etc. of the jointly-owned building

I hope that helps.

Regards,

[emmafudge]

Hi Nigel

Thanks for your detailed response.

Yes it helps immensely.

Thank you