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A GUIDE ABOUT THE RECENTLY REFORMED ( 2013) HORIZONTAL PROPERTY ACT
The recently reformed Horizontal Property Act, regulates a special kind of property by flats or premises which is the most common one in our towns. The LPH (Ley de Propiedad Horizontal) shall also apply to subcommunities and urban conservation entities where so provided in its statutes. According to this co-ownership system, every owner has on one hand the individual and exclusive property right over his/her dwelling or premise and also, the co-ownership, together with the rest of the owners, over the common elements of the building (stairs, patios, yards, entrances, elevators, structural elements, power supplies installations, etc). Every apartment or premise has a quota or share of ownership (cuota de participaci贸n) of the total value of the building, which is the scale to determine the percentage on the community expenses to be paid by each owner.
From www.brocoli.es
When you buy an apartment under this Law, you buy both an apartment and a quota or share of ownership over the common elements. When you are buying a house, you should consult the constitutive
title of the horizontal property in the Land Registry. It is a document which describes the building as a general unit and every flat or premise individually, with indication of surface, floor and annexes such as parking garages, attics or storage rooms. The proportional share of every flat or premise is fixed having as the calculation base, the net usable area of every flat or premise in relation to the whole building, its interior and exterior location, situation, and the kind of use of common elements that the owner is supposed to be doing in the future.
From ww.mantenimientojardinesmadrid.net
This title also has certain regulations of the building use, its flats and premises, installations and services, expenses, administration, maintenance and repairs, which constitute the Statutes of the Community of Owners. Every new owner will be bound automatically by the Statutes and the decisions taken at previous meetings.
It is very important to know that these statutes can be modified just by unanimous consent of all the owners. Therefore, for instance, if the statutes prohibit the use the apartments as offices (open to public), if there is a neighbor who wants to open a practice there, he will have to get the unanimous consent of all the neighbours in a meeting. If you are purchasing in a new development the rules of the Community must be explained to you and approved on your behalf.
The internal rules of the community Together with the Statutes, the owners can establish certain rules for the regulation of their life together and the adequate use of services and common issues. These rules are binding, although, just simple majority of votes is required for its modification.
What building works are allowed? Every owner can just do building works in his flat or premise, modifying its architectural elements, installations and services, provided: o
The safety of the building, its general framework and its outer configuration and condition is not altered.
o
None of the other owners’ rights is damaged.
o
Those building works are previously communicated to the Community.
o
Owners can do no alterations in the rest of the building. If urgent repairs are needed, it will have to be communicated to the administrator.
They are mandatory and do not require the authorization of owners, those arrangement works imposed by the Administration or requested by the owners in the following cases: -Maintenance, conservation and those necessary to meet basic safety, habitability, accessibility requirements as well as conditions of ornament. -Works related to general conservation obligation when they are being imposed by the Administration. -Necessary works to ensure reasonable accessibility and, in any case, those works required by owners or users with disabilities or owners who are older than seventy years, in order to assure the proper use of the common elements and the installation of ramps, elevators or mechanical and electronic devices that favor the communication with the outside provided that the cost does not exceed twelve months of community fees. As a novelty, these works can be requested either by homeowners or local owners. There is no further reference to economic family unit. -No prior agreement of community of owners is also necessary for material division acts, acts of aggregation, construction of new plants and otherwise altering the structure or fabric of the building or common things as well as the establishment of a real estate complex if they are made as a result of the Property being included in the scope of an urban rehabilitation, regeneration or renewal project.
Payment of the works: the costs of the necessary repairs shall be borne by all owners who will just decide on amounts to be paid and payment schedule. b) Require administrative any case:
approval, in
-Creation or modification of the building complex of art. 17.6 of Land Act. -Material division, aggregation, new plant construction, substantial alterations (enclosure and surround) if there is an agreement of the 3/5 of all owners and share holders. Both setting new quotas and the nature of the works in case of discrepancy require agreement of 3/5 of all owners and share holders.
Which are the forbidden activities? Owners and users of apartments or premises cannot perform in their properties or in the rest of the building, those activities which are forbidden in the statutes, those which are damaging for the building or are against the General Rules on annoying, unhealthy, harmful, dangerous or illicit activities. The President of the Community of Owners either by own initiative or by the initiative of any of the owners or users, must request to whoever may do any of the before mentioned prohibited activities to immediately stop, or inform that person about the legal actions against him/her that might be started if the behaviour is not stopped. If the offender persist doing it, the President, once authorized by the committee of owners, can take it into Court. In order to do that, the Community needs to use a lawyer, a Procurator is not necessary (although very recommendable). Once the lawsuit is in the Courts with the attached document on the solicitation made to the offender, together with the agreement taken by the board of owners, the Judge can pass a provisional decision on the immediate cessation of the prohibited activity and pass any other precautionary measure. After the necessary judicial procedure, the Judge will pass judgment
in order to pass any or all the following measures: o
The offender to stop the forbidden activity once and for all.
o
The offender to compensate the Community for the produced damages.
o
The offender to be deprived of the right to use the house or premise for a period no longer than three years.
o
A lawyer can provide legal advice on these issues according to the specific particulars of every case.
Joint and division of apartments and/or premises Apartments and premises can be divided and/or joined together, either totally or partially. For those cases, the unanimous consent of the Community of Owners is required, and new shares need to be calculated for the refurbished flats.
The most important obligations of the owner are, inter alia, the following ones: o
To respect the general installations of the Community and other communal elements, both of individual and of general use, included or not in his apartment, making an adequate use of them and trying to avoid by all means to make any kind of damages on them.
o
To keep his apartment in a good state of conservation, so that it won´t damage the community or other owners, compensating for the damages arose from his negligence or the negligence of those people who are under his responsibility. To allow in his own apartment all the repairs which are needed for the servicing of the building and allow the essentials (access, lights, o
waters) which are indispensable for the creation of shared services of public interest (i.e. lifts, reception, guards, etc.) holding all the rights to be compensated by the Community for the damages caused. o
To allow the entrance of workmen into his apartment or premise for repairs, as stated in the previous point.
o
To contribute, according to his share, to the general expenses for the adequate maintenance of the building, its services, charges and responsibilities.
o
It is very important to comment that the purchaser of a flat is responsible, and that the purchased house is the guarantee, of the payment of all the fees owed to the Community for maintenance of shared services during the purchase year and the year before. When signing the deeds, the seller must be updated with the Community payments and it needs to be formally expressed (the balance with the Community of owners)
To do so, the seller will ask the Secretary of the Community of owners to verify the state of his debts. This certification is obligatory for the signing of the deeds, without that document, the deed can not be executed (unless the buyer expressly releases the seller from that obligation) o
To contribute, according to the share, for the rising of the reserve fund which is obligatory in the Community of Owners in order to face conservation and reparation works.
o
The reserve fund must have at least the 5% of the last ordinary budget of the community.
o
The community can hire an insurance on the reserve funds in order to cover possible damages or to contract the general maintenance of the building and its general installations.
o
To act with due diligence when using the building and when relating to the rest of the owners, being responsible before them of every infringement and damage.
o
To communicate to the secretary of the Community, the mail address in Spain for notifications regarding the Community.
o
If there is no notice of this mail address, it will be legally enough just the notification made to the apartment or premise and handed to whoever is using it at that moment.
If an attempt is made in order to notify the owner about anything regarding the community and it becomes impossible to make it in the above referred place, this notification will be considered as fully and legally made by the posting of the communication in the bulletin board of the Community or at any visible place of Community use, formally expressing the date and reasons why this way of notification is used, signed by the Secretary and with the approval of the president. Notification made this way produces same effects as the notice made in person. o
Every change of ownership title over the house/premise needs to be communicated to the secretary of the Community, by any mean which gives evidence of the receiving. Therefore if you don´t communicate the sale of your property to the Secretary or you don´t do it in a clear way, you will keep being liable of the debts of the Community arose after the sale.(even though you can always claim the buyer back of the amount that was paid by you).
Obligations of the Community of Owners Every property has an easement to allow access to his property not only for the creation of common services of general interest but also for the execution of works and activities according to this Act. Purchaser of a home or building in horizontal property regime, even with title registered in the Land Registry, is liable before Community of owners, as the bought property is attached to that liability, for community quotas of the year of acquisition and those of the three previous years. The reserve fund may be used not only to maintenance and repair works but now also to rehabilitation.
The Community of Owners (CO) is obliged to make all the required building works for the due maintenance and conservation of the building and its services, so it will keep the required structural, tightness, habitability and safety conditions. On the other hand, those owners who oppose or delay the execution of the Authority requirements, will be individually responsible of the sanctions that may be imposed by the Administration. Therefore, for instance, if the building is about to fall down and the Town Hall
requires the repairs to the building, if there is a reticent neighbour and this makes the Community not obey, this neighbour will be liable, individually, of the sanction that may be imposed by the Town Hall. The improvements in the building Improvements or damages of every unit will not alter the community quota/fee, which can only be varied in accordance with the provisions of Articles 10 and 17 of this Act. Each owner can freely transfer his rights with no division of comprising elements and without affecting obligations attached to this particular property regime. No owner can demand new installations, services or improvements in the building which are not necessary for the needed conservation, habitability and safety of the building (i.e.- To change the front door of the building entrance for a more fashionable one… etc.) If community decisions for the installation of unnecessary things are reached and the installment to pay them is over 3 ordinary monthly installments for common expenses, that neighbour who doesn´t agree with them, is not obliged to pay them, and his/her community monthly installment cannot be increased or changed, even when it is impossible to deprive him/her of the improvement made by the Community. If the deprivation is possible and later on the dissident neighbour wants to take advantage of the improvements, he will have to pay his installment on the expenses related to the installation and maintenance, duly updated, applying the corresponding legal interest. Innovations which turn useless any part of the building for any neighbour will always require the express consent of this specific owner. ATTENDANCE TO THE GENERAL MEETING. Attendance to the general meeting can be made in person or by a solicitor or a lawyer. You can also grant power of attorney to someone else, just by signing an authorization. If any apartment or premise belongs undivided (“pro indiviso”) (jointly) to different owners, they should name a person to represent them and vote at the meeting. The owners who are not up-to-date with payments to the Community when this starts, (and they have not opposed those debts or have not made a judicial or notary deposit of the due amount), are allowed to deliberate but will not have the right to vote.
The minutes of the meeting need to mention those private owners who have been deprived of their right to vote, their votes will not be taken into account to reach the necessary majority for agreements.
THE MEETINGS The General Meeting of owners must be held at least once a year in order to approve the budget and accounts and also in every occasion when the president considers it as suitable, or when it is requested by a quarter of the owners or by a number of them which , at least, represents 25 % of the community. The announcement of the general meeting must be made by the President and, in his absence, by the promoters of the meeting, by making a list of the subjects to be discussed and by choosing date and time to be held in first and in second call.
From www.elmundo.es
The announcement must contain a list of the owners who are not upto-date with payments to the Community and a warning of their deprivation of the right to vote.
Any owner can ask the General Meeting to study or discuss on any subject of interest to the Community; to do so, it must present a document, identifying those subjects considered of general interest to the President, who must include them in the order of the day of the following meeting to be celebrated. If the quorum is not reached at first call, those owners who represent, in their turn, the majority of the shares can make a second call, which will be held without any quorum. The General Meeting must be held in second call in the place, date and time which was mentioned in first citation, and it can be held just half an hour after the failed first call. Generally, both calls are included in the same citation. The citation for the annual General Meeting must be done at least 6 days in advance and, in case of extraordinary meetings, the sooner for all the interested parties to know about it.
The General Meeting can be held even without the call of the President, if the owners decide it. THE VOTES The agreements of the General Meeting are submitted to, inter alia, the following rules:
1/3 OF ALL OF OWNERS AND SHARES -Installation of telecommunications infrastructure or adapting of existing ones. -Installing common or private systems of renewable energy. -Installing energy-supply infrastructure groups. MAJORITY OF ALL OWNERS AND SHARES (50% +1) -Works or service establishment in order to abolish architectural barriers where the amount exceeds twelve months of community fees and, in any case, the establishment of the lift. Once the agreement is made, all owners will be obliged to pay the related expenses even if these exceed the amount of the twelve monthly installments.
3/5 OF ALL OWNERS AND SHARES -Establishment or abolition of concierge services, concierge, security and other common services of general interest. The lease of common elements that are not assigned to a specific use in the building. -The establishment or removal of equipments and systems that are designed to improve energy or water efficiency of the property (other than collective systems for the use of solar energy or other collective energy supplies). -The material division, aggregation, new plant substantial alterations (enclosure and surround).
construction,
-Improvement Works. UNANIMOUSLY For those agreements which are not expressly regulated in art. 17 involving the adoption or amendment of the rules contained in Title or statutes.
SIMPLE MAJORITY For the rest of the agreements.
VOTES OF ABSENT OWNERS Except in those cases where you cannot pass on the cost of a service to those owners who did not vote in favor of the agreement at the meeting or in cases in which the modification or utilization is of individual use, general rule is that the owners not attending the meeting who do not express their disagreement to the resolution adopted within 30 days of notification of the agreement, will have their vote counted as in favor of the adopted resolution. The vote of those absent owners to a General Meeting, once they have been duly cited and informed by those owners who are present, and have not disagreed in writing to the Secretary within a period of 30 days from the date the decisions have been communicated to them by the rest of the owners, will be considered as favourable to the agreement. The agreements adopted in valid form are obligatory to all the owners.
The Community will be able to not charge the costs of the installation or adaptation of those common substructures, not even for maintenance, on those owners who have not expressly voted in favour of that agreement. Nevertheless, if they later require the access to telecommunication From www.eldiariomontanes.es services or to energy supplies, and this implies for them to make use of the new substructure or the adaptation made, they can be authorized always they pay the amount that had duly corresponded to them, by the application of the correspondent legal interest. It is just necessary the vote of the majority of the owners who also represent the majority of the shares for the validity for any other sort of agreement.
At the second call, those agreements adopted by the majority of the present owners, are valid if they also represent, more than the half of the present shares. When the majority can not be reached by the procedures established in the previous paragraph, it can pass to the Judge of First Instance to decide regarding that. CAN THE AGREEMENTS OF THE GENERAL MEETING BE OPPOSED? Agreements of the General Meeting can be judicially opposed in the following cases:
o
When they are against Law or Statutes of the Community of owners.
o
When they seriously damage the interests of the Community or one or some of the owners.
o
When they suppose a serious damage to any owner who is not obliged to bear it or they have been adopted with abuse of process.
Only those owners who had negatively voted in the General Meeting, those who were absent for any reason and those who had been improperly removed of their right to vote, can judicially oppose the agreements. The owner must be updated on their payments to the Community or to firstly deposit in the Courts any due amount.. The deadline to oppose these agreements is within 3 months after the agreement was made by the owners´ meeting, except for those agreements that infringe either Law or Statutes of the Community of Owners, in these cases the deadline for opposition is one year. It could be convenient to ask a lawyer about the convenient legal action.
The Minutes of General Meeting of Owners
The agreements of the general Meeting of owners must be written on an official Book of Minutes, this book is approved by the Land Registry where the building is registered.
The minutes of each meeting must contain: o
The date and place of the meeting location.
o
The promoters of the location
o
Mentions to the ordinary or extraordinary character of the meeting and if first or second call.
o
A list of all the assistants, their respective shares and the owners who are being represented by others, with indication of their shares.
o
The Agenda.
o
The agreements adopted, indication, in case that it was relevant for the validity of the agreement, of the owners´ names who voted in favour or against those agreements, and their shares.
The minutes must be finished with the signatures of the President and the Secretary that same day or within the following ten natural days. The minutes of the meetings must be sent to all the owners at the address designed by them, if the address is unknown, they will be sent to the apartment which belongs to the Community or in the notice-board. Any errors in the minutes can be corrected if expresses unmistakably the date and location, the present owners, in person or by representation, and the agreements met, with the indication of the votes in favour or against. The correction must be made before the following General meeting of the owners, that must ratify the corrected version. The Secretary must keep the books of minutes of the Meeting of owners. Likewise he must keep, during a period of time of 5 years, the calls, communications, powers of representations and the rest of the important documents of the meetings.
The President He/ she is elected amongst all the owners, by election or, if there were no candidates, by turn. The designation is binding. If the designated owner does not want to become the President, he needs to ask the Judge to release him from that responsibility, giving to the Court enough arguments for the exemption. The Judge will designate, by a simple procedure, the owner who must replace him/ her until new election. The Community of owners can also invoke the Judicial assistance if, for any reason, it is impossible to name a president at the General Meeting. The President holds the legal representation of the Community, either before the Courts or in out of Courts managements, at every subject related to the Community. The appointment of vice-presidents is not obligatory, in case the Community would choose to do so; this designation is made by the same procedure as the Presidents’. The vice-president is in charge of policing for the President when during leave, absence, vacancy, etc‌ He also has to assist him in his duties as President according to the rules of the Community of owners.
The Secretary
The functions of the Secretary and the Administrator are carried out by the President of the Community, except when either the Statutes or the Meeting of Owners, by majority agreement, agree on the appointment of specific people for these positions. Secretary or Administrator’s duties can be performed by either same or different person. These positions can be performed by an owner or by an agent. These positions can be replaced before the end of the deadline if that is agreed by the General Meeting of owners, called in extraordinary session.
The Administrator
The duties of the Administrator are as follows: o
Watch over the good management of the building, its installations and services, for those purposes he is entitled to do the necessary warnings and notices to all the owners.
o
To prepare in advance and to submit to the General Meeting the budget of foreseeable spending, and to propose the necessary means to confront them.
o
To watch out for the conservation and maintenance of the building, deciding on the urgent repairs and the means to make them, and communicating them immediately to the President or to the owners.
o
To execute those agreements adopted regarding works and to pay for them.
o
To operate, in cases, as the Secretary of the Meeting and to keep the documentation of the Community.
Owners in payment default Owners of flats are obliged to the payment of the corresponding fees on time and according to the way that had been determined by the Meeting of owners. If payments are not met by any/some owners, the President or the Administrator, if the General Meeting decided so, can claim the debt in legal way by presenting a lawsuit before the Court . Lawyer and Procurator are not legally required for this kind of lawsuits. Nevertheless, it is advisable to use these legal professionals, and, due to the complexity of the matter, it is almost essential to be assisted by one of these professionals, especially bearing in mind that, once the judicial proceedings are finished, the costs of their fees can be reverberated in the opposite part (it is called the “condemnation in expenses�). The use of that proceeding needs the previous certification of the agreement of the Meeting, approving the liquidation of the debt with the Community of owners by the Secretary, with the good approval of the President, and it also requires that this agreement has been correctly notified to the affected owners. Once the demand is presented and registered in a Court, the Judge will require the defendant to either pay to the plaintiff
Community, in a period of 20 days time, by depositing it in Courts, or to appear in Court and argue their positions, by an opposition writing, stating the reasons for not paying the whole or part of the required amounts. If the defendant does not appear in Courts or he does not oppose the lawsuit, the Judge will order the execution of all his goods with the possibility of being seized and sold by public auction for the recovery of the debt, plus interests, judicial expenses and notary expenses involved. Even though the defendant owner presented an opposition writing against the Community’s lawsuit, the Owners can ask for a preventive seize of goods which is estimated as enough to cover the claimed amounts, plus interests and costs. Once the judicial proceeding is over, the Judge will impose the costs to the party who’s allegations have been totally rejected. The condemnation to pay costs will contain the lawyer’s fees and Procurator of Tribunal’s fees of the lawyer and procurator of the winner part. It is always convenient to have the advice of a lawyer who, once he knows the specifics of every case, will be able to advise about the convenience of starting legal actions.
Can the Horizontal Property Act be applied to developments? The Horizontal Property Act can be applied to developments that join the following requirements:
o
To be integrated for 2 or more buildings or plots which are independent of each other, composed of apartments or premises.
o
The owners of the apartments and premises which are “horizontally divided” have inherent co-property rights on the common elements of the building.
The development owners can decide: o
To be set up as an individual Community of Owners.
o
To be set up as a “Communities of Owners Association”. In this case, they will be submitted to the regulations of the Horizontal Property Act, with the following particularities:
The Constitutive title of the new grouped Community must be conferred by the unique owner of the complex or by the presidents of all the communities that will integrate it, previously authorized by a majority agreement of their respective meeting of owners. The Meeting of owners is composed, except for opposite agreement, by the Presidents of the communities integrated in the group, who will be the representatives of their correspondent community at every Associations meeting. The adoption of agreements for which specific majorities are required, need to have in any case, the previous obtaining of that specific majority in every one of the associated Communities. A reserved fund is not required for the Association. The governing body of the Association only can decide about the elements of the building, lines, installations and common services. Its agreements can not limit the faculties that corresponded to the governing body (General Meeting, President, Secretary, etc.) of the communities of owners integrated in the association of the communities.
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