Definition : Contingency fund - Contingency fund survey

The exercise intended to estimate, in the short, mid and long term, the cost of work to proceed to major repairs of the common portions or their replacement. This survey is intended to establish precisely the amounts to be paid by the co-owners, for their common expenses, for the purpose of collecting annually the amounts required to be able to carry out   such work.

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L'étude du fonds de prévoyance et le carnet d'entretien deviendront éventuellement obligatoires, en vertu de l'adoption du projet de loi 16, en décembre 2019. Les syndicats de copropriétaires pourront, ainsi, mieux planifier les travaux majeurs à faire dans leur immeuble, ainsi que le remplacement des parties communes.
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Le fonds de prévoyance est le "bas de laine" d'une copropriété. Il sera indispensable lorsque viendra le temps d'engager des travaux majeurs dans l'immeuble, ou qu'il faudra remplacer des parties communes arrivées à échéance.
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Le carnet d'entretien est indispensable pout tout syndicat de copropriétaires, afin d'assurer la pérennité de son patrimoine bâti.
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The Contingency Fund is to be used strictly for major repairs and replacements of common portions. It should not be used to fund their maintenance.
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  An indispensable co-ownership document, the maintenance and management logbook is in essence a register tracing the building history, as well as a register of all the operations already carried out or forthcoming thereon. Even though not mandatory, it increases a co-ownership’s resale market attractiveness. In addition, the directors, by availing themselves of such a logbook, demonstrate their concern for good governance and sound management.
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Le certificat d’état d’immeuble correspond à un « bilan » de l’immeuble : il constate la qualité du bâtiment, à un moment précis. Il comprend l’inventaire des composantes de l’immeuble (espaces extérieurs, bâtiments, logements, équipements, etc.) qui feront l’objet d’une évaluation pour les fins du fonds de prévoyance. Bien il n’y ait pas d’obligation légale à cet effet, ce document devrait être préparé par un technologue professionnel, ingénieur, architecte.
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Preparing a budget forecast is an unavoidable task in co ownership. Its preparation, preliminary examination and adoption will ensure the proper functioning of the syndicate of co-owners. It is up to the Board of Directors to define its terms, in view of the expenses that will have to be paid to allow a syndicate to meet its obligations. The budget also makes it possible to fix the amount of the contributions of each co-owner to the expenses of the co-ownership. It will be prepared by the Board of Directors or property manager, based on the amounts spent in preceding financial periods, as well as anticipated non-recurring expenses. The preparation of the budget forecast requires time and rigor.  
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The law provides that a syndicate must keep a register at the disposal of the co-owners. In most cases the declarations of co-ownership list the items it contains. This register is the memory of the syndicate, and consequently, its archives. In is thus invaluable. Much more than a mere witness of the sound management of an immovable, it is its prime instrument. Therefore, preservation and access are the hallmarks of this register.
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Co-ownership work is of the utmost importance. Yet, they are more often than not overlooked by the syndicates of co-owners. Work that needs to be done in common portions can be minor or major in scope. Yet one needs money to pay for them. Good financial planning is therefore advisable in the medium and long term, so that the community of co-owners can adequately protect its real estate investment. Replacing windows, the roof or rehabilitating the underground parking slabs, to name just a few examples, is usually very expensive. Three options are available to the syndicate to pay for this work:
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  December 14th 2015 - Besides seeing to the respect of the declaration of co-ownership, you as directors of a condominium must ensure the maintenance and conservation of the building. It is your uppermost duty and the majority of your tasks ensue from this fundamental obligation.
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Buying an apartment in a co-ownership is a major investment in a lifetime. To avoid being caught off guard during the process leading to your purchase, you should seek proper assistance.
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L’étude du fonds de prévoyance doit-elle être réévaluée régulièrement?
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The contingency fund survey provides an overall picture of the forthcoming strategy, toward foreseeable major work in a co-ownership. It consists essentially of estimates and forecasts based on the previously discussed parameters. The survey does not indicate the cost and precise content of the work. These forecasts will eventually be confirmed or reversed at the time the plans, specifications and tenders have been completed.
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The Contingency Fund study is an essential step in the sound management of an immovable held in co-ownership. You should be aware that the amounts paid into this fund are often insufficient, taking into account the amounts required for the necessary work to be carried out on the common portions of the immovable. At least four out of ten syndicates of co-owners state, based on surveys, that they do not have enough money to finance this work. This number increases considerably in immovable built before the year 2000. To alleviate this situation, syndicates caught unprepared use special assessments.
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I am a recent co-owner. The building I live in has 10 units. The contribution to contingency fund is substantial. In fact, it represents 20% of the budget of the co-ownership! That seems excessive. Question: Is there a ceiling to the amounts to be paid in the contingency fund   
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  With the adoption of the Civil Code of Québec in 1994, to fill a void in the Law, the Quebec legislature introduced the obligation upon a syndicate of co-owners to fund a "contingency fund”. Prior to the enactment of the Civil Code, it was a frequent occurrence for co-ownerships to have a "reserve fund", although the Civil Code of Lower Canada was mute on this issue. Most of the time, this fund was inadequate, due to the low level of contributions paid into it.
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