In compliance with its legal obligations to preserve the building, a syndicate of co-owners is frequently called upon to retain the services of contractors over the years to carry out, among other things, conversion work in the common portions. In this regard, the directors forming the board of directors of the syndicate have the obligation to act with prudence, honesty and loyalty and in the interest of the community of co-owners, in accordance with Article 322 of the Civil Code of Québec, when awarding a construction contract to one or more contractors.
With this in mind, can directors contract with a contractor who offers the syndicate a competitive price in return for a cash payment "under the table", i.e., without paying or remitting the taxes usually payable?
Every syndicate of co-owners has obligations regarding common portions maintenance. Article 1039 of the Civil Code of Québec provides that "Upon the publication of the declaration of co-ownership, the co-owners as a body constitute a legal person, the objects of which are the preservation of the immovable, the maintenance and administration of the common portions, the protection of the rights appurtenant to the immovable or the co-ownership, as well as all business in the common interest”.
However, this section was amended following the adoption of Bill 16. At the end of the first paragraph, referring to the syndicate of co-ownership, it reads the following sentence: "The legal person must, in particular, see to it that the work necessary for the preservation and maintenance of the immovable is carried out."
In the event that the latter fails to maintain and preserve the immovable, the syndicate may incur civil liability. This means that it is bound to have the necessary work carried out to prevent deterioration of the common portions of the immovable. The declaration of co-ownership and other legal provisions impose this obligation.
Over time, there is several maintenance or improvement work that require the Syndicate to access Private Portions, and even sometimes, work to be executed inside Private Portions.
In order that such crucial work for the Syndicate of co-owners not be obstructed, Article 1066 of the Civil Code of Québec provides that no co-owner may interfere with the carrying-out, even inside its private portion, of work required for the preservation of the immovable, decided upon by the Syndicate or urgent work.
This obligation to allow said work is opposable not only to co-owners but also to occupants and tenants.
Work to be carried in common portions is to be undertaken by the syndicate of co-owners. In its capacity of the client, he is the instigator and the beneficiary thereof. It prepares the specifications and consequently the needs, the budget, the provisional calendar and the objectives to be achieved. In relation to such work, the syndicate should always be governed by its mission. It should never act as a substitute for the general contractor, such as mandating the subcontractors directly to do the work, or by interfering in the conduct of the construction site, in the place and stead of the people responsible therefor.