Severe loss which may have dire consequences upon the syndicate of co-owners. In such circumstances, the insurance indemnity is paid to an insurance trustee. Criteria to establish what constitutes a "substantial loss" may be introduced by regulation of the Quebec Government.
Gérer un sinistre ne se résume pas à appeler son assureur et attendre la suite des choses. En cas de sinistre, seriez-vous prêt à y faire face?
After being victims of a loss, the members of the board of directors and the affected co-owners are often caught off guard. How will things unfold? There is no need to worry or panic, because in principle, once the notice of loss completed, various stakeholders get involved: the insurer of the syndicate, but also that of co-owners and lessees, who will respectively designate their own claim adjuster. Generally the co-owners affected by a loss, as well as the syndicate, believe that making a claim is always the right thing to do. This is true in many cases, but sometimes the syndicate might want to refrain from doing so.
If your co-ownership suffers a "substantial loss" as a result of an incident, you must use the services of an insurance trustee in accordance with article 1075 of the Civil Code of Québec. This section stipulates that "the indemnity owing to the syndicate following a substantial loss is, notwithstanding article 2494, paid to the trustee appointed in the Constituting Act of the co-ownership or, when none has been appointed, designated by the syndicate".
The insurance trustee is a key person. His role is to manage the indemnities paid by the insurer. It ensures that the money available is in fact used to "repair or rebuild the immovable". All in all, the interest of the co-owners and their hypothecary creditors is protected. Indeed, it is in their best interest that the immovable is repaired or even rebuilt.
Divided co-ownership is a housing formula that usually has more than one owner. In order to assess and quantify the interest of each person in the building, the legislator has provided that the right of ownership of each owner in the common portions is proportional to the relative value of his fraction. To determine the relative value of a unit, it must be compared with the value of all the other units of the co-ownership. The relative value is calculated and usually expressed as a percentage or thousandths. Its distribution is recorded in the declaration of co-ownership, (the constituting act of the co-ownership). Finally, it should be noted that the relative value determines the voting power in the meeting of co-owners and serves in particular as a basis for calculation in the distribution of the co-owners of the common expenses.