Definition : Meeting of co-owners - Special Transitional Meeting

The new provisions introduced by Bill 16 will bring about many changes regarding the contingency fund in a co-ownership. It will be mandatory to obtain a contingency fund study, which will establish the necessary amounts so that the fund is sufficient to cover the estimated cost of major repairs and replacement of the common elements (art. 1071 of the Civil Code of Quebec). The miminal content of this study and the professionals who will be able to carry it out will be determined in a future government regulation soon to be published. Such study will have to be obtained every five years by the board of directors, which will have to determine the amounts to be paid into this fund, according to the recommendations made in this study.

The developer, who often acts as a interim director as long as he holds the majority of the votes of a co-ownership, will eventually have to transfer power to the future board of directors. The latter will be elected at a special transitional meeting, which must be held when the same developer loses the majority of votes in the building. As soon as the co-ownership is born, that is to say when the declaration of co-ownership is published in  the Quebec Land Register, the Therrien Couture Joli-Coeur team offers to take charge of all the steps relating to the start of the syndicate and the complete organization of the  first meeting of co-owners during which the transitional administration is terminated. Our firm can, as part of this service provision, guide the transitional director and the co-owners through each step of the start-up of your syndicate of co-ownership, and give you all the necessary advice to ensure an effective start of the co-ownership.

Whether you are a real estate developer (for a new building) or several owners of an existing building who wish to convert it, the rules for subjecting a building to divided co-ownership are the same. The creation of a divided co-ownership is necessary when an immovable must be divided into lots composed of a private portion and a share  of the common portions, and which belong to one or more different persons. The community of co-owners acquires the status of legal person from the day a declaration of co-ownership is published at the Land registry office (Land Register). The legal person thus constituted takes the name of “syndicate of co-owners”. Its mission is to ensure 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 ". To form this co-ownership several steps involving many protagonists are necessary.

Every syndicate of co-owners has obligations regarding common portions maintenance. Article 1039 of the Civil Code of Québec provides that the object of the syndicate is the conservation of the immovable, the maintenance and the administration of the common portions. 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." This duty to preserve the immovable is exercised in particular by the setting up of a maintenance logbook. This document is a measurement tool on the apparent condition of the common portions and therefore on the common equipment of the building.

The meeting of co-owners is the gathering of all the co-owners, to make the decisions necessary for the sustainability of the building and the proper functioning of the co-ownership. It is one of the two decision-making bodies of the syndicate. This should be held at least once a year, but it can take place as often as necessary. You should be aware that co-ownership life implies that the co-owners or their representatives meet, occasionally, to discuss and vote upon important decisions. This must be done at meetings of co-owners, where the members of the syndicate can make their voice heard by exercising their right to vote. Their conduct obeys certain rules of form and substance. An overview of the various specific aspects of meetings of co-owners.  

The COVID-19 health crisis and its procession of government restrictions to limit gatherings have often made it impossible to regroup. The legislator was forced to organize the rescue of legal persons, banned from assemblies, to preserve, at least for a time, their functioning. The syndicates of co-owners have thus adopted alternatives to face-to-face meetings of co-owners. Social distancing obliges, COVID-19 has given rise to a phenomenon in co-ownership: virtual meetings of co-owners, also called remote meetings. In order to perpetuate this way of doing things, the law now authorizes syndicates of co-owners to hold meetings by technological means.

A General Meeting of the co-owners cannot take place without an agenda. To deliberate in accordance with the Law, co-owners should be able to become aware, before the General Meeting, of the questions on the agenda. This the reason why it should be annexed to the notice of call, usually prepared by the Board of Directors (Board). It contains all the questions to be tabled for deliberation during the General Meeting. This document must be clear and unambiguous to avoid legal challenges. An overview of the various specificities of the agenda.    

The presence of a Board of Directors is mandatory in a co-ownership. It is the executive body of the syndicate and its legal representative. Its members act as the mandataries of the syndicate. When a co-ownership is newly constituted, the declaration of co-ownership generally provides for the appointment of a interim director, who exercises the functions of the Board of Directors until the Meeting of co-owners appoints a new board of directors. This transitional period is generally delicate because of the necessarily numerous and complex problems relating to defects in workmanship, latent defects and construction defects. And this is not to mention that the transitional administrator set up by the developer may have a negative role: protect the developer and transfer to the co-ownership of charges incumbent in principle on the developer.  Its appointment Usually, it is the developer who designates him, in accordance with a provision in the declaration of co-ownership (By-laws of the Immovable). Often he appoints one of his  representatives to act as the interim director of the syndicate.

Expenses related to the maintenance and administration of the common portions of a co-ownerships start from its constitution as a legal person. It is therefore necessary that each co-ownership sets up, upon publication of the declaration of co-ownership, a Board of Directors to administer it. This board of directors is the executive body of the syndicate and its legal representative. Its members act as the mandataries of the syndicate. To ensure the star up of the syndicate, the developer usually designates in the declaration of co-ownership (by-laws of the immovable), one of its representatives to act as the interim director of the syndicate. His role is to accompany the co-owners, manage the co-ownership and see to the organization of the special transition meeting to elect the new directors to constitute the board of directors.

Co-owners must be called at least once a year to a meeting known as an annual meeting. This assembly, like all other types of assembly, must bring together all the co-owners. With the notice calling the meeting, the board of directors notifies all the co-owners of the list of points to be studied and decisions to be voted on at the meeting of co-owners. This document is the agenda of the assembly. The summons has to respect a procedural frame, otherwise the assembly of the co-owners could be irregular. That is why it is up to the one who takes the initaive to summon her to respect rules  

Whatever the type of building they have chosen, all co-owners, without exception, are called upon to participate in meetings of co-owners. Thus they can vote on the questions on the agenda, and take various decisions necessary for the sound operation of the co-ownership. The co-owners are called upon to meet periodically for questions dealing with current administration, maintenance and operation of the syndicate, and sometimes exceptionally for specific questions required by the circumstances. This factsheet is an overview of the various types of Meetings that may be held in a co-ownership.  

I am the co-owner of a new condo. Other owners and I have recently discovered cracks in the foundation of the building, as well as water infiltration in the garage. The promoter is mute, and we have not yet transferred the administration. Question: Should we refuse to elect our first Board of Directors, until the issues identified have been corrected? And should I sell immediately before other major problems arise?

As a result of the loss of control of the developer, we have just held the first meeting of co-owners to replace the director who had been appointed by the developer and elect a new board of directors.  However, this director has not reported on his administration since the publication of the declaration of co-ownership!  Even worse, we don't know what he did with the condo fees he collected. Question: What rights do we have against it?

Question: Can a co-owner call, on his own, a general meeting? If so, in what circumstances and following what procedure?