- Legal hypothec : Legal hypothec
Definition : Legal hypothec
Security given by operation of law. There are 4 different types of legal hypothecs:
1. Legal hypothec of the state: For claims of the State for sums due under fiscal laws, as well as certain other claims of the State or of legal persons established in the public interest , specially provided for in specifics acts ;
2. Legal Hypothec of construction: For sums due to persons (architect, engineer, and supplier of material, worker, contractor or subcontractor) having taken part in the construction of a building or the renovation of an immovable;
3. Legal hypothec of the syndicate of co-owners: For the sums due by a co-owner in default of paying to the syndicate of co-owners his share of the common expenses or his contributions to the contingency fund for more than 30 days.
4. Legal hypothec resulting from a judgment: For sums due under a judgment .
The syndicate of co-owners must, to meet the expenses arising from the co-ownership and the operation of the immovable, collect from its members the necessary sums. It is therefore essential that the co-owners meet their financial obligations on an ad hoc basis. However, the failure to pay general or special common expenses (condo fees) is one of the most contentious co-ownership’s issues. The role of the board of directors in this matter is paramount, it is up to it to collect the debts of the syndicate. Unless this task is delegated to the condo manager. The syndicate must therefore take the necessary steps to collect the unpaid sums. A review of the options in such cases.
The additional premium is a premium that is added to the existing premium. It results from a worsening of the risk or from the assumption of a new risk. This additional premium may be imposed during the course of a contract or upon its renewal. Risks are analyzed according to scales that are specific to each insurer. Ultimately, the syndicate will pay this additional premium, which will be charged to all of the co-owners through the common expenses (condo fees) or, at times, some of them.
You move into your new condo. A few weeks later, a bailiff knocks on your door and serves upon you a notice of preservation of a legal hypothec of construction. He also served all your neighbors. Reading this document, you learn that a dispute remains unresolved between the contractor and a supplier (or subcontractor), concerning work performed or materials furnished that have not been paid by the contractor. Often, these problems are resolved through the developer. But sometimes, a co-owners must institute legal proceedings for the cancelation of a legal hypothec from his title.
9 avril 2019 — Les frais de condo en souffrance peuvent entraîner un imbroglio juridique duquel personne ne ressort gagnant. C’est ce qui est arrivé à un couple de copropriétaires qui, après avoir fait défaut de payer ses frais de condo, a dû faire face à la publication, par son syndicat de copropriétaires, d’une hypothèque légale contre l’unité qu’il a achetée en 2013. Il en a résulté un procès opposant les deux parties.
The notary is a jurist with the task of public officer, who ascertains the free and informed consent of the parties. The notary also has the role of legal adviser. It therefore protects consent. The intervention of the notary is very important when purchasing an apartment in a divided co-ownership. A professional, he is a member of the “Chambre des notaires du Québec” (Québec Chamber of Notaries). In this capacity, the notary's mission is to receive, on behalf of his clients, the acts to which the parties must or want to have given the character of authenticity (such as a declaration of co-ownership). Even though it is preferable that he should get involved at the outset of a transaction, this legal adviser usually gets involved after the signing of the offer to purchase or of the preliminary contract.
When you buy in a newly built divided co-ownership, a portion of the fractions of the building (apartment, parking or storage space, etc.), or even all, can be the subject of a notice of legal hypothec of construction. The Civil Code of Quebec introduced this hypothec in order to protect the persons who participated in its construction or renovation (architect, engineer, supplier of materials, workman, contractor or subcontractor) so that they can be reimbursed for work and services carried out on an immovable.
As a buyer, will you be required to pay the developer's debts if it defaults on its construction creditors? If so, will the amounts claimed be distributed among all co-owners? And what will happen if they refuse to pay?