Updating declarations of co-ownership

The interpretation of a declaration of co-ownership during a general meeting of the co-owners is sometimes problematic. If, moreover, it has been published before the coming into force of the Civil Code of Québec, in 1994, things can get dicey.

In order to avoid potential conflicts between co-owners, caused by  an outdated declaration of co-ownership, it is essential to have it rewritten, if it has been published before January 1, 1994. A professional with experience in co-ownership law is qualified to do so. It is better to invest in rewriting your declaration of co-ownership, rather than getting tangled in costly litigation, the result of which is sometime uncertain.

 

What is the applicable rule?

Prior to January 1, 1994, the Civil Code of Lower Canada defined the rules for the establishment, organization and operation of divided co-ownerships. It has since been replaced by the Civil Code of Québec. The Act respecting the implementation of the reform of the Civil Code deals with the transition from the former to the new legislation. In this regard, article 53 of the said Act provides that the divided co-ownership of an immovable created before January 1, 1994 is governed by the new legislation. However, this rule provides for two exceptions. Is thus kept in application the provision of the declaration of co-ownership which stipulates that:

  • To change the destination of the immovable, a unanimous vote must be obtained;
  • The contribution to common expenses is based on the measurements of each unit.

What are the changes?

In many respects, the new legislation reformed the provisions of the Civil Code of Lower Canada, more particularly in relation to insurance.

  • The syndicate is required  to take out insurance against  ordinary risks covering the whole  immovable, namely common and private portions , with the exception of improvements made by a co-owner to his portion;
  • The general meeting of the co-owners no longer has to approve the rebuilding of the building after a loss, because article 1075 of the Civil Code of Québec prescribes that "the indemnity owing    to the syndicate   following a substantial loss shall be used to repair or rebuild, unless the syndicate decides to terminate the co-ownership ".

Concerning the contribution to the contingency fund, no "ceiling" can be enacted, even though several declarations of co-ownership prior to the reform of the Civil Code of Quebec provided such provision.

As for the majorities required at the general  meeting of the co-owners, the article 1108 of the Civil Code of Québec requires a double majority vote to end the co-ownership, i.e. three-quarters of the co-owners representing 90% of the votes of all co-owners . However, several declarations of co-ownership published before 1 January 1994 required a unanimous vote on this issue.

Why should you update?

Changes to the Law have the effect of invalidating in whole or in part certain provisions in the declarations of co-ownership. One example is a judgment rendered by the small claims division of the Court of Québec. The Court made a wake-up call to a Board of Directors that did not see the need to update its declaration of co-ownership which resulted in the judge declaring invalid some of its provisions. He also condemned the syndicate to:

  • Reimburse the overcharges collected (the case dealt with common expenses);
  • Display the judgment in a location accessible to all co-owners;
  • Make a report of the judgment at the next annual general meeting of the co-owners.

 

  WHAT YOU SHOULD KNOW ! A declaration of co-ownership evolves. Even if it complies with the Civil Code of Quebec, it may be necessary to update it, due to new requirements expressed by the co-owners or the Board of Directors. This review may only be carried out with the consent of the general meeting of the co-owners.

  WHAT TO KEEP IN MIND: "Better be safe than sorry" states the old saying. In other words, it is much easier and less costly to update your declaration of co-ownership, than be exposed to fierce   clashes with other co-owners or members of the Board.

   WARNING ! To update or rewrite a declaration of co-ownership, it is strongly recommended to use a seasoned professional in this field of expertise. This being said, we invite you to consult the section of the site: the provision of updating the declaration.

 

 

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