Condominium

Condominium is the name used for a set of apartments that make up a building, in case they belong to different owners. The respective owners are called Owners.

What are the expenses of a condominium?

It is very important to know how to qualify the expenses that are incurred with the common parts of the building, because only then can you know who is responsible for your payment.

  1. Usage (or fruition) expenses - These are all expenses that are related to the daily life of the building, with the costs that result from the use of common parts. This is the case with the payment of electricity, water and sanitation for the common parts of the building, minor repairs such as replacing lamps and glass, the purchase of cleaning articles, material necessary for the management of the condominium (receipts, books, correspondence).
  2. Payment of services of common interest - This type of expenses also has to do with the use of common parts, but in this case, instead of purchasing, we talk about the remuneration of people or companies that have service contracts with the building. This is the case of the insurance company, the gatekeeper, the gardener, the night watchman, the companies with contracts for the maintenance of mechanical installations, such as 16 elevators, water pumps, smoke hoods, garbage ducts and opening mechanisms. gates.
  3. Conservation Expenses - Conservation expenses are substantially different from those mentioned above. In this case, the necessary charges on a daily basis are no longer in question, but rather all those works and repairs that have to be done so that the building does not deteriorate. This includes cleaning and painting facades and other common parts, repairing downspouts, replacing pipes, replacing the elevator mechanism, etc. According to the Legal Regime for Urbanization and Building, conservation works must be carried out on the building every 8 years.
  4. Expenses with Innovations - Whenever new elements are added to the building that until then did not exist, we speak of Innovations .This is the case with the installation of a satellite dish, intercoms from the building's door to the floors, placement of access doors to the outside of the building to the stairwell, full replacement of facilities or equipment by imposing new construction regulations, etc.

Who pays for common parts?

If there is no provision to the contrary (for example, in the constitutive title of the horizontal property, in the condominium regulation or in a resolution of the assembly), the necessary expenses for the conservation and use of the common parts of the building and the payment of Services of Common Interest are supported by the joint owners in proportion to the value of their fractions, which is indicated in the constitutive title.

However, expenses related to the payment of Services of Common Interest , may - subject to the condominium regulation, approved without opposition by a majority representing 2/3 of the total value of the building - be borne by the tenants in equal parts or else , in proportion to the respective use of these services by each one, provided that the criteria that determined this choice are duly specified and justified. With regard to expenses related to elevators, flights of stairs or common parts that exclusively serve some tenants , only those who actually use these common parts should pay them.

In principle, only the owners themselves are responsible for the payment of the condominium, but it may happen that in a rented fraction the tenant will only pay the costs of use and Services of Common Interest , provided that it has been specified in the lease, as this possibility is authorized by the urban lease law itself.

As for the works of innovations in the building, even those who do not agree with this expense must pay their share, however, they can appeal to the Court and if the Judge decides that the work in question was not necessary and can be considered disproportionate in relation to the building itself, it will then grant the right to recover the payment made.

If this happens, the owner who does not pay the expenses cannot benefit from the innovation, unless, afterwards, he decides to take advantage of it and must for that purpose pay the quota corresponding to the costs of execution and maintenance of the work.

How to pay for the works in common parts?

The administration of the condominium, when carrying out works of ordinary and extraordinary conservation in the common parts of the building, may use the Common Reserve Fund to finance them.

What is the Reserve Fund?

The Common Reserve Fund is mandatory by law and consists of contributions from all tenants to help pay for the maintenance works that need to be carried out in the building. The assembly fixes the amount that each member has to give each month to this fund, which can never be less than 10% of its share in the current expenses of the condominium and must be deposited in a bank account.
The condominium's contribution to the Fund must be included in the payment of the condominium fee, for reasons of simplicity.

However, it is up to the administrator to take care to separate the amounts of the two funds in order to deposit them in two different accounts: what concerns the quota for the condominium's working fund must be deposited in an account for current use and the portion corresponding to deliveries to the Fund must be deposited in another account opened especially for that purpose.

What is the Condominium Savings Account?

The amount deposited in the Common Reserve Fund can be applied to a Savings-Condominium Account in the form of a term deposit with a minimum duration of 1 year, renewable, if the meeting so chooses.

The balance of this account can only be mobilized by the administrator or by any condominium authorized by the meeting, exclusively to assist in carrying out, in the common parts, works of extraordinary conservation and improvement, provided that the latter have been determined by the administrative authorities, and, first of all, it guarantees the granting of a loan to the condominium holder of the account for more than 3 years.

How to manage the money of the Condominium?

Condominium management must have at least two bank accounts:

  • A demand deposit account for the payment of the current expenses of use and common services, where the dues paid by the tenants and, possibly, other revenues that the condominium has must be deposited;
  • Another account for the Common Reserve Fund, preferably a term deposit in the form of a Savings-Condominium Account, intended to finance the maintenance costs of the building and, eventually, works with innovations that the assembly decides to finance through the Fund.

Who manages the condo?

The Joint Owners' Meeting, which is made up of all joint owners and the Administrator, who is appointed by the meeting, and who together form the management bodies of the condominium.

The Administrator can be a joint owner, or any person or company that does not own any floor, and has an essentially executive role. There should always be a sign with the administrator's identification at the entrance of the building or in another place visible to all the tenants.

It is up to the assembly to decide whether this position is remunerated or not and, if so, how much the administrator should receive. One of the ways to pay a fee to the administrator is to release him from paying the condominium fee, as long as, of course, the administrator is a joint owner.

The director is elected by the joint owners at the meeting, and his term of office is normally one year renewable, unless another term is decided, always remaining in office until his successor is elected. If the meeting does not elect a director, and if he has not been appointed by the court, the corresponding functions will be mandatorily performed by an Interim Director . If no tenant wants to hold the position, the one with the highest percentage or percentage of the total building value must be chosen. If there are several with the same values, as the fractions are indicated in the Land Register in alphabetical order, the one that corresponds to the first letter in the alphabetical order used in the description of the fractions in the property register must be chosen.

The administrator's functions are:

  • Call the joint-owners' meeting;
  • Prepare annual budgets for income and expenses;
  • Collect revenue and make common expenses;
  • Render accounts to the assembly;
  • Require from the tenants their share of the expenses approved by the meeting;
  • Provide two bank accounts for the condominium: one for checking accounts and one for the Common Reserve Fund;
  • Execute the deliberations of the assembly;
  • Carry out repairs to the building and other acts necessary for the conservation of common goods;
  • Regulate the use of common things and the provision of services of common interest;
  • Represent the condominium before the administrative authorities;
  • Represent the condominium in lawsuits;
  • Verify the existence of insurance against fire risk, or propose to the meeting the amount of capital to be insured;
  • Ensure the implementation of the regulation and legal provisionsand administrative costs related to the condominium;
  • Save and maintain all documents concerning the condominium;
  • To transmit to the tenants all the notifications that they may receive from the administrative authorities;
  • Give a copy of the condominium regulations to all people living in the building, even if they do not own the floors, as is the case with tenants;
  • To transmit to the non-resident owners all the relevant facts of the life of the condominium.

The owner who does not agree with an act of the administrator can call an extraordinary meeting to complain about that act.

Source: Condominium Guide

 
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