The Horizontal Property Act

 

Section 1 The statutory definition

 

This Act purports to regulate the special type of property ownership laid down in section 396 of the Civil Code, known as horizontal property. For the purposes of this Act any part of a building that can be subject to independent use by reason of an entrance from either to the public thoroughfare or a common part shall be considered as premises.

 

Section 2 Scope of the Act

 

This Act shall apply to:

 

a. Commonhold land formed in accordance with the provisions of section 5

 

b. Commonhold land fulfilling the requirements established in section 396 of the Civil Code and for which no commonhold community statement has been filed. In any case, for matters relating to the legal system of ownership of private units and common parts, and for those regarding reciprocal rights and duties of commonholders, these commonholds shall be regulated by the provisions of this Act.

 

c. Private real estate developments, in the terms stipulated in this Act.

 

d. Sub-commonholds, as defined according to the title of the commonhold as when any of the co-owners hold certain facilities or communal services for independent use and enjoyment, endowed with economic or functional independence.

 

e. Development Maintenance Entities if provided by their Articles.

 

Section 3 Units and common parts

 

In the ownership system set forth in section 396 of the Civil Code, each flat or premises owner shall have:

 

(a) The absolute ownership right over an space sufficiently delimited, intended for independent use and enjoyment, along with the architectural elements and facilities of any kind, whether apparent or not, included within its boundaries and for the exclusive service of the owner, as well as any appurtenances specifically laid down in the commonhold community statement, including those located outside the delimited space.

 

(b) Joint ownership, in conjunction with the other owners of flats and premises, of the remaining common parts, belongings and shared facilities. A percentage of the commonhold shall be allocated to every flat or premises in relation to the value of the building and expressed as a percentage of it. Said allocation shall serve as a basis to determine participation in the expenses and benefits of the commonhold. Improvements or impairments of each flat or premises shall not affect the commonhold allocation, which may be altered only in accordance with the provisions of sections 10 and 17 of this Act.

 

Each owner can make free use of his ownership right, but he may not separate the elements composing it and the transfer of the right of use shall not affect the obligations arising out of this property regime.

 

Section 4 Pro-communal elements

 

Action of division shall not proceed to cease the situation governed herein. Subdivision may only be carried out by each pro indiviso owner of a particular flat or premises with regard to such unit, provided joint ownership was not expressly established for the common service or benefit of all the commonholders.

It should be stressed that there is confused wording in this section. It is clear that commonhold law, because its nature, does not allow division of the common elements , therefore the first paragraph of this section is useless.

But this section 4 is not dealing with division of common parts but with another kind of element which may exist in some commonholds.

 

Section 5 The title to the commonhold CCS

 

The Commonhold Community Statement shall describe, besides the building as a whole, each one of the units which shall be serially numbered. The description of the overall property shall set forth the circumstances required by mortgage law, along with the building’s facilities and services.

The description of each flat or premises shall express its size, boundaries, the floor on which it is located and any appurtenance part such as garage, space attic or basement.

 

The title shall set the commonhold allocation corresponding to each flat or premises as established either by the sole owner of the building at the beginning of the sale of flats, by agreement of all existing owners, by arbitration award or by court decision.

The basis for determining the percentage of the commonhold allocation shall be the usable area of each flat or premises in relation to the building as a whole, its interior or exterior location, its situation and the reasonable foreseeable use of common elements and shared services.

 

The Commonhold Community Statement may also contain rules and regulations concerning the exercise of rights and other provisions not prohibited by law relating to the use and purpose of the building, its various flats or premises, its installations and facilities, expenses, administration and management, insurance, maintenance and repairs, making provisions that shall not prejudice third parties if they have not been registered with the Land Registry.

 

For any amendment of the Commonhold Community Statement, the same requirements shall be observed as for its creation, except as otherwise provided regarding the validity of the commonholders’ agreement.

 

Section 6 Internal Rules

 

In order to regulate the particulars of co-existence and the appropriate use of the services and common parts, and within the limits stated by the Act and the Articles, the group of owners may set forth internal rules, which shall be binding on all owners until amendment in the form prescribed for making resolutions regarding administration.

 

Section 7 Restrictions on alterations to units and dispute resolution 

 

(1) The owners of each flat or premises may modify the architectural elements, installations or services of their flat or premises, giving prior notice to the commonhold representative provided such work does not diminish or alter the safety of the building, its general structure, its external image or configuration, or prejudice the rights of another proprietor. The owner and the occupant of the flat or premises shall not make any alteration in the rest of the estate . If the owners notice the need for urgent repairs, they shall inform the administrator without delay.

 

(2) The owner and the occupant of the flat or premises shall not carry out in such flat or premises, or in the rest of the building, any activities which are not permitted by the Articles , or which may cause damage to the estate or contravene the general regulations concerning nuisance, unhealthy, noxious, hazardous or unlawful activities.

The president of the commonhold association, on his own initiative or at the request of any owner or occupant shall request the immediate ceasing of any of the activities banned by this section under warning of appropriate court action. If the offender persists in his/her conduct, the president, subject to the authority of the Owner’s Committee, duly convened for this purpose, may undertake a court injunction procedure, which, insofar as not expressly provided for in this section, shall be handled by ordinary procedure.

Once the action is brought, along with the accreditation of formal notification to the offender and the certification of the resolution adopted by the Owners’ Committee, the court may order as a precautionary measure the immediate cessation of the prohibited activity, under admonition of incurring an offence of contempt.

 

Furthermore, the judge may adopt any provisional measures necessary to ensure the cessation order. The action must be brought against the proprietor and, if fitting, against the occupant.

If the judgement were for the claimant, it may decree, besides definitive cessation of the prohibited activity and the awarding of damages as may correspond, the forfeiting of the defendant’s right to use the flat or premises for no more than three years, depending on the seriousness of the infringement and mischief caused to the commonhold.

If the infringer were not the owner, the judgement may definitely terminate the offender’s rights to the flat or premises and order his immediate eviction.

 

Section 9 Owners’ duties

 

(1) The duties of each owner include:

 

(a) to respect the general installations of the commonhold and any other common parts: whether for general or exclusively use by all or any of the co-owners; whether included in their flats or premises or not. The facilities should be used with due care and the causation of damage or deterioration should be avoided at all times.

 

(b) to maintain their own flat or premises and private installations thereof in a good condition so that no harm is caused to the commonhold or other owners. An owner shall indemnify the commonhold for any damages produced by their carelessness or by their dependants for whom he is responsible.

 

(c) To consent to any repairs in their flat or premises required to service the building. They shall also permit any essential easements required to maintenance work, actions or develop shared facilities carried out or agreed, pursuant to what is set forth in this Act, being the owner entitled to satisfaction from the commonhold for any damage and prejudicial consequences.

 

(d) to allow entry to their flat or premises for the purposes laid down in the three previous paragraphs.

 

(e) to contribute, according to the commonhold allocation specified in the commonhold community statement or to what may have been specially established, to the overall expenses for the appropriate maintenance of the building, its services, burdens and any responsibilities that cannot be allocated individually.

 

The amount payable to the commonhold association stemmed from the duty to contribute towards the maintenance and general expenses of the commonhold corresponding to the fees assessed for the period to date of the current and previous 3 years shall be deemed preferential under the terms of section 1923 of the Civil Code, and they come, as regards settlement, before those stated in subsections 3, 4 and 5 of said section, subject to the guarantees in favour of salaries and wages established in the Workers’ Act .

 

Any person acquiring a house or premises with commonhold land, even when its title is entered in the Land Registry, shall be liable, with the acquired property as guarantee of any outstanding amounts payable owed by previous owners.

 

This liability includes general expenses up to the limit of the fees assessed for the period to date of the year when the transfer of ownership took place and for the immediately precedent three years. The flat or premises shall be legally encumbered for the fulfilment of this obligation. In the registered deed by which the ownership is transferred, the transferor shall include a statement declaring that he or she is up to date with the general expenses of the commonhold; or if he is not he must list the amount owed.

The transferor must present this statement with a certificate concerning the state of his balance with the commonhold. This shall coincide with said statement. Execution of the deed shall not be authorised unless the transferee should expressly discharge such requirements.

The certificate shall be issued by the person acting as secretary within seven calendar days from the request, with the approval of the president. Both shall be accountable, in case of blame or negligence, for the accuracy of the data on the certificate and for any damages resulting from delay in issuing it.

 

(f) to contribute, according to their respective commonhold allocation, to the endowment of the reserve fund that shall exist in the commonhold for the maintenance and repair of the building. The reserve fund, which shall belong to the commonhold to all effects, shall be endowed with an amount not lower than five percent of its last ordinary budget. This fund may also be used by the commonhold to take out an insurance policy covering damages to the building or, alternatively, to undertake a contract for permanent maintenance of the building and its general installations.

 

(g) to observe due care in the use of the property and in their relationship with the other owners and to account for any infringement or damages.

 

(h) to notify the person acting as secretary , by any means ensuring proper evidence of service for the domicile in Spain for the purpose of receiving summons or communications of any kind related to the commonhold. In absence of this notification the flat or premises shall be deemed to be the owner’s domicile by default, and any notices served on the occupant shall constitute full legal effect.

Should service of notification or summons at the place indicated in the preceding paragraph be impossible, it shall be deemed to have taken place if the communication is affixed on the notice board of the commonhold, or at a visible place set aside for this purpose.

The notice should, indicate the date and the reason for which this form of notification is used, should be signed by the person acting as secretary and endorsed by the president. A notice served in this way shall produce full legal effect following the term of three calendar days.

 

(i) to notify the person acting as secretary of the commonhold, by any means providing certification of delivery, the change of ownership of their flat or premises. Any owner failing to comply with this duty shall remain liable to the commonhold, jointly with the new owner, for debts incurred after the transfer; but shall be able to claim refund from the new owner.

The rules laid down in the preceding paragraph do not apply when any of the governing bodies specified in section 13 have been aware of the change of ownership of the house or premises, by any other means or as a results of conclusive actions of the new proprietor, or when the transfer is well-known.

 

(2) For the application of the rules set forth in the preceding paragraph, those expenses not attributable to one, or several flats or premises, shall be deemed general expense. The non-use of a service shall not exempt the owner from fulfilment of the corresponding obligations subject to the terms of section 17(4) of this Act.

 

Section 10 Carrying out repairs by the commonhold

 

(1)  The following actions shall be compulsory and shall not require prior resolution of the Owners’ Committee , whether or not they entail amendment of the title or of the Articles when they are imposed by Public Administration bodies or demanded by unit Owners

 

a) Works or actions as may be necessary for the adequate maintenance and fulfillment of the duty of upkeep of the building and its common services and facilities, including, in any case, those needed to satisfy the basic requirements of safety, habitability and universal accessibility, as well as conditions regarding appropriate appearance and any other arising from the imposition by the Public Administration of the legal duty of conservation.

 

b) Works or actions as may be necessary to ensure reasonable adjustments regarding universal accessibility and, in any case, those required at the request of owners of units where disabled people or over the age of 70 are living, working or providing altruistic or voluntary services, in order to allow appropriate use of common elements adapted to their disability, as well as the installation of ramps, lift or other mechanical or electronic devices favoring their orientation or communication with the outside provided the cost of such work charged annually, after deducting any public aid or subsidy, does not exceed the ordinary monthly common expenses for a twelve-month period. The fact that the cost in excess of the aforementioned monthly expenses is assumed by those who requested the works does not suppress the compulsory nature of such works.

 

c) The occupation of common elements in the building or private real estate development during the duration of the works referred to in the. preceding paragraphs.

 

d) The construction of new floors and an other alteration to the structure or the supporting walls of the building or common elements, as well as the setting up of a real estate development, as provided by subsection 17(4) of the consolidated text of the Land Act approved by Royal Legislative Decree 2/2008, of 20th June, which may be required as a result of the inclusion of the building within the scope of action of urban rehabilitation, regeneration or renovation.

 

e) Actions for the material division of units and their appurtenances to form other, smaller, independent units, their enlargement through aggregation of adjoining units in the same building, or reduction thereof through separation of some of their constituent parts, carried out by will and at the initiative of their owners, where such actions are possible as a result of the inclusion of the building within the scope of action of urban rehabilitation, regeneration or renovation.

 

(2) Taking into account the necessary or compulsory nature of the works or actions referred to under (a) to (d) of the preceding subsection, the following shall apply:

 

a) The cost of the relevant works shall be borne by the unit owners of the relevant community or group of communities, and the resolution of the Owners’ Committee shall be limited to the apportionment of the relevant levy and the determination of the payment terms thereof.

 

b) Unit owners exercising opposition to or causing delay of the execution of orders decreed by the appropriate authority shall be held accountable individually and be subject to administrative sanctions.

 

c) The obligation to satisfy expenses arising from the works stated above shall be attached to the unit in the same terms and conditions as those established in section 9 for general expenses.

 

3. In any case, the following shall require administrative permission:

 

a) The constitution or modification of the real estate development referred to in section 17.6 of the consolidated text of the Land Act approved by Royal Legislative Decree 2/2008, of 20th June, in the terms provided for therein.

 

b) Where so requested, subject to prior approval by three fifths of the total number of owners representing in turn three fifths of the whole allocations , the material division of individual units and their appurtenances to form other, smaller, independent units; the enlargement of their area through aggregation of adjoining units in the same building, or reduction thereof through separation of some of their constituent parts; the construction of new floor-sand any other alteration to the structure or the supporting walls or pillars of the building or common elements, including the enclosure of balconies and the modification of exterior walls or roofs to improve energy efficiency, or of common elements, where the requirements referred to in subsection 17.6 of the consolidated text of the Land Act approved by Royal Legislative Decree 2/2008, of 20th June. In these cases, the consent of the unit owner involved shall be required and the general meeting shall determine, in agreement with these owners, by resolution of the three fifths of the total number of owners, compensation for damages as appropriate.

 

The Owners’ Committee shall establish the new assessment quotas and determine the nature of the works to be carried out; in case of discrepancy in this respect, the resolution of the Owners’ Committee shall be adopted by the same [i.e. 3/5] majority. In this respect, interested parties may also apply for arbitration or for a technical opinion in the terms set out in law.

 

Section 11 Abolished

 

Section 12 Abolished 

 

Section 13 Governing bodies in the commonhold 

 

(1) The governing bodies of the commonhold shall be the following:

 

a) The Owners’ Committee.

b) The president and, where applicable, the vice-president.

c) The secretary.

d) The administrator.

 

The Articles of the commonhold association or a majority resolution from the Owners’ Committee may establish other governing bodies of the commonhold, but only insofar as this does not entail any impairment whatsoever of the roles and duties regard to third parties that this Act confers to the aforementioned.

 

(2) The president shall be appointed from among the owners by election or, if this could not be achieved, by rotation or drawing lots. Acceptance shall be compulsory, although the owner designated may request the court to relieve him within one month of taking office, invoking the reasons for it.

 

The judge, following the procedure laid down in section 17 (7), shall rule on the matter, designating in the same order, the owner who shall replace the president in office until such time as a new appointment is made within the term determined in the court’s resolution.

Likewise, the judge may be approached where, for any reason whatsoever, the Owners’ Committee found impossible to appoint a president.

 

(3) The president shall legally represent the commonhold both in and out of court in all matters affecting it.

 

(4) The existence of vice-presidents shall be optional. They shall be designated by the same procedure set forth for the appointment of the president. The vice-president, or vice-presidents in the order prescribed, shall replace the president in cases of absence, vacancy or incapacity, and assist him/her in the exercise of his/her duties under the terms established by the Owner’s Committee.

 

(5) The functions of secretary and administrator shall be exercised by the president of the commonhold except when the Articles, or the Owners’ Committee by majority vote, provide that such offices be held separately from the president.

 

(6) The office of secretary and that of administrator may be held by the same person or by persons appointed separately. The position of administrator and, where applicable, that of secretary-administrator may be occupied by any owner, or by individuals with adequate professional qualification and legally licensed to perform such functions. It may also be held by a corporation or other juristic person in the terms set out by law.

 

(7) The term of office for all governing bodies of the commonhold shall be of one year unless otherwise stated by the Articles. The persons appointed may be removed from their posts before the expiration of their term of office by a resolution of the Owners’ Committee, convoked for an extraordinary meeting.

 

(8) Where the number of owners in a building does not exceed four, they may opt for the administration system provided for in section 398 of the Civil Code if so prescribed by the Articles.

 

Section 14 Powers of the Owners’ Committee

 

The functions of the Owners’ Committee shall be:

 

(a) To appoint and to remove persons for the aforementioned offices in the previous section and to deal with any claims presented by owners against the performance of their functions.

 

(b) To approve the budget of foreseeable expenses and income and the corresponding accounts.

 

(c) To approve estimates and authorise all repair works to be performed on the property, whether ordinary or extraordinary, and to be informed of any urgent measures adopted by the administrator in accordance with the terms of section 20 (c)

 

(d) To approve or amend the Articles and establish the internal rules.

 

(e) To inquire into and resolve on the other matters of general interest to the commonhold, adopting those measures deemed necessary or advisable for the best common service .

 

Section 15 Attendance and voting at meetings 

 

(1) Attendance at the general meeting shall be in person or by legal or voluntary representation, for which a writing signed by the owner is sufficient accreditation.

Where a flat or premises belongs jointly to different owners, these shall name one representative to attend and to vote on their behalf in the meetings. Where a flat or premises is held in usufruct , the freehold owner shall be entitled to attend and vote, but unless otherwise stated, shall be presumed to be represented by the usufructuary.

However, express representation shall be required for resolutions referred to in the first provision of section 17 or on extraordinary repairs or improvements.

 

(2) Owners who at the time the meeting is called are not up-to-date with payments of outstanding commonhold charges and have not judicially challenged them, or deposited the amount thereof in court, or with the notary public shall be allowed to take part in the debates but are not able to vote.

The minutes of the meeting shall record the names of the owners deprived of their voting rights, and neither the person nor the respective allocation shall be computed in when calculating the majorities required by this Act.

 

Section 16 Notice of meetings

 

(1) The meeting of the Owners’ Committee shall be held at least once a year to approve the budget and the accounts. It shall also meet at any other time the president considers it advisable, or upon request of one quarter of the owners or a number representing, at least, 25 percent of the whole commonhold allocations.

 

(2) The notices for the meetings shall be made by the president or, failing this, by the promoters of the meeting. The notice shall include the items to be dealt with, the place, day and time of the first call and, where applicable, of the second call.

 

The notice shall be served in accordance with section 9.

The notice of meeting shall include a list of owners with outstanding debts to the commonhold and shall warn of the deprivation of their voting rights where the case falls within the situation expressed in section 15 (2).

 

Any owner may request the Owners’ committee to examine and resolve any matter whatsoever which concerns the commonhold.

 

For this purpose a request in writing should be sent to the president setting out clearly the items requested to be dealt with.

 

The president shall then include them in the agenda of the following meeting. Where a majority of owners representing a majority of the whole commonhold allocations are not present at the time of the first call, the meeting shall then be convened on second call without the need for a quorum.

 

The meeting shall be held on second call at the place and on the date and time set forth in the first call and may take place the same day at least half an hour later than the first call.

 

Failing this, it shall be called again, in accordance with the requirements established in this section within eight calendar days of the meeting of first call not having been held. In such a case, the notice of summons must be made at least three days in advance.

 

(3) The annual general meeting shall be called with at least, six days’ notice and extraordinary meetings shall be called with sufficient time to inform all parties involved. A meeting not called by the president may be legally held provided all owners are present and willing.

 

Section 17 Voting majorities system

 

Decisions of the Owners’ Committee shall be subject to the following rules:

 

1. The installation of the common infrastructures providing access to telecommunication services regulated by Royal Decree-Law 1/1998, of 27th February, or the or the adaptation of existing ones, as well as the installation of renewable energy supply systems, and the infrastructure necessary to access to the new collective energy supply systems may be agreed at the request of any one owner by a third of the members of the commonhold representing a third of the whole allocations.

The commonhold shall not charge to the owners, who did not vote in favour, the cost of the installation or adaptation of the said common infrastructures or, those derived from its conservation and maintenance.

Nonetheless, should they subsequently request access to telecommunication services or energy supply systems, which requires using the new infrastructures or the adaptation of the existing ones, they may be required to pay the amount that would have corresponded to them, duly updated with the application of the legal interest rate. Notwithstanding the previous paragraph concerning expenses for the upkeep and maintenance, the new infrastructure installed shall be deemed to be a common part for the purposes of this Act.

 

(2) Notwithstanding the provisions of section 10.1 (b), works carried out or new common services established to eliminate architectural barriers which hinder the access or the mobility of disabled persons and in any case the installation of a lift, even where such work or services may involve the amendment of the commonhold community statement or the Articles shall require the favourable vote of a majority of owners representing a majority of the whole allocations. When decisions are lawfully made to carry out works of accessibility, the commonhold will remain obliged to the payment of the expenses even if its amount exceeds twelve ordinary monthly rates of service charge.

 

(3) The establishment or elimination of the lift, janitor, reception and security services, or other common services or facilities of general interest, even where they involve the amendment of the Commonhold Community Statement or the Articles shall require the favourable vote of three fifths of the total number of owners, who must also represent three fifths of the whole commonhold allocations.

The lease of common elements lacking a specific use and the establishment or elimination of equipment or systems, other than those mentioned in subsection 1, which are intended to improve energy or hydro efficiency of the building,shall be subject to the same requirements. In the latter case, resolutions legally adopted pursuant to this rule shall be binding on all unit owners.

Nevertheless, if the equipment or systems have private enjoyment, it will enough the vote of a third of the owners representing a third of the whole allocations in order to pass such resolutions being applicable in this case the cost’s distribution established in the previous subparagraph.

 

(4) No owner may demand new installations, facilities, services or improvements not required for the correct maintenance, habitation safety and accessibility of the building, in accordance with its nature and characteristics.

However, where, with the favourable vote of three fifths of the owners representing three fifths of the whole allocations, resolutions are validly adopted to carry out innovations, new facilities, services or improvements not required for the adequate conservation, habitability, safety or accessibility of the building, and whose installation costs exceed the amount of three months of ordinary common expenses, dissenters shall not be bound, nor their fees modified, even where they cannot be deprived of the improvement or benefit.

 

If dissenters wish at any time to take advantage of the benefits of the innovation, they shall have to share in the cost of installation and maintenance, duly updated by application of the legal interest rate. Innovations impeding or barring any unit owner from using and enjoying any part of the building shall require, in any case, the recorded express consent of such owner.

 

(5) The installation of a charging station for electric vehicles for private use in the building’s parking area, provided said station is installed in an individual garage space, shall only require prior notification to the community. The cost of the installation shall be borne by the interested party or parties.

 

6. Those resolutions not expressly regulated under this section involving the approval or amendment of the rules contained in the master deed or in the Articles shall require unanimity of the total owners and of the whole allocations

 

(7) All other resolutions shall be adopted with the vote of a majority of the total number of owners representing a majority of the whole allocations.

Where the meeting is held on second call, the decisions adopted by a majority of those present shall be valid if they represent more than half the value of the allocations of those present.

When a majority cannot be reached by the procedures provided for in the foregoing paragraphs, the judge, at the request of an interested party, made within a month of the date of the meeting held on second call, and after hearing the litigants in court appearance, duly notified, shall determine in equity within twenty days from the date of the petition, awarding legal costs to the corresponding part.

 

(8) Except in the cases expressly provided where the cost of services is not to be charged to those unit owners who did not expressly vote in favour of the resolution at the general meeting, or in cases where the modification or renovation is to be done for private use, the votes of duly summoned unit owners absent from the meeting shall be computed as favourable if, having been informed of the resolution adopted by those represent in conformity with the procedure established in section 9, they did not state their dissent to the person acting as community secretary, within thirty calendar days, by any means ensuring record of deliver

 

9. Resolutions legally adopted under the provisions of this Act shall be binding on all unit-holders.

 

10. Discrepancy concerning the nature of works to be carried out shall be resolved by the owners’ general meeting. The interested parties may also apply for arbitration or for a technical opinion in the terms established by law.

 

11. Special assessments for the implementation of improvements made or to be made in the building shall be at the expense of whoever is the unit owner at the moment when the amounts corresponding to such improvements.

 

Section 18 Owners’ Committee resolutions

 

(1) The decisions adopted by the Owners’ Committee may be challenged in court, in accordance with the terms of the general procedural rules, in the following circumstances:

 

(a) When such resolutions are contrary to the Act or to the Articles.

 

(b) Where they are seriously damaging to the interests of the commonhold and benefit one or several owners.

 

(c) Where cause serious damage to an owner who has no legal obligation to sustain such detriment, or where they have been adopted in abuse of law.

 

(2) Owners who recorded a dissenting vote at the meeting, those who were absent for any reason and those who were improperly deprived of their right to vote shall be entitled to challenge these decisions.

In order to challenge a resolution, an owner must have satisfied all commonhold levies or, alternatively, must have paid them into court before proceedings.

This provision shall not apply to the challenging of resolutions relating to the alteration of owners’ allocations, as referred in section 9.

 

(3) The action shall lapse three months after the adoption of the decision by the Committee or one year in the case of resolutions contrary to the Act or against the Articles.

For owners not present at that meeting, this time limit shall begin to run from the date on which the notice has been received, in pursuance of section 9.

 

(4) Where a decision of the Owners’ Committee is challenged in court, its enforcement shall not be suspended, unless the judge, at the claimant’s request and having heard from the commonhold association, resolves to suspend it as a precautionary measure.

 

Section 19 Book of minutes

 

(1) The resolutions of the Owners’ Committee shall be recorded in a book of minutes stamped and validated by the Land Registrar in the form set out by the applicable regulations.

 

(2) The minutes of each meeting of the Owners’ Committee are required to express at least the following:

 

a. The date and place of the meeting

b. The person who summoned the meeting and, where appropriate, the owners who promoted it

c. Whether it was an ordinary or extraordinary and whether it was held on first or on second call

d. List of those present and their respective offices; as well as owners represented

e. The agenda for the meeting

f. The decisions adopted, with indication, where relevant for the validity of the resolution, of the names of owners who voted in favour and against, as well as the allocation corresponding to each owner.

 

(3) The president and the secretary shall sign the minutes at the end of the meeting or within the following ten days.

Once the minutes are signed, the decisions shall be in force, unless otherwise disposed by law.

The minutes shall be sent to the owners, pursuant to the procedure set out in section

 

9. Any defects or errors contained in the minutes may be rectified provided that they are signed by the president and the secretary and that the date and place of the meeting are unmistakable expressed, as well as the names of those owners present and those represented, the decisions adopted, the votes in favour and against, and the allocation thereby represented. Rectifications shall be made before the following meeting of the Owners’ Committee and submitted to it for ratification.

 

(4) The secretary shall have custody of the Owners’ Committee minutes book and he shall hold the summons for meetings, notices, proxy-forms and other relevant documents for at least a five-year period.

 

Section 20 Administrator’s duties  

 

It shall be the function of the administrator:

 

(a) To watch over the proper management of the commonhold, its installations and services, and to advise and admonish owners to that effect.

 

(b) To prepare the budget of predictable expenses with sufficient anticipation and to submit it to the Owners’ Committee, proposing measures to cover the expenses.

 

(c) To see to the upkeep and maintenance of the commonhold, arranging for urgent repairs and measures, reporting promptly to the president or, where appropriate, to the owners.

 

(d) To carry out the decisions adopted regarding maintenance works and to make and receive payments as appropriate.

 

(e) To act, where applicable, as secretary of the Owners’ Committee and to keep custody of commonhold documents available for the owners.

 

(f) Any other function conferred by the Owners’ Committee

 

Section 21 Action for arrears recovery 

 

(1) The obligations referred to in section 9 (1) (e) and (f) shall be fulfilled by the owner in the time and form determined by the Owners’ Committee. Otherwise, the president or the administrator, if so agreed by the Owners’ Committee, may seek judicial redress through the order of payment procedure.

 

(2) Use the order of payment procedure shall require prior certification of the Owners’ Committee decision approving the debt settlement due to the commonhold, issued by its secretary and with the approval of the president, providing said decision has been notified to the owners concerned in the form set out in section 9.

 

(3) Sums arising from expenses incurred in the prior demand for payment may be added to the amount claimed by virtue of the provisions of the preceding subsection provided there is documentary evidence of the previous claim and that proper receipts for said expenses are attached to the application.

 

(4) When the previous owner is jointly and severally liable for the outstanding debt, and notwithstanding his right to bring a claim for restitution against the current owner, action may initially be brought against the former.

The action may also be brought against the titleholder appearing on the Register, who shall be entitled to the aforesaid right. In all these cases, the initial petition may be filed against any of the parties to the obligation or jointly against all of them.

 

(5) Where the debtor opposes the initial claim provided for in the order of payment procedure, the creditor may seek a provisional attachment on debtor’s assets as deemed sufficient to cover the amount claimed plus interest and court costs. In any case, the judge shall order provisional attachment without asking the creditor for caution. The debtor may enervate the garnishment by providing a bank guarantee for the amount for which the freezing was ordered.

 

(6) Where in the initial application of the order of payment procedure the professional services of lawyer and legal proxy are used to claim sums due to the commonhold, the debtor shall pay, subject in any case to the limits set forth in rule 394 (3) of the Civil Procedure Rules, the fees incurred as a result of their intervention, irrespective of whether the debtor satisfied the payment requested or did not appear in court. In those cases where there is opposition, the general provisions regarding legal costs shall be followed.

However, should the creditor’s claim be fully upheld, it should be included the lawyer’s and legal proxy’s fees, even where their intervention was not legally compulsory.

 

Section 22 Commonhold liabilities

 

(1) The commonhold shall be liable for all its assets for any debts to third parties. In addition, the creditor may claim from every owner who was party to the corresponding process, for the payment of his/her percentage of the amount left unsatisfied, having served a request for payment on such owners.

 

(2) Any owner may oppose execution if he/she accredits that all debts due to the commonhold are fully settled at the moment the request for payment mentioned in the preceding subsection.

 

Section 23 The termination of the commonhold  

 

The commonhold shall terminate:

 

(1) By the destruction of the building. Notwithstanding any covenant to the contrary, destruction shall be deemed to have occurred when the cost of rebuilding shall exceed fifty percent of the value of the property at the time the event occurs; unless the excess of the aforesaid cost is covered by insurance.

 

(2) By conversion to ordinary ownership or co-ownership.

 

Section 24 Private real estate developments

 

(1) The special system of ownership established in section 396 of the Civil Code shall apply to private developments that meet the following requirements:

 

a. Being formed by two or more detached buildings or independent plots between them used mainly as dwellings or premises.

 

b. Owners of such buildings or of the units in which they are divided participate in an indivisible co-ownership of other immovable elements, roads, facilities or services.

 

(2) The private developments referred to in the preceding subsection may:

 

a. Constitute one commonhold through any of the procedures provided for in section 5 (2). In this case they shall be subject to the provisions of this Act, which shall be entirely applicable to them.

 

b. Create an association of commonholds. For this purpose, the commonhold community statement must be executed by the sole owner of the development or by all the presidents of the component commonholds, duly authorised by majority vote of their respective Owners’ Committee . The commonhold community statement shall include the description of the whole development and of the common parts, roads, installations and facilities. It shall also contain the percentage established for each one of the component commonholds. These shall be jointly liable for the general expenses of the association. The commonhold community statement and the articles of the association may be registered at the Land Registry.

 

(3) The aforementioned association shall enjoy the same legal status as commonholds and shall be governed under the provisions of this Act with the following specifications:

 

a. The Owners’ Committee shall be formed, unless otherwise agreed, by the president of each component commonhold in representation of its individual unit owners.

 

b. The adoption of resolutions for which the law prescribes qualified majorities shall require, in turn, a prior appropriate majority at the Owners’ Committee of each one of the commonholds belonging to the association.

 

c. Unless the Owners’ Committee decides otherwise, the provisions of section 9 concerning a reserve fund shall not apply to the association. Duties of governing bodies of the association shall only cover common elements, roads, installations and facilities or services.

 

Their decisions shall in no event diminish the powers of the governing bodies of the component commonholds.

 

4. Provisions of this Act, with the same specifications indicated in the preceding paragraph, shall apply supplementarily to covenants adopted by and between owners in the case of those developments that do not adopt any of the legal forms provided in subsection 2 of this section.

 

Additional provision

 

1. Notwithstanding the provisions enacted by Regional Governments in the exercise of their powers, the creation of the reserve fund regulated in section 9.1.f) shall comply with the following rules:

 

a) The fund shall be created at the time the general meeting approves the ordinary community budget corresponding to the financial year immediately after this Act takes effect. Communities formed after this Act takes effect shall create their reserve funds when adopting their first budget.

 

b) Initially, the fund shall be endowed with no less than 2.5% of the ordinary community budget. For this purpose, unit owners shall make in advance the necessary contributions in accordance with their respective assessment quota.

 

c) When the ordinary budget for the financial year following the creation of the reserve fund is approved, said fund should be endowed with the amount necessary for it to attain the minimum amount established in ssubsection 9.(2)

 

The amount of the reserve fund shall not, at any time during the fiscal year, be under the limit legally established.

 

Those amounts drawn from the reserve fund during the financial year for financing the cost of works or actions included in Section 10 shall be computed as part of the fund for the purposes of calculating its minimum amount.

Those contributions necessary to cover the amounts detracted from the reserve fund shall be effected at the outset of the following financial year in accordance with the provisions of the preceding paragraph.