It’s been more that two years since a bill was drafted, designed to resolve longstanding challenges in the management of jointly-owned buildings, was published for public consultation.
The draft bill aims to solve a host of serious issues with the current law including the lack of management committees, non-payment of communal fees, insurance and partial or total destruction of the building. Its purpose is to provide management committees with the flexibility to carry out its obligations, to ensure that unit owners meet their obligations and that properties are properly maintained.
The proposed bill “The Management of Shared Buildings and Related Matters Law of 2023” and accompanying documents. which are currently being discussed in the Cyprus parliament may be downloaded by clicking here (Greek) and a machine translation of the draft law may be downloaded by clicking here (English.)
The main changes over the current law, which was introduced in 1993, are as follows.
Jointly-owned buildings supervisory service
A separate service will be established responsible for overseeing compliance with the law. The role of the Department of Lands and Surveys will be limited to issues relating to the occupancy and registration of jointly-owned buildings.
This new service will be responsible for registering jointly-owned buildings, the registration of management committees with the Service and maintaining a register of the buildings and their management committees.
In addition to jointly-owned buildings that have been registered, the law will apply to all jointly-owned buildings that have been issued with a building and sub-division permit, regardless of whether they’ve been issued with an approval certificate (or a certificate of unauthorised works) or registered with the Department of Lands and Surveys or issued with separate Title Deeds.
The Service may impose fines on management committees or owners who violate the law or related regulations. For illegal construction or alterations, the Service may seek court orders to rectify such actions.
Internal regulations will also be established to manage shared properties and determine owners’ rights and obligations. The Management Committee will be authorized to incur necessary expenses for maintaining common areas when owners who fail to pay communal fees.
The Service will create and maintains a register of jointly-owned buildings with information from the Department of Lands and Surveys, Town Planning, Municipal Authorities and District offices.
Units cannot be sold or leased if communal fees unpaid
The owners of units in jointly-owned buildings who fail to pay their share of communal fees will no longer be able to sell, lease or assign a contract of sale for their units until they’ve paid the communal fees.
In order to sell/lease/assign their unit, its owner must obtain a “Certificate of Common Expenses Clearance” from the Management Committee of their building, which certifies that all their communal fees have been paid.
This “Certificate of Common Expenses Clearance” may also be issued by a legally authorized representative of the Management Committee.
Structural Safety
The draft legislation also addresses the structural integrity of jointly-owned buildings and the safety of owners and residents. It enables Management Committees to carry out necessary maintenance work. Unauthorized/unapproved building or alterations undertaken without approval can result in court actions.
(As we reported last Friday, fire service spokesman Andreas Kettis said that it’s inconceivable that the bill says nothing about fire safety.)
The draft legislation applies to all jointly-owned buildings as described above.
Management committee powers
Each jointly-owned building must have a Management Committee responsible for managing its affairs. The committee will have powers to:
- Prevent owners who have not paid their communal fees and their tenants from using communal areas and facilities, providing this does not prevent them accessing their unit.
- Maintain and manage the jointly-owned property and ensure compliance with the law and regulations.
- Provide services for communal areas, limited to owners who are up-to-date with their communal fee payments.
- Create a fund for management expenses, repairs, and upgrades of the property.
General meetings of owners must be convened at least once a year or within 26 months, to review decisions and expenses.
Other significant changes
- The calculation of communal fees, which is based on the area of a unit is revised and is based on the covered area of the unit + 40% of the covered area of terraces and balconies + 20% of the uncovered area of terraces and balconies. (There are also variations for units depending on their use in mixed use buildings.)
- Members of the Management Committee must be owners.
- Unit owners may participate in general meetings using sound, video and audio systems and may vote using those systems.
- A jointly-owned building is known as a “shared building” and comprise the entire construction of the building.
- A jointly-owned property is known as a “shared property” and comprise every part of a “shared building” that is not registered as a unit.
Future changes
As MPs discuss the draft legislation, further changes may be introduced.
Hopefully, MPs will change the draft to allow Management Committees to collect a “Sinking Fund“ to put aside monies for unscheduled maintenance and repair of equipment that is not part of the planned annual maintenance activity. (This follows rulings in district courts that if the communal fund was in surplus there was no need for further contributions to the communal fees.)
Jointly-owned buildings FAQs
These frequently asked questions also apply to the current 1993 law:
Q. As I rent my apartment isn’t it my tenant who should be paying the maintenance charges?
A. No. As the buyer/owner of the apartment payment of the maintenance charges is your responsibility.
Q. I have an apartment on the ground floor, should I pay for maintaining the lift when I do not use it?
A. Yes. You are required to pay for maintaining all of the common facilities, including the lift, whether you make use of them or not.
Q. I only live in the apartment for three months of the year; shouldn’t my communal fees be reduced accordingly?
A. No. Regardless of how long you live in the apartment, you are required to pay the full annual amount.
Q. The developer promised that our communal swimming pool would be ready when we moved in; it isn’t. Can I withhold maintenance payments?
A. No. If the communal swimming pool was not ready as promised, why did you accept delivery?
Q. We have now got our Title Deeds and a Management Committee has been set up by people living in the flats permanently and they want everyone to pay the same amount. Can they do this?
A. No. The amount you pay is based on the size of your flat in relation to the others on the development.
Q. I have a 2-bedroom flat with a separate dining room but am being asked to pay more than my friend in the same block who has a 3-bedroom flat. Is this correct?
A. See the answer to the previous question. The amount you pay is based on the relative size of your flat compared to the others in the development.
Q. I look after a small garden outside our block of flats. I’ve planted shrubs, made a stone path and bought a garden bench. I also do all the weeding and keep it looking nice. Am I entitled to a discount on my management fees?
A. I’m afraid not. But perhaps the Management Committee would agree to paying you for the plants, etc. you bought and your labour.
Q. We have just taken delivery of our apartment and have received a bill for maintenance. This has come as quite a shock to us as we didn’t know about maintenance payments. Do we have to pay?
A. Yes. It sounds as if your lawyer did not advise you correctly when you bought the apartment. Your lawyer should have determined whether a Management Committee had been established and drawn up a contract for the payment of maintenance charges and insurance of the common areas.
The Jointly Owned Buildings Supervisory Service must have teeth.
In the case of delinquent maintenance payers, the Service must be able in law to enforce payment at the request of the Management Committee.
A defaulting owner would be held liable for all related costs.
I see nothing new in the laW. I hope it will be possible for bailiffs to seize debtors’ assets.
But we need to remember there may be genuine cases of hardship and some sort of payment schedule will be needed for some debtors.
Nigel,
Many thanks for this litigation update on how Jointly Owned Buildings buildings are to be managed.
It appears Management Committees will now be legally bound to recalculate and reapportion the covered and uncovered areas of each apartment of a Jointly Owned Building?
Management fees for our complex are currently calculated on covered/uncovered areas as supplied by our Developer.
Furthermore, and because of the failure of the Cypriot Judicial System’s continuing failure to resolve the transfer of property titles despite owners having fully honoured contractual purchase payment agreements, only around 30% of owners in our complex have received their apartment “titles”, so our current Management Committee cannot register our complex as a Jointly Owned Building.
Will the new law address the situation of “temporary” Management Committee administrations such as ours and allow us to operate “legally” until the required number of apartment owners with property titles (75%) is achieved, and they agree to register our complex as a JOB?
I understand that on 10/12/2024, the Attorney General will make a statement relating to those “trapped buyers”.
Hopefully, this will be positive??!!
Sincerely,
John Pearson
Secretary,
Nefeli Apartments Owners Association
Hi John
You don’t have to wait until Title Deeds are issued, ‘owners in waiting’ can form a management committee NOW if they wish (the current law enables them to do so.).
As I wrote in the article “…the law will apply to all jointly-owned buildings that have been issued with a building and sub-division permit, regardless of whether they’ve been issued with an approval certificate (or a certificate of unauthorised works) or registered with the Department of Lands and Surveys or issued with separate Title Deeds.”
Assuming MPs don’t change the new communal fee calculation, I expect there’ll be a transition period allowing a ‘smooth’ transfer to the new calculation. Maybe at the next AGM?
Regarding trapped buyers, I’m expecting something to happen by the end of the year. Let’s keep our fingers crossed.