THERE seems to be a serious problem regarding the establishment and functioning of management committees of communal areas in building complexes due to the lack of interest by owners of units. The issue negatively effects the owners, who are obliged to pay higher communal charges to management companies which deal with the management and maintenance of communal areas and are paid for their services. Mainly developers and a few other companies realised the profitability of their engagement in the provision of such services and they are doing business in this respect. This is the reason why most purchasers are asked at the time of signing the sale contract or at the time of the completion of their property to appoint a management company to be responsible for a fixed or indefinite period of time for the management and maintenance of communal areas. Moreover, they are asked to pre-pay their contribution, fixed by the management company, without the purchasers being entitled to decide either to reject or accept the appointment or the charge because otherwise they are told that the property will not be delivered to them.
Although the owners find the charge unreasonable and excessive, in their effort to take delivery of their property and for someone to be responsible for the maintenance and management of the communal areas, they consent. Many of the owners do not permanently live in their properties and consequently they show no interest in the cleaning and maintenance of the communal areas and prefer to employ the services of a management company. Evidently, it is the company that fixes the communal charge payable by each owner instead of the management committee elected by the owners. The relation between the owners and the management company becomes contractual and therefore, the company is entitled to sue an owner who omits or refuses to pay the charge for services rendered. The right of action derives from the management agreement and not from the law for the management committees. The relation created between the owners and the company is based on the services rendered by the company on a fixed and agreed consideration – remuneration which is not considered as common expenses in the ordinary meaning of the term.
Despite the pros and cons of the use of a management company, the owners should show interest in participating in the formation and functioning of a management committee in their building complex. By doing so, they will be the ones to decide which company they will employ, under what fee, whether the company is doing the work properly and the communal charge each owner will pay. In this respect, the owners may adopt the standard regulations provided in law to be applied for the management of the communal areas of their building complex. These regulations provide equality and fairness between the owners and in the event of any dispute arising, they provide a solution. The management committee will operate on behalf and for the owners and is entitled to sue or be sued for any matter concerning the communal areas of the building. The people who form the committee do not act in their personal capacity but as a body in the name of the management committee.
The management committee is responsible for looking after, administering and managing the communal areas, to keep them clean, in good condition, operational and available for use by the owners. A management committee can be registered at the Land Registry after title deeds are issued, defining thereby the communal ownership and the areas of common use. The standard regulations can be amended by the committee and new regulations may be introduced wherever necessary. The owners should attend a meeting personally or through a proxy once a year and receive accounts for the passed management and its doings.
George Coucounis is a lawyer specialising in the Immovable Property Law, based in Larnaca, Tel: 24 818288, [email protected], www.coucounislaw.com
