Once the budget is determined by the Board of Directors, the latter must send a notice to every co-owner of the amount of his contributions and of the date when payments are due.
Usually, this notice will take the form of a written notice addressed to every co-owner containing the details of the contributions (usually on a monthly basis) that the latter will have to pay to the syndicate over the next year. The building bylaws of the declaration of co-ownership contain provisions on the assessment procedure and collection of the contributions to the common expenses, such as the obligation to provide to the Board of Directors a series of cheques covering future monthly payments, as well as a procedure to be followed by the Board prior to legal action by the syndicate of co-ownership when a co-owner neglects or refuses to pay his common fees.
Loss of voting rights
Any co-owner who, for more than three months, has not paid his share of the common expenses or his contribution to the contingency fund, is deprived of his voting rights at the General Assembly of the co-owners.
Small Claims Court
The syndicate of co-ownership can file a claim with the Small Claims Division of the Court of Quebec against the co-owner who neglects or refuses to pay his contribution to the common expenses or his contribution to the contingency fund. The syndicate can only claim amounts that are unpaid at the date when the request is filed with the Court, but it does not cover future amounts which become due between the filing date and the date of the eventual hearing of the case and judgement. The monetary jurisdiction of this division of the Court of Quebec is limited to 7000 $. The syndicate cannot file a Small Claims Court claim if it had five employees or more in the previous twelve months.
Legal hypothecs
The syndicate of co-ownership can also publish a legal hypothec on the fraction of a co-owner who refuses or neglects to pay his share of the common expenses or his contribution to the contingency funds for a period of more than thirty days. It is set-up by filing a notice of legal hypothec in the Quebec Land Registry, indicating the nature of the claim, the amount of the unpaid expenses on the day of the registration of the notice, the expected amount of charges and claims for the current financial year and the next two years.
The publication remains valid for a three-year period beginning on the date of its registration. During this period the syndicate, if the co-owner persists in his refusal to pay his contribution to the common expenses, can choose to publish a prior notice of exercise (announcing its intention, in the majority of the cases, to ask the Court for the right to have the fraction sold by judicial sale and to ask for the Court for an order forcing the co-owner to leave the property), or file a legal claim asking the Court to order the co-owner to pay the amounts due.
This is a not very pleasant situation for the co-owner who is in default, not to mention the possible negative effects of his personal credit rating, due to the fact that his mortgage creditor will be automatically notified by the Quebec Land Registry when the legal hypothec is filed.
The responsibility of the purchaser for common expenses unpaid by the vendor
In 2002, the Civil code of Quebec was amended in such a way that a person who acquires a fraction of divided co-ownership becomes responsible for common charges left unpaid by the preceding co-owner. Article 1069 of the Civil code of Quebec states the following:
“A person who acquires a fraction of divided co-ownership, by whatever means, including the exercise of a hypothecary right, is bound to pay all common expenses due in respect of that fraction at the time of the acquisition.
A person contemplating the acquisition of such a fraction may request from the syndicate of co-owners a statement of the common expenses due in respect of the fraction and the syndicate is thereupon authorized to provide the statement to him, provided the syndicate gives prior notice to the owner of the fraction or his successors; in such a case, the prospective acquirer is only bound to pay the common expenses if the statement is provided to him by the syndicate within 15 days of the request.
The statement given to the buyer is adjusted to the last annual budget of the co-owners.”
It should be understood that if the prospective buyer doesn't make this request , they automatically become responsible to pay to the syndicate the common charges left unpaid by the selling co-owner.
Collection of the common fees from the co-owners by the syndicate: an important aspect of building management
