Declaration of co-ownership

The constituting act of co-ownership contains, among other things:

• the destination of the immovable (residential, commercial, industrial, mixed-use, etc.);
• the destination of the private portions and the common portions;
• the relative value of the fractions, i.e. the share of each fraction in the common portions;
• the distribution of powers and duties between the board of directors and the general meeting of co-owners (which are the two decision-making bodies of the co-ownership);
• the number of votes assigned to each co-owner, etc.;
• where applicable, the penal clause (which fixes the monetary sanctions to be paid by co-owners for failure to comply with the declaration of co-ownership).

The destination of the immovable is one of the most important concepts in divided co-ownership, as it defines the limits of individual rights while ensuring their ultimate protection. It can be seen as the immovable’s “personality.”

The constituting act of a divided co-ownership defines the destination of the immovable and of its private and common portions. If the constituting act specifies that the immovable is for residential use, a co-owner cannot operate a daycare in his private portion. It is therefore important for a buyer to check the constituting act in the declaration of co-ownership, with the help of his broker, to ensure that the limitations to the right of ownership are acceptable to him. These clauses of the constituting act are a factor of utmost importance in determining the destination of the immovable, but it is the entire declaration of co-ownership which defines it. The clauses of the declaration relating to the conditions of enjoyment of the private and common portions, which are contained in the by-laws of the immovable, also contribute to this.

This being said, the concept of destination of the immovable is not limited to a simple mention in the declaration of co-ownership. It includes the physical characteristics and location of the immovable, as well as the type of property desired by the co-owners. The characteristics and location of the immovable are reflected in the quality of the construction and the materials used, the harmony of the building complex, the interior and exterior layouts, the particular environment or geographical location of the immovable (for example, whether it is located in an upscale or popular neighbourhood or near a waterway, ski hill, golf course or highway, or in the heart of a tourist town).

By-laws of the immovable

The by-laws of the immovable cover matters related to the enjoyment, use and maintenance of the private and common portions. The by-laws also establish the rules concerning the operation and management of the co-ownership, including board meetings procedures, rules governing the holding of meetings of co-owners, and procedures for the collection of common expenses.

The broker and the buyer must review the constituting act and the by-laws of the immovable to determine whether the planned rules of cohabitation are compatible with the buyer’s expectations.

The by-laws of the immovable, like the rest of the declaration of co-ownership, are subject to amendment by the meeting of co-owners. Unlike the amendments to the constituting act and the description of the fractions, the amendments to the by-laws of the immovable do not have to be notarized and published in the Land Register. It is therefore essential that the broker ask the selling co-owner or the syndicate of co-owners for a copy of the by-laws of the immovable, because not all the rules will necessarily be found in the declaration of co-ownership published in the Land Register.

Any “new” rules in the by-laws of the immovable are enforceable against co-owners from the time they are adopted by the general meeting of co-owners and filed in the register of co-ownership. However, the by-laws of the immovable are only enforceable against tenants once a copy thereof or of amendments thereto has been given to the tenant by the co-owner of the unit or by the syndicate of co-owners.

Some by-laws adopted at a general meeting of co-owners may be illegal, as the declaration of co-ownership (and its subsequent amendments) cannot restrict the rights of co-owners, unless such restrictions are justified by the destination of the immovable, its characteristics or location.

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Pets

The most frequent example is where the original declaration of co-ownership does not contain restrictions with respect to pets. The imposition by the syndicate of a measure prohibiting pets is likely to be invalidated by the court, unless this new prohibition or restriction is justified by the destination of the immovable, its characteristics or location (which is rather rare).

However, the right of a co-owner to prohibit his tenant from having pets is recognized. In fact, a co-owner who rents his fraction may prohibit pets in his private portion, as long as this restriction is mentioned in the tenant’s lease.

The syndicate may, however, restrict the presence of pets in the immovable’s common portions or common portions for restricted use.

In a particular case, a syndicate wanted to prohibit co-owners from allowing their dogs to wander around the backyard, hallways, and front or back stairs without a leash, and only for the purpose of accessing the building. The Court ruled that such restrictions were valid.

The courts have also deemed valid clauses in the by-laws of the immovable prohibiting co-owners from keeping “nuisance” pets in their private portions. The validity of such clauses would depend on how “nuisance pets” are defined. Normally, the “nuisance” nature of an animal will be determined by its behaviour within the co-owner’s unit (very frequent barking, aggressiveness, etc.).

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Recreational use of cannabis

The Cannabis Act (federal law) and the Act to constitute the Société québécoise du cannabis, to enact the Cannabis Regulation Act and to amend various highway safety-related provisions (provincial law) are intended to regulate the production, possession, and use of cannabis. These laws and their regulations went into effect on October 17, 2018.

In addition to asking questions, conducting verifications and disclosing any information obtained in order to properly advise the buyer regarding the use of cannabis in the co-ownership property, the broker must:

- verify whether there is a clause in the constituting act or the by-laws regarding the production or use of cannabis, and inform the buyer accordingly;
- keep abreast and inform the buyer of any change to this effect up to the signing of the deed of sale.

For more details: Coming into force of the Cannabis Act – New verification, disclosure and advice challenges for brokers and Cannabis – What you need to know

This part of the declaration of co-ownership makes it possible to identify each of the lots by registration number and to specify their nature. It lists the cadastral descriptions of each private and common portion of the co‑ownership (e.g. status and lot identification number). In addition, the description of the fractions indicates the real rights encumbering the immovable or existing in its favour, with the exception of sureties and additional security.

The immovable’s private and common portions must absolutely be the subject of a cadastral description in the declaration of co-ownership, so that they may be validly registered.

The description of the real rights encumbering the immovable and those in its favour corresponds to a technical description of these real rights, with the exception of hypothecs and additional security accessory thereto, in accordance with article 1055 of the Civil Code of Québec. The real rights to appear in this section, could be, without limitation, a usufruct or a real servitude (e.g. a right of way)

Source: condolegal.com – Contents of the declaration of co-ownership

For more details: Is it sufficient to send a certified copy of the declaration of co-ownership to the notary? and What you need to know before buying a co-ownership property