Экзамен зачет учебный год 2023 / European Condominium Law

conditions, based on many generations of practical experience, is often available to conveyancers.64

However, the accompanying problem of this approach is that the law is varied to a degree unseen in any jurisdiction with a core statute. A tenement in Glasgow is most likely to have a completely different scheme from a tenement in Edinburgh. Even for tenements in the same area, the governing schemes may be drastically different depending on the firm of conveyancers who drafted them. More troublesome than consistency is the concern of certainty in terms of enforceability. Unlike rules or provisions from statutes, real burdens construed by an individual conveyancer may be challenged many years later on the grounds of validity, lack of title or interest to enforce, being obsolete, being personal rather than ‘praedial’ and so on.65 So, although everything looks fine on paper, when it comes to actual enforcement and operation of such schemes, there may be all kinds of difficulty and disputes. Fundamentally, people need to know what they can and cannot do with their own flats without hiring a solicitor to decipher an interpretation of a burden dated 1895.

Therefore, the Tenements (Scotland) Act 2004 was introduced to codify and clarify the previously disputed common law and to put in place a statutory Tenement Management Scheme (TMS). However, due to the prominence and influence of real burdens, the statute was never intended to be a revolution or defining piece of legislation, despite the fact it is the first tenement statute in more than 400 years. Subject to some very limited exceptions, the statute allows almost unfettered modification of most statutory rules by real burdens in individual titles. In other words, the statute is a modern version of the background law. Real burdens in individual titles are still the primary concerns of parties. The preference for real burdens over the statute is such that the Lands Tribunal has recently rated it as ‘unsatisfactory’ to rely on the statutory scheme by abolishing a disputed deed of condition.66

However, in 2009 a new form of tenement structure was made possible, namely, the Development Management Scheme (DMS) under

64The standard deed of conditions prepared by the Royal Faculty of Procurators in Glasgow is available in Sinclair, Handbook of Conveyancing Practice in Scotland (2002), no. [17.4].

65Scot Law Com No 162 pars. [2.25]–[2.28].

66Fenwick v. National Trust for Scotland (2009) GWD 32–538.

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the Title Conditions (Scotland) Act 2003.67 This only came into force on 1 June 2009. It may be seen as the first real alternative to the age-old system of tenement and real burdens. However, at this stage it is unclear what kind of impact the DMS will make on new condominium developments as well as the hundreds of thousands of tenements already under the existing TMS. Answers to these questions will identify the differences between TMS tenements and DMS tenements where appropriate, despite the fact there are very few, if any at all, DMS tenements in existence at the time of writing.

Although the introduction of sectional ownership to South Africa was mooted in the 1950s, the idea was not met with positive reaction, mainly on account of strong doctrinal opposition based on the maxim superficies solo cedit. However, in 1969 a new investigating committee reported that many individuals who ‘bought’ flats by means of share block schemes were in danger of suffering serious financial losses if they were not allowed to obtain ownership of these flats. A commission of enquiry visited New South Wales in 1970 and, encouraged by a favourable report, the first Sectional Titles Act was promulgated on 30 June 1971 and came into operation on 30 March 1973 after the necessary accompanying regulations were issued. The Act relied heavily on the New South Wales Conveyancing (Strata Titles) Act of 1961, and also drew inspiration from the German Law on Apartment Ownership of 1951. The main reasons advanced for the introduction of sectional ownership were first, the scarcity of affordable housing in the city centres, and second, the risk involved in buying into share block schemes.

The Sectional Titles Act of 1971 was replaced by a second-generation Sectional Titles Act 95 of 1986, which came into operation on 1 June 1988. While leaving the basic structure intact, the new Act streamlined the registration procedure and introduced several new mechanisms to cope with the demands of the modern sectional title industry, notably provisions on phased developments; the registration of exclusive use rights with regard to parts of the common property; the provision that the developer must determine the participation quotas for nonresidential units in a scheme; the prescription of model management and conduct rules in the regulations; and the provision that the developer must convene the first general meeting within sixty days after the

67Title Conditions (Scotland) Act 2003 (Development Management Scheme) Order 2009 (SI 2009/729).

establishment of the management body. The major amendments introduced by the Sectional Titles Amendment Act 44 of 1997 were the reduction of the proactive role of a local authority to approve sectional tile schemes; the expansion of the provisions on phased developments; and the provision for the less expensive establishment of exclusive user areas in the rules of a scheme.

Early in 2004, the Department of Land Affairs appointed consultants to investigate the possibility of an Ombud Service for the settlement of disputes in a sectional title scheme, and the possibility of separating the registration and management aspects of the current Sectional Titles Act. This activity culminated in the Community Scheme Ombud Service Act 9 of 2011 to replace arbitration as the mechanism to solve disputes and the Sectional Title Schemes Management Act 8 of 2011 amending the Sectional Titles Act so as to leave the registration aspects in the Sectional Titles Act, and to transfer the management aspects to the new Act. Thus, true third-generation sectional title legislation modelled on similar legislation of New South Wales and Singapore has arrived in South Africa.

5. Scandinavian countries

Although a form of apartment ownership in a multi-apartment residential building has been recognised in Iceland since 1959,68 Denmark only introduced an extensive statute on apartment ownership in 1960.69 Despite frequent campaigns in Scandinavia, a somewhat rudimentary form of condominium, namely, the Law on Owned Units, was introduced in Norway as recently as 1983. Although a new form of condominium known as privately owned apartments (a¨garla¨genheter) was introduced in Sweden in 2009, it has not gained popularity in practice, mainly due to the fact that an alternative to condominium known as a housing cooperative (bostadsra¨tt), which closely resembles American real estate cooperatives,70 continues to be widely used in Sweden. The same holds for Finland, where residential cooperatives are also prevalent.71

68Law of 1959; Seidel, Wohnungseigentum nach da¨nischem Recht. Eine vergleichende Darstellung

(1975), pp. 37–8; Ba¨rmann et al., WEG (ed. 4) Introd. no. 352.

69Law on Owner Apartments. See Seidel, Wohnungseigentum, 56.

70Siegler and Levy, ‘Brief history of Cooperative Housing’ (1986), pp. 12–19.

71Ba¨rmann et al., WEG (ed. 4) Introd. nos. 348–51; Seidel, Wohnungseigentum, pp. 19–36.

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dualistic model that probably developed mainly from registration practice and procedure rather than being based on legislation. Furthermore, a unitary system suited Norway better because it did not require major changes to traditional co-ownership. The established model was left intact when the Law of 1997 was introduced.75

Swedish law recognises an alternative to condominium, known as real estate cooperatives (bostadsra¨tt), which closely resemble their American counterparts. This institution was used in practice even before the initial Swedish legislation was introduced in 1930.76 However, occasional abuse of this unregulated institution by developers who bought real estate and founded real estate cooperative associations (bostadsra¨ttsfo¨rening) with the sole aim of profit maximisation caused economic instability and resulted in economic loss to members of the association concerned. The purpose of the legislation was to improve the financial stability of cooperative associations and to give some kind of security of title to its members. As a result, the legislation prohibited other institutions (apart from real estate cooperative associations) from letting out a house or an apartment to shareholders. The legislation dictated that real estate associations were to be structured as cooperatives with the aim of leasing parts of their estate or building to their members indefinitely. The 1930 legislation was replaced by new legislation in 1971,77 which, among other things, made it possible for a real estate cooperative association to decide if its members should be able to sell their share on more market-oriented conditions than was previously possible. During the 1980s several changes were made, both to the existing legislation and in related legislation concerning areas of importance for the institution.

In 1991 the legislation was replaced by the current Law on Real Estate Cooperatives.78 A Swedish real estate cooperative (bostadsra¨tt) is established for the sole purpose of owning an estate consisting of one or more houses or apartments and to conclude mainly residential leases of these houses or apartments with its members (Law of 1991 Ch. 1 s. 1). The association must be designated as a real estate cooperative and must not include the term ‘company’ (Ch. 9 s. 6). A real estate cooperative is thus established when a house or an apartment in a multi-apartment building is leased to a member for an indefinite period of time (Ch. 1 s. 4). Each individual member of the association

owns a share in the association, and this share must either be acquired from the association or from a previous member (Chs. 4 and 6). A member’s shareholding confers on him/her the right to use a specific house or apartment on the basis of a lease (Ch. 1 s. 3). In order to prevent abuse in this area, Swedish law prohibits institutions other than cooperative associations from leasing houses or apartments to shareholders (Ch. 1 ss. 4 and 8). The Law of 1991 underwent some changes aimed at clarifying the division of responsibilities between the association and its members. However, the main principles laid down in the first law from 1930 are still in force.

As recently as 2009 a new form of condominium was introduced in Sweden, known as privately owned apartments (a¨garla¨genheter), as a consequence to 2004 legislation that made it possible to subdivide real estate in three-dimensional pieces to promote more effective utilisation of land. Three-dimensional real estate units, for instance a¨garla¨- genheter, are regulated through certain pieces of legislation, such as the Land Code (Jordabalken) (1970:994) and Real Property Law (Fastighetsbildningslagen) (1992:1212). The boundaries of a three-dimensional real estate parcel are drawn both horizontally and vertically. Privately owned apartments (a¨gerla¨genheter) are thus three-dimensional apartments in a multi-unit apartment building consisting of several a¨gerla¨- genheter. This new institution has not gained the expected popularity in practice. This is because only newly constructed buildings may be structured as condominiums and rental buildings or real estate cooperatives may not be converted to condominiums. It will therefore take some time before a¨garla¨genheter will become a substantial part of the Swedish condominium market. At the moment there are fewer than 500 a¨garla¨genheter in Sweden. Of the 14,447 newly built apartments completed in 2009, only six were privately owned apartments, while most of them, namely, 7,723, were units in real estate cooperatives (bostadsra¨ttsla¨genheter). The Swedish reporters therefore focus on real estate cooperatives in their answers.

6. Baltic countries

During the Soviet regime, residential premises in the Baltic countries comprised either state-owned flats or flats owned by housing cooperatives. In Estonia, for example, 92.18 per cent of the residential accommodation consisted of state-owned flats, while 7.82 per cent of flats were owned by housing cooperatives, which were allowed to build

multi-storey buildings between 1950 and 1990 mainly to accommodate their workers. In 1991 formerly state-owned flats were privatised and then offered at cheap prices for sale to the tenants. This resulted in a privatisation rate of more than 90 per cent and with it came the realisation that these apartments must be regulated by condominium legislation for them to function properly. The institution is today hampered by the fact that not all the buildings are sold out and that most of the buildings are still interspersed with apartments owned by the local municipality concerned. Cooperatives were preserved as a legal form in Estonia and Latvia but not in Lithuania.

Condominiums in the Baltic countries have the following characteristics: ownership in an individual apartment is connected to a pro rata share in the common property; a manager must be appointed to administer the common property; each apartment in the scheme is recorded on a separate folio in the land register; and each owner is obliged to share in the expenses to maintain the common property but the maintenance of their apartments are their own responsibility.79

During Estonia’s first period of independence (1918–40), the legal system did not recognise private ownership independently from the ownership of the apartment building. However, a person was able to, for example, lease an apartment. During the Soviet regime (1940–91) all land in Estonia belonged to the state. However, even though a person could not become the owner of land, he or she had the right to use an apartment if he or she was a member of a real estate cooperative (elamukooperatiiv).80

The Law on the Principles of Ownership Reform of 1989, which came into operation in 1991, facilitated the privatisation of residential buildings erected during the Soviet period. The Law on the Privatisation of Residential Premises promulgated in 1993 provided that the object of the privatisation was an apartment together with a share in other relevant parts of the building (§ 3). Although apartment ownership was not officially recognised at that time, the privatisation of residential premises caused many of these apartments to be sold as residential units in commerce independently from the land on which they were erected. Later, the land that still belonged to the state was transferred

79Baltic Energy Efficiency Network for the Building Stock Project Results 2007, Berlin Senate Department for Urban Development Section IVC.

80Victorin, ‘Legal framework of user-owned dwellings in the Baltic countries’ (2001), p. 12.

to the owners of residential premises and apartment buildings, usually free of charge, and this eventually led to apartments being registered as independent entities in the land register.81

The first Law on Apartment Ownership came into operation on 23 March 1994.82 Based on the German Wohnungseigentumsgesetz of 1951, it defines apartment ownership as ownership in a physical portion of the building together with a co-ownership share in the land and the common parts of the building (§ 1). As a result of a policy decision that apartment buildings must be maintained and administered by independent management associations (korteriu¨histu), or alternatively through a partnership agreement between the owners,83 the Law of 1994 contained very few provisions on the maintenance and administration of the apartment ownership buildings and was therefore supplemented by the Law on Apartment Associations that entered into force on 3 August 1995. However, it soon became apparent that the establishment of apartment associations to manage schemes was not popular in practice, mainly as a result of the continuing uncertainty of the relationship between existing apartment associations and individual owners of the scheme.84

A second Law on Apartment Ownership came into operation on 1 July 2001. This Law again followed the German WEG and regarded the apartment, together with its undivided share in the common property, as a composite parcel of immovable property governed by the provisions of the Law on Property relating to immovables (§ 1[1]). The most important innovation was the provision that apartment ownership buildings could henceforth in addition to an apartment association be administered and maintained by the community of apartment owners themselves. Once a person becomes an owner in an apartment ownership scheme, he/she automatically becomes part of the apartment ownership community (korteriomanike u¨hisus), which is not a separate legal persona but brings into play a relationship similar to a partnership. The apartment owners may, but are not obliged to,

81Pa¨rna, ‘Development of Apartment Ownership Legislation in Estonia in 1994–2009’ (2009), pp 103–13.

82RT I 1994, 28, 426.

korteriomandiseaduse muutmiseks’ (2008), pp. 39–45.

84Explanatory Memorandum to the Apartment Ownership Act of 2001 that the main problem was that apartment associations feared insolvency as a result of difficulties experienced in collecting contributions from apartment owners.

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establish an apartment association that is a legal person in the form of a non-profit association for the management of the common property. The community of apartment owners or the apartment association, if established, are free to appoint a manager to take care of the maintenance of the building and the administration of the scheme.

At present, the Ministry of Justice is preparing the concept of a third Law on Apartment Ownership, which is intended to solve the questions of the passive legal capacity of the community of apartment owners that has proven to be problematic.