Экзамен зачет учебный год 2023 / European Condominium Law

are in accordance with the intended purpose (destination) of the scheme. In Croatia, only restrictions between spouses and parent and child are registrable and thus enforceable. Apart from protecting the freedom of contract, Spanish law contains a prohibition against clauses in a contract that are against the law, social morality and the public order (CC art. 1255). A clause granting the community of owners the absolute competence to veto certain purchasers from buying into the condominium is regarded as discriminatory and thus invalid.

On the other hand, various jurisdictions accept a restriction in the constitutive deed or the by-laws of a particular scheme on the power of disposal to the effect that the management body must consent to the transfer.65 However, such restrictions are usually subject to certain qualifications. For example, under Danish law such a refusal is valid only if it is based on an impartial and objective ground and aimed at protecting the interests of the condominium community as a whole. As mentioned above, Irish law also accepts that the terms of the lease may provide that the OMC is entitled to refuse consent to any assignment of the lease; however, the Landlord and Tenant (Amendment) Act 1980 stipulates that such consent may not be withheld unreasonably. The Norwegian Law on Unit Ownership of 1997 accepts that the bylaws of a scheme may validly subject the acquisition of a unit by the purchaser to approval by the management body. However, such approval cannot be refused without good reason,66 and in particular cannot be used so as to circumvent the ban on discrimination. The Swedish real cooperative institution (bostadsra¨tt) is open to any individual unless there is a particular reason why they should not be admitted. Two of the listed reasons that are unacceptable are that the prospective entrant’s income is not of a certain level67 and that the city council did not approve that person’s entry into the scheme. Thus it is readily evident that, in most jurisdictions, unfair restrictions on membership of a condominium scheme are heavily guarded against.

(b) This Case concerns the validity of a provision in the by-laws that contains an absolute prohibition on the letting of apartments in the scheme. This provision is challenged by most reporters on the ground that it restricts the entitlement of an owner to dispose freely of his or her assets, a fundamental principle of property law.68 Thus, in one

65 Danish, German, Irish, Norwegian, Scots, South African and Spanish reports.

68 Austrian, Belgian, Catalan, Italian, Estonian and Polish reports.

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extreme instance, the French Court of Appeal held that a clause in the by-laws authorising the letting of furnished apartments only in exceptional cases, and only for limited periods of time, was invalid.

However, the primary objection to this clause relates to the absolute nature of the prohibition.69 In actual fact it is widely appreciated that certain restrictions on letting of apartments may be necessary to promote harmony within condominium schemes.70 Thus, in Belgium bylaws may contain restrictions on the level of use or destination of rented out apartments. Similarly, a Slovenian commentator remarked that a ban on letting units for very short periods of time to ensure that the apartment would not be exploited as a holiday home would be acceptable. In Germany, the constitutive agreement can set up a rule requiring the approval of the general meeting or the manager for letting apartments. However, such approval can be refused, only for a compelling reason. In Dutch practice, it is accepted that a by-law that makes the approval of the general meeting a prerequisite of letting apartments, or a by-law prohibiting apartments from being rented out to certain classes of persons, such as students, is permissible. Under the Swedish Law on Real Estate Cooperatives a member is allowed to let an apartment if he or she has a valid reason for doing so. For instance, if Maria wants to study abroad or in another city for a limited time she would be entitled to rent out her apartment.

(c) Most jurisdictions would deny Benjamin a right of pre-emption (first refusal) over Maria’s flat,71 unless of course this was agreed contractually between the parties,72 or was expressly included in the constitutive deed or by-laws of the particular scheme.73 In Croatia, the duration of a right of pre-emption contained in the constitutive agreement is limited to a maximum of five years from the date of the initial deed.74 Note however that the Polish report and a decision of the French Cour de Cassation regard as null and void a condominium by-law that grants a right of pre-emption to owners whenever an apartment is offered for sale.

69Danish, English, French, Greek, Dutch, Slovenian, South African and Spanish reports.

70English, French, German, Norwegian, Slovenian and Dutch reports.

71This right is expressly not allowed under Catalan, English and Portuguese condominium legislation.

72Catalan, English, Estonian, German, Greek, Irish, Dutch and Polish reports.

73Danish, Italian, Norwegian, Portuguese, South African and Spanish reports.

74If the right of first refusal was registered in the land register, or was otherwise known to Anne, the sale is voidable at the instance of Benjamin within six months from the date on which Benjamin learned of the sale to Anne.

Slovenia is the only jurisdiction that expressly provides for a right of first refusal in favour of neighbouring apartment owners, although the recognition of such a right is dependent on the size of the condominium scheme. If a scheme consists of two or more apartment owners and a maximum of five individual units, Benjamin has a statutory right of pre-emption under the Slovenian Property Code. This gives Benjamin the right to be offered the apartment under the same conditions as Anne. If his right is infringed, he may sue for annulment of the contract between Maria and Anne. This particular report also mentions that if the title to the apartments is based upon co-ownership shares, Benjamin would have a statutory right of pre-emption on the basis of the Property Code, which grants a right of pre-emption to every co-owner irrespective of the size of the building.75 The French and Spanish reports note that if Benjamin were a tenant and not a neighbouring owner of the unit, he would have a right of pre-emption.

Descriptive formants

(a)A prohibition against discrimination is generally embedded in the Constitutions of the various jurisdictions76 by virtue of article 14 of the European Convention on Human Rights77 and the acceptance of this principle within the case law of EU Members States.78 Furthermore the principle of non-discrimination is enshrined in national legislation,79 and in two instances in the condominium legislation itself.80 The right

of free disposal of units is embedded in the Civil Codes of the countries concerned, their Condominium Laws or in model by-laws such as the English CCS.

(b)The descriptive formants regulating the renting out of units comprise the various Civil Codes, national case law, Dutch practice and the Swedish Law on Real Estate Cooperatives.

(c)The descriptive formants include French and Spanish case law and the Slovenian Property Code.

75Estonian report.

76Catalan, Estonian, Dutch, Polish, Portuguese, Slovenian, South African and Spanish

79See, for example, the Belgian Law on the Combating of Discrimination, the Danish Law on the Ban on Discrimination, the Dutch General Law on Equal Treatment, the Croatian Law against Discrimination and the United Kingdom Equality Act.

80Norwegian Law on Owned Units of 1997 and the Swedish Law on Housing Cooperatives.

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Metalegal formants

(a) General

The Croatian reporters state that due to the developments after World War II, private ownership was severely restricted, and additional restrictions on selling would have been highly unorthodox in an already restrictive legal environment. Additionally, the social equality promoted as a socialist value and the allocation of property during the socialist regime was such that there was little room for the creation of closed groups or neighbourhoods supported by restraints on alienation or even on renting. They point out that the cultural environment today has not changed in that respect, so such restrictions (even if in accordance with anti-discrimination laws) would be considered unusual.

(b) Restrictions on sale of apartments

The aim of imposing title conditions restricting an owner’s power of disposal in the by-laws or in the form of real burdens in the constitutive deeds of condominiums is, in a broad sense, aimed at controlling the demographic constitution of a particular condominium. A condominium must accommodate as far as possible a homogeneous mix of residents sharing the same lifestyle, sentiments and practices and must avoid housing residents who cannot afford to pay their condominium assessments or who are perceived to be future troublemakers.81 The ultimate aim is to achieve harmony in an intensified, diverse community where the objects of ownership, namely, the individual units, are physically interdependent.82 However, this community-sensitive approach must be harmonised with the constitutional ban on every kind of discrimination and the individualistic idea that the owner of a condominium unit has all the rights and privileges that the owner of a single house has, including the entitlement to freely dispose of his or her unit.83 Some jurisdictions seem to accept that certain governance organs of the condominium, such as the executive council or the general meeting, can act as gatekeepers regulating entry into the condominium community. It is, however, left to the courts to decide

81Dutch, South African and Spanish reports. However, the Portuguese reporter observes that Portuguese legislation never intended to protect the social and financial security of the scheme through imposing limits on owners’ freedom of alienation. The identity of the buyer is determined through the operation of market forces at the moment

whether the content of the by-laws is reasonable and nondiscriminatory,84 and whether or not any refusal to allow entry into a scheme is unreasonable, unjust or inequitable.85 The German report mentions that requiring approval is widely considered to be mainly a hindering factor in the transfer of units because the approval also has to be notarised. The German legislator, therefore, in 2007, introduced the possibility for unit owners to suspend any existing approval clause in their constitution by majority decision.

(c) Restrictions on letting of apartments

Given that restrictions on letting of condominium units are a less serious inroad into an owner’s freedom of disposal, it would seem sensible that the formulation of such restrictions in the by-laws are left to the general meeting of a particular condominium. There is widespread consensus that an absolute prohibition on letting of apartments out would be too great an infringement of an owner’s freedom of disposal.86 However, a prohibition of certain kinds of letting of apartments is generally accepted as valid on condition that the restriction is compatible with the characteristics of a particular scheme. Thus, a prohibition on holiday lettings or lettings for less than a week may be acceptable so as to prevent an incessant inflow of potentially disruptive residents into an ordinary residential condominium.87 By contrast, such a restriction on letting out units would obviously be incompatible with the needs of holiday or resort condominiums.88 Similarly, a condition preventing apartments being rented out to families with young children may well be compatible with a scheme for elderly persons, whereas such a restriction would be unacceptable in ordinary condominiums.89 However, if any restrictions adopted by a majority of the owners cause significant economic or personal prejudice to any one individual owner, any such owner could challenge the restriction in court. Thus, in a situation where an owner has a valid

84A by-law that prohibits the sale of a garage or a separate room to a person who is not a scheme member in a middle-class residential building was accepted as valid in French case law. See also the Spanish report.

85Danish, Irish and Dutch reports.

86Danish, French, Portuguese, South African and Spanish reports.

87English, Portuguese and Croatian reports.

88The German report proposes the introduction of a ‘lump sum’ payment by each owner for each move in and out of tourist apartments by tenants.

89French, South African and Spanish reports.

scheme prohibiting the renting out of apartments would be void on the basis that it inhibits the real right of free disposal.

However, the Austrian Civil Code contains an exception to the invalidity of a prohibition on the alienation (and mortgaging) of any property including an apartment (§ 364c). It stipulates that such a prohibition will have external effect if the contract in question is concluded between close relatives94 and is registered in the land register. Failing this, an infringement will only result in a claim in damages against the infringer. Establishing a ‘real’ restriction on alienation and mortgaging for the benefit of the community of owners or for the benefit of non-related apartment owners is not possible.

In one specific scenario apartment owners can (indirectly) restrict the letting of an apartment, namely, if the letting causes a substantial change of the intended use of the apartment (see Case 4). For instance, if a residential unit is let to a person who intends to open and run a bar there, the other apartment owners can challenge the change of use by filing a lawsuit against the relevant sectional owner (CC § 523 and Law on Apartment Ownership § 16 par. 2).

Descriptive formants

The right to free contractual disposal of property is deeply entrenched in the Austrian law of contract. The two restrictions on free disposal of apartment ownership units mentioned above offer rare exceptions to this principle.

Belgium

Operative rules

(a) A clause prohibiting sales of apartments in the building to lesbians is invalid under the provisions of the law combating certain forms of Discrimination of 2007. This Law prohibits discrimination on certain grounds including sexual orientation (art. 5 § 1) and renders restrictions that contravene this law null and void (art. 15).95 Discrimination on the grounds of sexual orientation may also fall foul of arts. 10 and 11 of the Belgian Constitution.

94Close relatives include spouses, parents and children and adopted or foster children or their spouses.

95Timmermans, Handboek Appartementsrecht (2008), no. 230.

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A clause which states that the sale of an apartment must be approved by the management body constitutes a restriction to the right of any owner to freely dispose of his unit and is not permitted under Belgian condominium law. Indeed, any clause which restricts a justified public interest, such as the right of disposition of an owner, is invalid.96 The rest of the sale agreement will, however, still be valid and the management body will not be entitled to refuse Anne entry into the scheme.

(b)A clause in the by-laws of the scheme (‘reglement van mede-eigendom/ re`glement de coproprie´te´’) containing a partial or even general prohibition

on renting out an apartment is, according to prevailing opinion, not allowed in Belgian condominium by-laws.97 It is also impermissible to

make renting out dependent upon the consent of the general meeting.98 The by-laws can only contain certain functional restrictions to

the right to let apartments, such as restrictions on the level of use or

destination of the apartment, or restrictions imposed on any owner or user of the apartment.99 Apparently, the opposite is possible: the by-laws

can impose limitations upon the owner to let his or her apartment, in order to ensure a uniform and rational administration.100

(c)There is no statutory or (in this case) contractual provision granting a right of pre-emption in favour of Benjamin in respect of other owners’ units.

Descriptive formants

The protection against discriminatory clauses in deeds of subdivision or the by-laws of the scheme is contained in the Law combating Discrimination and the Belgian Constitution. Belgian law does not have any statutory provisions limiting an owner’s right to sell or rent out his or her apartment. A minority of commentators holds the view that restrictions on the renting out of apartment are valid in order to avoid disruption of the harmony in a scheme.

Metalegal formants

Under articles 10 and 11 of the Belgian Constitution, the Constitutional Court is competent to apply the constitutional principles of equality and non-discrimination. It may invalidate a law on these grounds

96Snaet, ‘De rechten en plichten ten opzichte van de private delen’ (1999), p. 70. The reluctance is due to the reaction of the legislator against the ‘mainmorte’.

100 Ibid., no. 1495; Comp. Trib. Eupen 25 October 1999, T. App. 2000, no. 152.