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Legality of Maintenance Fees for Complex 
Post: #1   PostPosted: Sat Oct 14, 2017 6:22 am Reply with quote
nikcnet
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Nigel

I know that Maintenance Fees - and how they should be shared by owners at a complex - is a well worn topic of discussion for you.

I understand that costs should be shared according to the size of your unit, defined as living area PLUS covered and uncovered balcony / verandah areas. Is this the case ?

I have now been told that UNTIL Title Deeds have been issued, costs can be shared in any way the powers that be see fit.

My understanding of the law is that proportionality ( using my definition of the unit owned ) applies - and not any formula someone decides upon for themselves. Is this correct - and are there any circumstances where the law does not apply ?

This issue is driving us nuts - as we believe we are the victims of an illegally applied 'scheme' of proportionality that ONLY includes living area.

Your help and advice is appreciated.
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Post: #2   PostPosted: Sat Oct 14, 2017 11:37 am Reply with quote
nhowarth
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Hi nikcnet

The law is perfectly clear. The amount you contribute is based on the covered area surrounded by the outer walls of the unit and the covered and uncovered verandas and the covered and uncovered balconies of the unit:

As soon as each owner takes possession of his unit, he has the obligation to pay to the Management Committee or the seller, if a Management Committee has not yet been appointed, the sum of money which is to be prescribed in accordance with these Regulations, which shall represent his share in covering the initial management and administration expenses of the jointly-owned property. In addition, the owners for the time being shall pay to the Management Committee the total sum, which is to be prescribed in accordance with the Law and these Regulations. Each owner shall contribute towards this sum (in) proportion to the area of his unit as is provided by section 38K of the Law as shown on Table B which is attached to these Regulations. Every person who subsequently becomes owner of a unit has the same obligations to contribute towards this sum. This sum shall be used as a consolidated reserve towards the common expenses of the jointly-owned property, including the insurance of the jointly-owned building in accordance with the Law.

The area of a unit consists of the covered area surrounded by the outer walls of the unit and the covered and uncovered verandas and the covered and uncovered balconies of the unit are included therein. Where common walls exist between units or between a unit and a jointly-owned property, the area of these walls shall be distributed equally among the units which have common boundaries or between the unit and the jointly-owned property, as the case may be.

The owners of all the units shall participate in the expenses which are necessary for the insurance, maintenance, repair, restoration and management of the jointly-owned property and for securing the services prescribed by this Part or by the Regulations. The proportion of the share of each owner in the expenses shall be prescribed by the Regulations on the basis of the area of each unit.


Your developer will be able to advise of the area of each unit as he has to supply this information to the Land Registry.

Whether Title Deeds have or have not been issued is irrelevant.

Regards

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Post: #3   PostPosted: Wed Oct 25, 2017 1:55 pm Reply with quote
alan99
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Thanks Nikcnet for bringing up the point.

My developer (also the community manager) has suddenly decided to charge by percentage after for several years charging per bedroom. Individual owners were issued the deeds last year. As far as I know no vote was taken on charging either way.
However they have not changed the arrears owned by some owners for the first several years from number of bedrooms to percent . Those with one bedders are much better off.
So Nigel. Can owners insist on a change on arrears demands. How?

Also , probably a silly question !
Is any lawyer hired by the developer to send out demands duty and legally bound to check with his client if he is making a legal demand. So any previous demands wrongly calculated will by void ? What if a wrongly calculated demand goes to court and is not defended.

Alan
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Post: #4   PostPosted: Wed Oct 25, 2017 3:00 pm Reply with quote
nhowarth
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Hi Alan

Unless you're contract obliges you to use your developer as the 'community manager' (whatever that may be) it is essential that owners take matters into their own hands and establish a Management Committee as required by the law.

If the developer has incorrectly charged arrears, then he should recalculate them - and those with smaller dwellings who have paid will receive a refund and those with larger dwellings will have to pay more. You will need to speak with your developer about this.

I can't say whether a lawyer is bound to check his client is making legal demands - the lawyer may be calculating the demands himself. It's relatively easy to check if the demands are accurate by getting the information used to charge off the Department of Lands & Survey's website. (If you want to send me a copy of the top half of the second page of your Title Deed with all the information about the property I can get this for you).

If you fail to defend any action in court (regardless of the circumstances) the court will award the plaintiff an uncontested judgement in their favour.

Regards,

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Post: #5   PostPosted: Thu Oct 26, 2017 6:32 am Reply with quote
nikcnet
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alan99 wrote:
Thanks Nikcnet for bringing up the point.

My developer (also the community manager) has suddenly decided to charge by percentage after for several years charging per bedroom. Individual owners were issued the deeds last year. As far as I know no vote was taken on charging either way.
However they have not changed the arrears owned by some owners for the first several years from number of bedrooms to percent . Those with one bedders are much better off.
So Nigel. Can owners insist on a change on arrears demands. How?

Also , probably a silly question !
Is any lawyer hired by the developer to send out demands duty and legally bound to check with his client if he is making a legal demand. So any previous demands wrongly calculated will by void ? What if a wrongly calculated demand goes to court and is not defended.

Alan


Alan makes an interesting point.

If a lawyer is involved in the determination of how maintenance fees should be allocated, I would have thought that there is a professional, moral and ethical obligation to ensure that this is legally robust - and not simply what their interpretation of what they think the law should be ?

Picking up on your point Nigel, if an owner is taken to court about alleged non-payment, arrears or other allegations about the conduct of owner obligations, isn't the court obliged to look at what the law prescribes rather than simply find in favour of the party pursuing a claim if that is uncontested? Otherwise, anyone can claim anything and get away with it ?

Also, assuming a defendant does show up in court, I seem to recall at several PICAS meetings that Stelios, our respected lawyer from Nicosia, saying that non-compliance with an unlawful demand is a robust defence that the court will recognise and accept?.
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Post: #6   PostPosted: Thu Oct 26, 2017 7:45 am Reply with quote
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'.... isn't the court obliged to look at what the law prescribes rather than simply find in favour of the party pursuing a claim if that is uncontested? .... '

Precisely, the court determines based upon the law, not what someone else has decided to do.

As long as you are satisfied that you have fulfilled your legal obligations and have paid according to your apartment size as prescribed by the jointly - owned property law, then that is sufficient. let the other party bleat on about it.

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Post: #7   PostPosted: Thu Oct 26, 2017 12:01 pm Reply with quote
nhowarth
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nikcnet wrote:
Also, assuming a defendant does show up in court, I seem to recall at several PICAS meetings that Stelios, our respected lawyer from Nicosia, saying that non-compliance with an unlawful demand is a robust defence that the court will recognise and accept?.


Yes - if the defendant mounts a defense, the court cannot issue an uncontested judgement. It will consider the arguments put to it by the plaintiff and the defendant and make a judgement accordingly.

(An uncontested judgement can only be awarded in cases where the defendant fails to defend the action.)

Regards,

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Post: #8   PostPosted: Wed Dec 13, 2017 12:29 pm Reply with quote
nikcnet
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Hi Nigel

An update on the continuing saga of maintenance fees at our complex.

Our experience may resonate with other members of the Forum. Your and their observations on what we face may be helpful in promoting a resolution of what is effectively a running / bleeding sore on what should be enjoyable living in Cyprus.

Having consulted four lawyers - including the respected Stelios from PICAS days - we know and understand that maintenance costs should be shared according to the size of the unit - and that includes all covered / uncovered balconies and verandas.

The problem we face as owners is that the external company responsible for maintainingour complex has decided to only include living area and external covered area in the way they have calculated costs. This is with the approval of the Committee who have ignored arguments to the contrary.

Perhaps the unkindest cut of all is that the firm of solicitors that comes as part of the 'package' with the maintenance company has endorsed this way of working. They have their (singular) version of what the law means - as opposed to what other lawyers (correctly) advise.

In practical terms, we - and many others - are being overcharged for our share of costs. Equally, those with vast areas of uncovered balcony / veranda are required to pay less. I know that life can be unfair and sometimes a right bitch, but the unfairness of treatment really grates.

In an effort to resolve matters, we have previously advised the maintenace company to speak with our lawyers. They have completely ignored this reasonable request and their legal associates have sent us a letter demanding alleged overdue fees and threatening legal action if we don't comply.

This latest act of bullying is compounded by the lawyers adding an extra 100 Euros plus registered letter cost for the privilege of receiving this demand. I can understand legal costs becoming liable in the event of an adverse judgement that's gone through due process - but this is simply an example of someone trying to screw us !

We believe that we are reasonable people and accept that a complex has to be maintained - no problem with paying for that, but fairly and legally.

We have continued to pay what was the same (self-managed) fee before the external maintenance company was appointed nearly two years ago.

I know from our days at PICAS that maintenance was an issue that caused tremendous grief and stress for people. It seems that nothing much has changed - and it really undermines the quality of life. I think this is less about money and more about people trying to exercise power and control over others.

We await the next chapter in this unfolding saga - in the meantime, Happy Christmas to all and I hope that goodwill may yet surface in 2018 !!!!
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Post: #9   PostPosted: Wed Dec 13, 2017 3:46 pm Reply with quote
nhowarth
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nikcnet wrote:
The problem we face as owners is that the external company responsible for maintaining our complex has decided to only include living area and external covered area in the way they have calculated costs. This is with the approval of the Committee who have ignored arguments to the contrary.


The Committee does not have the authority to do this. If the method of calculating contributions to the Management Committee is to be changed, new Regulations have to be approved with the agreement of at least 75% of the joint ownership - and the 'new' regulations lodged at the Land Registry.

If your committee understands English, I suggest you give them a copy of
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Regards,

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Post: #10   PostPosted: Wed Dec 13, 2017 6:56 pm Reply with quote
nikcnet
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A further thought about this ....

What is the situation regarding owners who have been overcharged and paid the money demanded of them? Are they entitled to a refund ?
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Post: #11   PostPosted: Wed Dec 13, 2017 9:52 pm Reply with quote
nhowarth
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As I replied to alan earlier "If the developer has incorrectly charged arrears, then he should recalculate them - and those with smaller dwellings who have paid will receive a refund and those with larger dwellings will have to pay more. You will need to speak with your developer about this."

Regards

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Post: #12   PostPosted: Thu Dec 14, 2017 5:35 am Reply with quote
Bobbeer
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If title deeds have not been issued isn't the developer the registered owner of the whole estate?

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Bob
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Post: #13   PostPosted: Thu Dec 14, 2017 7:32 am Reply with quote
nhowarth
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Bobbeer wrote:
If title deeds have not been issued isn't the developer the registered owner of the whole estate?


Yes. Are you trying to say those who have yet to receive their Title Deeds are not considered to be owners and cannot undertake the management of the complex?

If that were the case then only the developer would have to pay 100% of the communal fees as he owns 100% of the development.

Regards,

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Post: #14   PostPosted: Thu Dec 14, 2017 10:40 am Reply with quote
Bobbeer
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nhowarth wrote:
Bobbeer wrote:
If title deeds have not been issued isn't the developer the registered owner of the whole estate?


Yes. Are you trying to say those who have yet to receive their Title Deeds are not considered to be owners and cannot undertake the management of the complex?


I'm not trying to say anything, I was asking a question, which you have answered with a straightforward "Yes".

Quote:
If that were the case then only the developer would have to pay 100% of the communal fees as he owns 100% of the development.

Regards,

In our dreams...

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Post: #15   PostPosted: Sun Jan 28, 2018 8:54 pm Reply with quote
snoutintrough
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Hi Nigel,

If a complex introduced a maintenance fees structure which is not based on the square feet approach and all the paying apartments, which is just short of 75% of the total number of apartments, have paid their fees regularly for over five years without a single query on the payment structure. Therefore, in the eyes of the law, as this as being going on for a long period, would this be automatically accepted and could be registered as the official payment structure for the complex.

I should say, some owners never completed their purchase and these apartments remain in limbo and some owners just walked away so we could never reach the 75% of the total number of apartments for any decision but all those that pay have never queried or challenged the current payment structure.

Regards

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Post: #16   PostPosted: Sun Jan 28, 2018 9:41 pm Reply with quote
nhowarth
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snoutintrough wrote:
Therefore, in the eyes of the law, as this as being going on for a long period, would this be automatically accepted and could be registered as the official payment structure for the complex.


No.

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Post: #17   PostPosted: Mon Jan 29, 2018 9:14 pm Reply with quote
linglieglen
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I applaud your tenacity nickcnet in standing up for your rights. Perhaps you should be naming the Maintenance company and their lawyers, so that other committes can steer clear of them.
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Post: #18   PostPosted: Tue Jan 30, 2018 12:35 pm Reply with quote
snoutintrough
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Thanks Nigel.

It would be interesting to know how many complexes follow the apartment size or a standard communal fee on the number of bedrooms approach and, if the latter, have they submitted this financial structure to the local authority?

Cheers,

Snoutintrough
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Post: #19   PostPosted: Tue Jan 30, 2018 1:40 pm Reply with quote
nhowarth
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Hi Snoutintrough

A few thousand people have read my article and I've received several emails on the subject. I guess that most committees are running things correctly.

Cheers,

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Management Committee 
Post: #20   PostPosted: Sat Feb 10, 2018 9:46 pm Reply with quote
neil62
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Dear Nigel..

We have not had a management company appointed since we took ownership of our apartment in 2013, I have tried over the years to muster support from the other owners i am in contact with but to date we have not manage to put something together, a small number of Cypriot owners did put a committee together but it was very short lived, the complex is now in complete disrepair and i have been advised that a large number of apartments on the complex are occupied by gypies, is there any legal responsibility on owners to pay for maintenance cost and management of the complex and if so is there a legal approach to achieving this any help would be much appreciated as all of our investments are being destroyed

Regards


Freddie
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Legality of Maintenance Fees for Complex 
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