How to create an owners Community legally in Spain?

1. Introduction: the existence of common elements and the Horizontal Property regime preconditions for the creation of communities of property owners

An owners'  community (hereinafter OC) can only exist within the Horizontal Property regime because only in it is permitted the coexistence of different owners in the same building. In Horitzontal Property, each owner has exclusive ownership of the private elements and, at the same time, he/she is a co-owner of the common elements with the other co-owners.

It is in the management of what is common that an OC stem from. 

On the contrary, within the Vertical Property regime, it does not make any sense to create an OC when it is possible. Moreover, it is usually impossible.

Let's see why: in a VP all the real estate products of a building are private, that is to say, all departments are property of a single person -a person or a firm-, obviously, no owner can constitute a community with him/herself (in exceptional cases there can be two or three owners).

As a conclusion of this first section we give examples of private and common elements:

- Private ones such as: dwellings, premises or annexes to the building. 

- Common ones such as: porter's lodge, grounds, terraces, gardens, swimming pools, structures or façades.

2. What is  the horizontal property regime legislation in Catalonia? What are the preconditions to constitute the community of owners? 

While in the rest of Spain the law which establishes the conditions to create an Horitzontal Property is the "Ley de Propiedad Horizontal" (LPH) in Catalonia the exclusive regulation in this matter is the Catalonian Civil Code (hereinafter CCC) . In this article Finques Feliu that is a openminded firm but based in Catalan Territory will focus on the CCC legislation.

CCC Establishes the basis for create a CP in its article 553 section 1. In it, is distinguished between types of elements and specifies when we speak about common elements and when we speak about private elements both are indivisible and that:  

The Horizontal Property legal regime requires the constitution and supposes:

(a) The present or future existence , of one or more owners of the ownership of at least one real estate integrated by private elements and common ones.

b) The determination of the  participation quota in the common elements corresponding to each private element.

c) The configuration of an organization for the exercise of the rights and the fulfillment of the duties of the owners.

How must a new owners' community properly constituted?

Before starting this point, it should be clarified that the power to create an OC depends on the ownership status of the property of each person - whether is a person or a firm -. Thus, only owners can create an OC. On the other hand, a tenant will never be able to do so because he/she has no ownership title. 

Now, you can take note of the steps to create an OP:

a) To register the constitutive title in the Property Registry.

The constitutive title of the Horizontal Property or deed of horizontal division has to be registered in the property registry. In order to achieve the maximum legal security at Finques Feliu we recommend to have the Title Deed as soon as possible. In this sense, we would like to remind you that it is possible to register the Title Deed at the Property Registry before the building construction is completed.

b) To convocate and to celebrate a meeting of owners according to the current legislation.

We explained how to do it in our blog on September 2, 2019 we remember:

"The celebration of the JDP always has to be communicated in a demonstrable way in front of a judge. In case of holding a JDP in a hidden way it would be challengeable. The legitimate parties to challenge are: the owners who were not notified and those who have not seen their requests approved (this is improbable because they would be acknowledging that they were participants in an illegal act and knew it). In case this bad faith behavior is demonstrated, the justice will declare null and void all the decisions adopted during the "hidden" JDP.

The communication has to be made by all possible means. Thus, the hand-delivery of the notice of meeting to the owner is considered to be an irrelevant proof. It should be added that communication by e-mail is also legal "provided that the authenticity of the communication and its content is guaranteed" (article 553 section 21 of the CCC). As the same article states: "The summons, summons and notifications must be sent, at least twenty calendar days in advance, to the address communicated by the owner to the secretary". If it is not possible to be delivered by hand, the notice board or a very visible place must be used to post the summons.

An issue that must be taken into account. At the moment prior to the constitution of the PC there is no President, Secretary or Vice-president: who is empowered to call the constitutive meeting in the absence of these elected charges?

According to Article 553-21 of the CCC: "the meeting request in case of vacancy (...) shall be made by the owners promoting the meeting in accordance with Article 553-20 of the same CCC".   

The data that must be included in the meeting request are:

  - Day, place and time of the JDP.

  - Agenda of the owners' community meeting established by whoever presides over the foundational meeting of the Community.

  - A warning about the value of the absent owners' vote: it counts in favor of the voted proposal (CCC art. 553-24).

Once the meeting is convened and with the owners present it is necessary to:

• To choose the positions of the community: president, property manager, secretary, member.
• To sign the constitutive act that has to be registered in the minutes book so that it is legally binding.
• It is necessary to legalize the book of acts in the corresponding property registry and then to process the Tax Identification Number (NIF) of the community before the corresponding Tax Office as we will explain in detail in point d).

c) To register the community in the Property Register:

To achieve this, stamp the book of acts (available at any bookstore). The procedure is effective in 15 days and the documentation to be attached to make the registration effective is the following:

Book of acts in white

Constitutional act:

• Photocopy of the president's DNI (Spanish Identity Card)
• Photocopy of the deed of the president's or an owner's home
• Request addressed to the registry of the property, duly signed, indicating the registry data of the property, new construction and horizontal ownership.

d) To make the request of the NIF of the community to the Tax Agency.

Print the NIF application form, with the model 036, which will be sent to you at the Tax Agency.
Book of acts stamped at the Land Registry with the constitutional act.
Photocopy of the DNI of the president and of the Administrative Secretary - only in case of having been authorized to make the transaction-.

e) To open an account destined only to deposit the income coming from the ordinary quotations of the community:

In this last step it is clear that a COP always needs to have a budget: to approve it, at least one ordinary annual meeting must be held. On the other hand, the reserve fund must be deposited in a bank account (article 553-6 of the civil code). The procedure of constitution of the Community is recalled in articles 553-6 to 553-9.

3. Why is it so important to constitute the OC?

Because "in case of not constituting it each owner could unilaterally modify elements of the property and affect the whole of the co-owners without having to consult absolutely nothing to anyone" as Api.cat wisely warns.

It is obvious that make modifications without warning of the damage is selfish. This scenario would be lethal for coexistence within the OC. The owners who are harmed by seeing a lack of solidarity which is not punished would want to get revenge. 

However, the certainty is that the law does not make it compulsory to constitute the CP. From Finques Feliu, in view of what we have explained, we always defend that it is better to be protected by the Civil Code of Catalonia than to opt for be not protected by the law. 

Without the OC creation no law - neither the CCC nor the LPH - protects us, therefore, it is not possible to do anything against unilateral and harmful modifications from one owner to the others.

Today we have explained the framework which supports the of the OC birth -the Civil Code of Catalonia- in which regime to do it -Horizontal property-, who cannot do it and the steps to achieve it.  

Finques Feliu: by your side.

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