Purchasing a Condo: The Declaration of Co-Ownership

Why is each condo building’s Declaration of Co-Ownership such an essential document? Its many pages are a treasure trove of information for the broker, buyer, and notary.

It’s important that you, as a buyer, read this document before you decide to purchase a condo. You should likewise ask your broker about any points you’re unclear about.

What’s a Declaration of Co-Ownership?

More specifically, it’s a legal document drawn up by a notary at the moment the co-ownership is constituted. It lays out the co-owners’ rights and obligations, the distribution of charges, and the building management rules.

It’s comprised of three main parts:

The constituting act of co-ownership: It describes the building’s division between private portions (condo units), common portions (lobby, elevator, swimming pool, parking, etc.), and common portions with restricted use (parking, storage lockers, balconies, etc.). It establishes each unit’s contribution to the building’s condo fees. It likewise defines each unit’s relative value and the respective powers and duties of the board of directors and general assembly of co-owners.
The building’s bylaws: It sets out, namely, the condo building’s rules, such as the use of common areas, restrictions on pets, rental rules (a prohibition on short-term rentals, for example), and the co-owners’ obligations. This section also includes the rules governing the operation and administration of the co-ownership (composition of the board of directors, etc.).
A description of the fractions: This section designates the private and common portions of the building.

Is This the Right Condo Building for You?

By stipulating what is and isn’t allowed, the Declaration of Co-Ownership lets buyers know what to expect once they decide to live in the building. For example, if you have a pet, plan to rent out your unit on a short-term basis, or want to set up a barbecue on your balcony, make sure you read the rules beforehand.

The Notary’s Role During the Transaction

Did you know that property transactions involving condos require more work from notaries than for single-family homes?

One reason is that they’re responsible for reviewing the building’s Declaration of Co-Ownership! The notary can inform you of any specific issues they’ve noticed and advise you (while remaining impartial) before you sign the deed of sale.

In addition to reading the Declaration of Co-Ownership, the notary will also send the syndicate of co-owners a questionnaire. This lets them know

whether there are any ongoing legal proceedings against the syndicate of co-owners;
the amount accumulated in the contingency fund;
whether the syndicate has insurance;
of any upcoming special contributions;
whether the unit’s seller has taken any action that is in violation of the Declaration of Co-Ownership and that could have repercussions on the buyer;
whether there is actually a parking space or storage locker as stated by the seller;
the exact condo fee amount for the unit being sold.

Understanding Condo Fees

Condo fees (also known as co-ownership fees) are sums of money that each co-owner must pay monthly to cover the building’s common expenses. Among other costs, these fees pay for

common area maintenance (hallways, elevators, parking lots, roof, green spaces, etc.);
necessary building repairs and renovations;
insurance for common areas;
management and administration costs (accounting, etc.);
contributions to the contingency fund, a reserve held for major long-term repairs.

Condo fees vary based on several factors, such as the unit’s size, the building’s age, and what services are included (swimming pool, gym, security, etc.).

As a General Rule

The owner of the smallest unit pays less, while the owner of the largest unit pays more.

What Happens if the Notary Detects Inconsistencies?

Since at this stage, the buyer has already signed the promise to purchase, what recourse is available to them? If, after reviewing the Declaration of Co-Ownership or the questionnaire, the notary spots any problems (like an insufficient contingency fund) that cause the buyer to reconsider their decision to purchase the unit, the buyer can request that the promise to purchase be cancelled (under certain conditions and within legal limits).

What if the Seller Leaves with Outstanding Sums?

Whether it’s regarding municipal and school taxes or unpaid condo fees, the notary will ensure these payments are made during the transaction process to guarantee that the seller transfers a clear title deed to the buyer.

“If the seller has agreed to sell a property with all costs settled, yet is three months’ behind on their condo fees and owes the municipality overdue taxes, it isn’t up to the buyer to cover these costs. As a notary, we will simply deduct this money from the sale price and return it directly to the parties concerned, either the syndicate of co-owners or the municipality.”

Me Aubin-Brushey

Notary