On 10 January 2022, the Law No. 8/2022 revising the Horizontal Property regime was published, amending the Civil Code, the Decree-Law No. 268/94, of 25 October 1994 and the Notary’s Code, with the purpose of introducing mechanisms to ease the coexistence in Condominiums.
This legal statute enters into force 90 days after its publication, i.e., on 10 April 2022, except for the amendment regarding the representation of the condominium in court, which came into force on 11 January 2022.
This Law begins by introducing an amendment to the possibility of MODIFYING THE HORIZONTAL PROPERTY TITLE DEED AS TO COMMON PARTS. The rule is that the title deed to the horizontal property can only be changed by agreement of all the condominium members. However, the new law sets forth that the lack of agreement can be surpassed in court whenever (i) the condominium members who do not agree with the amendment represent less than 1/10 of the invested capital (i.e., 100 per thousand, since the value of each unit is usually represented by per mille); and (ii) the amendments in question do not change the conditions of use, the relative value or the purpose for which the units are intended.
In respect of the RESPONSIBILITY FOR THE PAYMENT OF COMMON EXPENSES AND COMMON CHARGES due by condominium members selling and acquiring building units, the new framework clarifies that the expenses necessary for the conservation and use of the common parts of the building and related to the payment of services of common interest are of the responsibility of the condominium members who owned the units at the time of the respective resolutions, being paid in proportion to the value of the respective units (i.e., according to the respective per mille).
Moreover, it was approved that the expenses related to the payment of services of common interest may be borne by the condominium members in equal parts or in the proportion to the respective use, if approved, without opposition, as a provision of the regulation, by a majority of the condominium members representing the majority of the total value of the building, insofar the criteria that determine its allocation are duly specified and justified.
Regarding the COMMON PARTS FOR EXCLUSIVE USE, the law clarifies that if there is an area for the exclusive use of any unit and this affects the state of conservation or the use of the other common parts of the building, the condominium member to whom the use is assigned exclusively, only bears the value of the respective repair expenses pro rata to the value of its unit, unless the fact is attributable to such condominium.
The Civil Code now includes the definition of “indispensable and urgent repairs” as “(…) the repairs necessary for the elimination, in a short term, of defects or pathologies existing in the common parts that may, at any time, cause or aggravate damage to the building or set of buildings, or to assets, or that may jeopardize the safety of persons.”
Without prejudice to the general rule that the CONDOMINIUM ORDINARY GENERAL MEETING is held in the first fortnight of January, the legal statute sets forth the exception of the general meeting being held in the first quarter of each year, insofar that this possibility is provided for in the condominium regulation or results from resolution approved by majority of the Condominium General Meeting.
The CALL NOTICE OF CONDOMINIUM GENERAL MEETINGS can now be sent by email to the condominium members who express this wish at a previous General Meeting, and this wish must be recorded in the minutes with the indication of the respective email address. The condominium member must send, through the same means, a receipt notice of the respective call notice e-mail.
With regard to the SECOND DATE OF THE CONDOMINIUM GENERAL MEETING, the Law establishes a repeated practice, but until now much contested by the Courts as contrary to the law. So, it is now foreseen that, if the conditions are met to guarantee the presence, on the same day, of the condominium members representing a quarter of the total value of the building, the call can be made for thirty minutes later, at the same location.
Likewise, the Law clarifies another important issue with contradictory case law: the VALUE OF SILENCE OF ABSENT CONDOMINIUM MEMBERS, setting forth that the silence of the condominium members is deemed as approval of the resolution that has been communicated under the terms provided for in the law.
The following DUTIES OF THE CONDOMINIUM MANAGER were added, namely:
- i. To verify the existence of the common reserve fund;
- ii. To demand from the condominium members their share of the approved expenses, including the legal interest due and the pecuniary penalties established by the condominium regulations or by resolution of the General Meeting;
- iii. To enforce the resolutions of the General Meeting that have not been challenged, within a maximum period of 15 business days, or within the period established therein, except in situations of duly justified impossibility;
- iv. To inform, in writing or by email, the condominium members whenever a condominium member is summoned or notified within the scope of a judicial proceedings, arbitration proceedings, payment order proceeding, administrative offense proceedings or administrative proceedings;
- v. To inform, at least every six months, in writing or by e-mail, the condominium members on the developments of any judicial proceedings, arbitration proceedings, payment order proceedings, administrative offense proceedings or administrative proceedings, except for proceedings subject to judicial secrecy or proceedings which information must be kept confidential for another reason;
- vi. To issue, within a maximum period of 10 days, the statement of debt of the condominium member, whenever it is requested by the same, namely for the purposes of transfer of the unit;
- vii. To intervene in all urgent situations that require intervention, immediately convening an extraordinary general meeting of the condominium members to ratify its act.
- viii. In the event of failure to comply of the condominium members, the Condominium Manager must take legal action in order to recover the amounts of the approved contributions, plus late payment interest at the legal rate and monetary penalties, provided that they are approved by the General Meeting of Condominium Members or by Regulation. However, the amount of penalties applicable each year will never exceed a quarter of the annual taxable income of the offender’s unit. The filing of the lawsuit must take place within 90 days after the verification of the first breach, otherwise the Condominium Manager will be held responsible, provided that the amount owed is equal to or greater than the value of the Social Support Index (IAS) for the year civil in question (for 2022, the IAS is EUR 443.20).
It has also become the responsibility of the Condominium Manager, under penalty of civil (or even criminal) liability, that, in the event of the need to carry out extraordinary conservation works or works that constitute innovation, the Condominium Manager must present three previous budgets for their execution, provided that the condominium regulations do not provide otherwise.
Additionally, the law sets forth that the condominium members’ representation is always carried out by the Condominium Manager, who may act in court in the exercise of his/her duties, as a representative of the universality of condominium members or when expressly mandated by the General Meeting of Condominium Members, with the duty of filing lawsuits or presenting defense on behalf of same.
Finally, a new rule was added to the Civil Code imposing a NEW MANDATORY INSTRUCTORY DOCUMENT IN THE PUBLIC DEEDS OF PURCHASE AND SALE (or authenticated private documents) of autonomous units, namely, the written statement issued by the condominium manager, which includes the amount of all condominium charges in force in relation to the respective unit, specifying their nature, respective amounts and payment terms, as well as existing debts, their nature, amounts, dates of creation and maturity. The law also clarifies that liability for existing debts is assessed according to the time at which the debt should have been settled, unless the purchaser expressly declares that it waives the statement to be issued by the condominium manager. It should be noted that the lack of the aforementioned document (or statement) may lead to a provisional land registry situation due to doubts on the acquisition, given that this matter has not yet been properly settled with the Land Registry Offices.
With regard to Decree-Law no. 268/94, in its current wording, and following the evolution on the communications means resulting from the pandemic situation of COVID-19, a new article was added providing for the possibility of holding the General MEETING THROUGH TELEMATIC MEANS, preferably by videoconference. If any of the condominium members is not reasonably able to participate in the condominium general meeting by telematic means and has communicated this impossibility to the condominium manager, it is incumbent upon the latter to ensure that the necessary means are available, under penalty of the general meeting could not be held through those means.
It was clarified that the MINUTES OF THE GENERAL MEETING that decides on the amount of contributions to be paid to the condominium and that mentions the annual amount to be paid by each condominium member and the maturity date of the respective obligations, constitutes an enforceable title against the condominium member, including, for this purpose, the interest on late payment at the legal rate and the pecuniary penalties approved by the General Meeting or provided for in the Regulation.
In order to accelerate the judicial collection procedure, it is foreseen that the relevant moment for the effectiveness of the resolutions will be the approval of the minutes that contain them, establishing that the signature of the condominium members will not be a factor for the deliberations to become effective.
The opportunity was taken to clarify the content of the minutes of the condominium members general meetings and to add as permissible ways to proceed with the respective signature, the qualified electronic signature or the statement of the condominium member, sent by email, to the electronic address of the condominium manager, stating the agreement with the content of the minutes that have been sent through the same means, statement which must be attached, as an annex, to the original minutes.
A SPECIAL DUTY OF INFORMATION FOR CONDOMINIUM MEMBERS is created, similar to the duty already imposed by many Condominium Regulations. Therefore, the unit owners must inform the condominium manager of their tax number, address, telephone contact details and e-mail address and update such information whenever they are subject to change.
On the other hand, it is also established that the transfer of units must be communicated to the condominium manager by the transferor condominium member, by registered mail sent within a maximum period of 15 days from the said transfer, and that this information must contain the full name and the tax identification number of the new owner, under penalty of the transferor condominium member being responsible for the value of the expenses inherent to the identification of the new owner and for the charges resulting from the late payment of the charges due after the transfer.
The obligation to have a total COMMON RESERVE FUND to cover the maintenance costs of the building was created. If used, the condominium members have a maximum period of 12 months from the resolution to ensure the payment of the extraordinary contribution to restore the used amount.
These changes seem to be in line with good market practices and have long been necessary.
Ana Sofia Catarino
Maria Francisca Abreu
Real Estate, Urban Planning, Construction and Tourism
TFRA will update the information in this document whenever deemed necessary.
We draw your attention to the fact that the information contained in this document is of a generic nature and, therefore, does not exempt you from analyzing the specific case and consulting the legislation in force at any given time.