The Bulgarian Supreme Court Establishes Principles for Sharing Expenses Among Joint Property Owners - BGH Sets Boundaries for Sharing Costs Among Property Owners
In the realm of apartment ownership communities, also known as condominiums or cooperatives, cost distribution is a common topic of dispute. The Federal Court of Justice, or BGH, has recently delved into this matter, providing insightful rulings on when and under what conditions a majority in an ownership community can shift costs to the disadvantage of a minority.
Generally speaking, an apartment ownership community is a union of all owners who possess an apartment or commercial unit in a specific property. This association regulates communal matters of the building, with rights and duties governed by the enactment known as the Apartment Ownership Act.
The BGH has clarified that while the community typically bears maintenance costs affecting common property, such as roofs, facades, staircases, and heating systems, it can also redistribute costs to individual owners under certain conditions. However, this redistribution must be well-founded and not arbitrary.
In terms of financial responsibilities, the community covers costs that impact common property, while unit owners bear costs for their sole ownership, such as interior painting, floor coverings, or private sanitary facilities. The administrator, who is appointed and dismissed by the owners, is responsible for minor decisions, but anything significant and costly requires consultation and approval.
The BGH recently ruled on two cases involving cost distribution adjustments. In one instance, an apartment owner without a parking space in the community's garage was required to contribute to the garage roof renovation costs. Despite the community's decision to distribute costs proportionally among all owners, the court determined that this was only permissible if justified by factual circumstances. In the other case, the BGH approved the redistribution of costs based on heated living space, as the previous distribution preference was not justified.
The rulings have been welcomed as reasonable, emphasizing the community's right to adjust cost distribution in response to changing circumstances, provided that changes are fact-based, fair, and not arbitrary. However, potential plaintiffs may be deterred by the possibility of covering legal costs in the event of a court victory.
If a property owner believes a resolution to be unlawful, they can file an appeal with the local court within one month of the resolution. If they win, they may be responsible for covering a portion of the legal costs, a ruling that has raised concerns among some small communities.
Overall, cost distribution in apartment ownership communities is a complex issue, with each community's specific governing documents determining the allocation of expenses. By reviewing these documents, unit owners can better understand their financial obligations and ensure fair and just cost distribution within their communities.
The Federal Court of Justice, or BGH, has found that an apartment owner without a parking space in the community's garage cannot be forced to contribute to the garage roof renovation costs unless there are factual justifications for doing so. In another case, the BGH approved the redistribution of costs based on heated living space, as the previous distribution method was not justified. These rulings underline the importance of basing cost distribution adjustments in apartment ownership communities on factual circumstances and fairness, to prevent arbitrary decisions and potential litigation.
