While we are waiting to hear how the first community meeting went (the silence at the moment is deafening...) I came across some notes re voting rights, rules etc which I thought might be helpful to all those experiencing this system for the first time. I hope they are not too lengthy or boring to read!!
Entering a Community and the Role of the President
What is a community and what will it cost me?
Nearly everyone buying a home in Spain will automatically become a member of a community. They will be expected to contribute financially to the community in line with their share or “coefficient”. This share is written into the title deeds “Escritura” of the purchased property and is not changeable except in rare circumstances (sub division etc.). The coefficient is calculated when the community is completed and, as a rule of thumb, is roughly proportional to the size of your apartment or house in relation to the overall size of the community.
What you actually pay will be your share of any expenditure* agreed at an Annual General Meeting or an Extraordinary General Meeting. It is your responsibility to be aware of these charges and to pay them ignorance is no excuse and bills are not sent. There are two very good reasons for paying your community charges on time. The first is the moral issue as you are expecting your fellow owners to finance you if you do not pay and in some cases the community will deteriorate as, of course, the cleaners and gardeners won’t work for nothing. The second reason is that the community now has the ability to (through court action of course) freeze your bank account and seize the apartment. Of course this is always a last resort and time consuming but the community always wins and the costs are charged to the delinquent owner. The community can also apply penal charges to late payments and owners in debt have no voting rights at a meeting.
A word of warning here. Before you sign at the notary always make sure that your solicitor has obtained a certificate from the community showing any debt on the property. If he/she hasn’t then sorry, any debt becomes yours. Obviously this also applies to any outstanding mortgages on the property but this is not a community issue and your solicitor SHOULD check everything. In Spain the debt is on the property not the individual.
* If a charge, even if voted for by a majority, is classed as an improvement and your individual cost exceeds 3 months community charge then you do not have to pay however you can not participate in the improvement. For example if at an AGM it was voted to install a satellite system to pick up Greek T.V. stations and you did not wish to receive these programmes then you would not have to pay. For more detailed explanations refer to the Horizontal Laws. So what do I pay for?
Essentially the charges are to cover the general costs of maintaining the communal elements (gardens, swimming pools etc) of which you have full use. You will not be required to pay for things you would not use (for example lift maintenance if you live on the ground floor) however it is not your decision. It will be written in the community rules. Generally the President or Administrator will be pleased to give you a copy before you buy.
Who decides what we pay and who we employ?
Basically you do. The thing you must always remember is that the community belongs to you. Never ever say “They” have done this or that because anything important or costly (except legal necessities) is voted for at an A.G.M. or E.G.M. and you have the same rights as all the other owners. Ensure that your voice is heard either by attending the meeting or appointing a proxy to vote on your behalf. You have the right to put forward any proposals or reject any proposals or budgets.
But someone has to do the day to day stuff.
The President is in charge of the community and has total authority as your representative. He/she is ultimately responsible in law for the actions of the community and represents the community in all legal aspects. He/she is a signatory, together with the administrator for cheques and bank payments. The role of President is mandatory. If no one volunteers then a simple drawing of lots takes place and the winner (loser!) is President. He/she she must apply to the court to be relieved of the office and, as any legal action takes forever here, there is no point as the office is for one year. Obviously any person who does not wish to be President will not function correctly and in such a case will probably leave all the work to the Administrator. The Administrator is again a legal requirement but unless the community is very small then the Administrator will be an employed professional with the necessary software, staff and experience to support and advise the President but it is the President who makes the decisions.
At the A.G.M. the President will present the actual expenditure for the prior year and the budget for the coming year. These must be approved by the meeting. Generally sufficient information on expenditure is sent with the meeting invitation. The approval of the expenditure and budget together with the election (re election) of the President and Administrator plus agreement of the previous years minutes are mandatory agenda items. Proposals from owners are other agenda items but to be voted on must be mentioned in the posted agenda. Discussion on “Any other business” can be held and, if the meeting agrees the President will call a future E.G.M. to vote on the issue.
This may all seem fairly complex but in fact the laws relating to how a community must be governed are straight forward and epitomize a democratic regime. That is why it is important that your voice is heard.
The HORIZONTAL LAWS can be downloaded from the link below, however the community rules can only be obtained from the Administrator or President of your community. These rules cover behaviour, pets etc. in the community. It’s no good buying an apartment only to find Fido can not share it with you. You also have the right (as an owner) to inspect all the previous years minutes including balance sheets.
One or two points worth mentioning about meetings.
Generally only the President can call a meeting however 25% of the owners combined can legally call a meeting through the Administrator if the President refuses.
A meeting always has two start times or “calls”. For the meeting to be legal on the first “call” 51% of owners must attend to form a quorum. As this very rarely happens the law states that any number of owners form a quorum when a second meeting is arranged but that this meeting must be at least thirty minutes after the first call. Therefore when you are invited to an A.G.M. it will have “First Call” and “Second Call” times. The second call being thirty minutes after the first and the time the meeting will start.
As mentioned it is possible under this system for two or three owners to steer the community in a direction to suit them which may not suit you, so again the message is participate in person or by proxy.
Unless the community has vastly different sizes of homes most owners coefficients will be similar enough that a simple majority vote will decide. The condition is one owner one vote (not one vote per apartment). Strictly speaking a proposal can only be passed if it has a majority of owners and coefficients however if a situation occurs when a majority of coefficients (for example the builder may still own half the community so has 50% of the coefficients but only one vote) is for a proposal and a majority of owners are against he can not force through his proposal because both criteria are not met.
What else will I have to pay?
To the community, nothing else, only your community charges and any one offs agreed at a meeting.
I.B.I. Is, more or less, local rates and is charged once a year (Between 15th March and 22nd May)
Tasa Basura. Is for rubbish collection and is taken twice a year (Between 24th April to 30th June and 3rd July to 17th September)
It is better to ask your solicitor to set up direct debits for all the above plus your electric and water charges, he/she should do this automatically as it is included in his fees which are always a fixed percent. If you go back later and ask him/her you may be charged again. When they are set up it is hassle free as long as you keep money in your account. Even if only one payment is missed the companies will not try again and you may find your water or electric cut off for a bill you missed last year or an old I.B.I. bill that attracts interest at 10% if not paid.
Tips.
If the majority of owners are one nationality it will greatly influence the way the community is run. The owners are the community.
Ask what language is used at meetings and in written communication. If the owners vote for Chinese then Chinese it is with no obligation to translate (Although the official meeting minutes must be filed in Spanish)
Of course do your best to learn Spanish and you will get more from life here.
Download and read the Horizontal Laws
This is the link:
http://www.eyeonspain.com/spain-magazine/horizontal-laws.pdf
This message was last edited by gericom99 on 9/30/2007.