Irish Times Property Clinic 8th day of October 2015.
Publishing Date; Thursday the 8th day of October 2015.
Q I live in a small apartment complex built in 2008 where the common areas have not yet been transferred to the owners’ management company (OMC). The management company requested the transfer a while ago but it seems there is always a delay of some sort resulting in the conveyancing still not done after all this time.
Six months ago the developer applied for planning permission to build large houses on adjacent land and build ancillary parts for the houses on the apartment’s common areas, all without any agreement from the OMC.
The council did not consider the ownership of the common areas at all and the matter is now in appeal with An Bord Pleanála.
If An Bord Pleanála also disregards this argument, wouldn’t such a decision provide a green light to developers to delay conveyancing so as to retain the common areas for their own ends? Is there anything an OMC can do to prevent a developer from building on areas they actually do not own?
A Your lease agreement binding you to your owners’ management company (OMC) would traditionally have a provision within it that says that during the construction of the development the developer may alter or vary the development as they see fit provided they have planning permission.
The Multi-Unit Developments Act 2011 (MUD Act 2011) Section 5 was written so as to require that the common areas would be in the ownership of all existing OMCs from the first day of October 2011 where a unit in the development was sold.
This legislation places the onus on the developer to have the common areas transferred to an owners’ management company. As the legislation is civil law and not criminal law, there is no consequence for breaching same and has rarely been observed thus far. The process is onerous and costly for the developer and the OMC also requires legal representation that is independent of the developer to oversee the transfer. Section 5 (2) of the MUD Act 2011 has certain required qualifications so I will assume that your existing development is substantially complete and more than 80 per cent of the units have been sold.
It would seem that a suitable option, should the appeal with An Bord Pleanála fail, is for the OMC to immediately retain legal representation and apply to the Circuit Court under Section 24 of the MUD Act 2011. The OMC would seek the granting of a court order to compel the developer to transfer the common areas. If the developer fails to transfer the common areas following a Circuit Court order they are then in breach of a court order thus falling under criminal law.
Following a successful transfer of the common areas to your OMC it may then protect itself from the development on its land under Irish Tort law. The action of the developer should it begin construction on your land may well constitute private nuisance and the OMC would therefore require legal representation to seek a Quia timet injunction where damage to your land has not yet occurred but is imminent.
Paul Huberman is a chartered property and facilities management surveyor and a member of the Society of Chartered Surveyors Ireland (SCSI)
Author: Paul Huberman of H&H Property Management Consultants Ltd
Publish Date: 08/10/2015