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Outstanding community fees

Published 12/06/2009

One of the most frequent questions we are asked by property purchasers is who is responsible for the payment of possible outstanding community fees?

If we are contacted by a worried client, discovering themselves in the situation that their purchase is affected by a community fee debt we, at Ábaco, assess the problem from two different angles. The first being before the signing of the Title Deeds when the problem can and should be avoided, and secondly after the signing when, if no precaution was taken, the problem can still be resolved.

1. With regards to the first situation a law was introduced in 1999 introducing the obligation to stipulate in the Title Deed the situation regarding community debts and this information be submitted by a corresponding certificate, issued by the community secretary and endorsed by the community president within a period of seven days from it’s application. The aforementioned persons are responsible for the accuracy of the content of the certificate as well as its issue within the given period.

The purchaser is often encouraged to waive his right to receive the above mentioned certificate, the law permitting this. The corresponding paragraph in the Title Deed is amended accordingly quoting the non-compliance due to reasons of urgency. We strongly recommend our clients to exercise their right to demand this certificate and in the case that there should later be discovered pending community debts not only the vendor can be approached but also the president and secretary.

2. In the situation that a property has been sold and the Title Deed has been signed with community debts outstanding the purchaser becomes responsible for the debts incurred during the current year when the sale takes place and the previous year. This does not signify, however, that it is not possible to claim the outstanding amount from the seller, the purchaser having paid them first so as not to put the property in jeopardy. Debts arising from unpaid community fees prior to the year before the sale of the property are not the responsibility of the new purchaser and the community secretary must pursue the seller for payment of these debts. In many cases the new purchaser received a demand as this is the easier option but not the correct one.

Of further assistance to the purchaser in the situation of outstanding community fees is the fact that if the seller fails to advise the community secretary of the sale of the property and the change of ownership the seller is still liable for the debt. Many sellers, knowingly selling their property with a community debt make no such contact with the secretary to avoid settling their debts, however, is not doing so they continue to be liable, a point in favour to the seller.

Pablo Arteaga

Pablo Arteaga
Lawyer
lawyers@abacoadvisers.com



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