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The Condominium HOA Meeting Procedures

 

 THE CONDOMINIUM HOA MEETING  PROCEDURES IN COSTA RICA

By Rick Philps

It should be clarified at the out-set, that this regime only applies to condominium property, registered in the Costa Rica National Registry, and not to individually titled lots registered outside of the condominium property regime (Ley de Condominio) . It is common for developers of single family lot subdivisions in Costa Rica, to represent to prospective purchasers, that an HOA will be formed to deal with matters of a common interest, in the public areas of the subdivision, and to propose to levy fees on the property owners to carry-out the mandate of such an HOA. Such HOA’s are purely voluntary in nature, as far as participation by property owners is concerned.. They do not have the legal authority to carry-out any proposed mandate, or to collect fees from the property owners in the subdivision, that they purport to govern. These HOA’s are unconstitutional in Costa Rica, as having a purpose which is contrary to the inalienable rights of property owners, granted under the Costa Rica Constitution. Although the formation of HOA’s in this circumstance makes practical and logical sense, their mandate and the collection of any fees from property owners, is unenforceable.

 

The Condominium Home Owners’ Association Meeting (Asamblea General de Propietarios) in Costa Rica, is governed by three important pieces of legislation, the Commercial Code, the Regulatory Law of Condominium Property, and the individual Administration Regulation for each Condominium complex.

 

The legal Administrator, which can be a person, or a Costa Rica corporation, registered as such in the National Registry, and the HOA (Asamblea General de Propietarios), make-up the governing body of a Condominium complex. The Administrator is the legal functionary, who has the authority to represent the Condominium in all legal matters, to administer the Condominium in accordance with the Administration Regulation, to carry-out the Resolutions of the HOA, passed at a duly constituted Ordinary, or Extraordinary Meeting, and generally answer to the HOA during his/its term of appointment.

 

In calling and giving legal notice of an Ordinary, or Extraordinary Meeting of the Condominium HOA, it is necessary to interpret the three governing bodies of legislation, previously mentioned. The calling of the Ordinary Meeting (AGM), or Extraordinary Meeting, is usually done by the Administrator. Meetings may also be called by the property owners representing at least one-third of the value of the Condominium as a whole, in circumstances of the Administrator refusing, or failing to call a Meeting of the HOA.

 

Notice of the Meeting must be published in Spanish, in the Gazette (La Gazeta), the official Costa Rica government legal publication, and where English or Spanish speaking owners exist, the practice is to also publish Notice in English or Spanish as the case may be, in a newspaper with National circulation in Costa Rica, both publications having to meet the Notice publication time requirements as set-out in the Administration Regulation for the Condominium. The Notice must also be delivered in writing to the address for delivery provided by the owners in the Register of Owners for the Condominium. The Notice must include the date, time, and place for the Meeting, and the Agenda for the Meeting. The Meeting must be held in the legal domicile for the Condominium, unless one hundred percent of the owners pass a Resolution in a Meeting, to hold such Meetings elsewhere. The Notice must also include a provision for the calling of a second Meeting, thirty minutes following the calling of the first Meeting, should a quorum of votes not be formed in the first Meeting, which quorum in the first Meeting, requires voting representation of two-thirds of the value of the Condominium as a whole. In the second Meeting, a quorum is formed by the number of votes present. Legal Notice of the Meeting may be dispensed with, should one hundred percent of the voting owners attend the Meeting and unanimously vote to dispense with the legal notice provisions. The Resolution of such, must be signed by all of the voters in attendance, to be valid (Commercial Code Art. 158).

 

Legal representation of the owners at the Meeting, is also a matter of significant legal application. Only one party present may vote on behalf of any single condo unit, but that same party may hold and exercise a proxy on behalf of any of the other units, as well. With many condominium units owned by absentee owners, either personally, or by corporations, voting by proxy at the Meeting has become a major legal item to consider. If the personal owner of a unit is present at the Meeting, merely a Passport, a Costa Rica Residency Card, or a Costa Rica Identity Card need be shown, in order to legally vote. Likewise, if a legally empowered Director of the registered corporate owner is present personally at the Meeting, a Power of Attorney (Personeria) from the company, and a document to prove identification, must be presented in order to vote. If a personal owner does not live in Costa Rica and will not be in attendance at the Meeting, they may appoint a person as a proxy, by way of a Special Power of Attorney (in Spanish), which will need to be notarized in their home country, and then authenticated by the Secretary of State (USA only), and by the Costa Rica Consulate which is nearest to where they live. This Special Power of Attorney will need to be presented at the Meeting by the proxy holder, along with appropriate identification. If no legally empowered Director of a corporately owned unit will be at the Meeting, such a Director may also grant on behalf of the corporate owner, a proxy by way of a Special Power of Attorney (in Spanish), to a party to vote on behalf of the corporate owner. If the Director is in a foreign country, this may be done in two different manners. In the first case, it may be granted by notarization and authentication, in the same manner as in the case of a personal owner. In the second case, a Resolution (Acta) of the General Assembly, in the form of a Special Power of Attorney (in Spanish), for the corporation may be prepared and signed by the Director empowered, appointing the party as proxy, following which a Costa Rica Notary may certify the Resolution, the original of which must be presented by the proxy holder at the Meeting, along with appropriate identification. Obviously, a Costa Rica Attorney and Notary must be involved from the out-set, to correctly complete this documentary process.

 

Voting at the Meeting is done on the basis of the value of the represented condo unit, as a percentage of the Condominium as a whole. A more valuable condo unit carries a greater voting weight. Items on the Agenda fall into three categories of voting requirements; those requiring one hundred percent unanimous approval of the condo unit owners, those items that represent a two-thirds majority of votes of the value of the Condominium as a whole, and those items which merely require a simple majority of votes based on the value of the condominium as a whole, to pass.

 

Meeting Minutes must be kept during the Meeting, recorded in the General Assembly Minute Book in Spanish, at the conclusion, and signed by the ad-hoc President and Secretary appointed for the Meeting. Any Resolution passed at the Meeting, such as the appointment of a new Administrator, requiring to be recorded in the National Registry, must be notarized by a Costa Rica Notary, in the Notary’s Protocol Book and filed in the Registry accordingly.

 

It is important that these procedures be followed explicitly, otherwise, Resolutions passed at the Meeting may be declared as invalid and unenforceable, by an existing or future condo unit owner.

 

Copyright.  Richard Philps 2008   This article may not be reproduced or copied in any manner without the express written permission of the copyright holder.

 

 

 

 

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