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The legal hypothec of a syndicate of co-owners registered for the payment of common expenses (hereinafter “legal hypothec of a syndicate of co-owners”) is a legal action that allows the syndicate’s representatives to use the fraction of a co-owner as security for the payment of common expenses.
Any person duly authorized to act for a syndicate of co-owners (for example, a director or manager) may initiate proceedings to register a legal hypothec of a syndicate of co-owners against a co-owner.
The owner who has defaulted for more than 30 days on the payment of his common expenses (which also include his share of the syndicate’s contingency fund) may be charged with a legal hypothec of a syndicate of co-owners.
Article 2729 of the Civil Code of Québec provides the procedures for registering the legal hypothec of a syndicate of co-ownership:
2729. The legal hypothec of a syndicate of co-owners charges the fraction of the co-owner who has defaulted for
more than 30 days on the payment of his common expenses. It will come into effect only from the registration of a notice indicating the nature of the claim, the amount owing on the day the notice is registered, and the expected amount of charges and claims for the current financial year and the next two years.
Thus, the legal hypothec of a syndicate of co-owners comes into effect only at the time the “Notice of a legal hypothec” is registered by the syndicate of co-owners in Quebec’s Land Registry for the fraction of the immovable belonging to the defaulting co-owner.
Contrary to similar notices, the notice of registration of the legal hypothec of a syndicate of co-owners does not need to be served by a bailiff on the defaulting co-owner, but it shall nevertheless be notified to him.
Ultimately, if the default of payment for common expenses has not been remedied by the co-owner, the syndicate may require the forced surrender of the fraction of the immovable belonging to the defaulting co-owner and sell his fraction as payment of said expenses. However, considering the dire consequences for a co-owner, common expenses are often paid before a syndicate requires a forced surrender.
OF THE LEGAL HYPOTHEC OF A SYNDICATE OF CO-OWNERS
Even if the hypothecary recourse is initiated, the debtor or any other interested party may defeat exercise of the right by paying the creditor the amount owing to him and by paying the costs incurred before the prior notice expires.
After entering some information into Hypotek’s Web platform, its algorithms and our professionals will determine your eligibility for a legal hypothec of a syndicate of co-ownership and schedule the formalities that need to be completed within the applicable time limits.
Once your file has been submitted, Hypotek will take care of the rest. All that is left for you to do is wait for the debtor to send you the payment related to your claim.
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