Special assessments
Special assessments are the financing source when the syndicate of co-owners does not have the necessary funds to meet the expenses of the co-ownership.
This can happen when the syndicate does not have enough money to pay its insurance deductible, when minor repair or maintenance work is required and the syndicate does not have enough money in its current account, when unexpected professional fees are due, when major repair or replacement work must be done and there is not enough money in the contingency fund, etc.
The directors must consult with the meeting of co-owners before making decisions concerning special assessments.
► DUTIES AND OBLIGATIONS OF THE BROKER
The seller’s broker must:
- ask his client if he has received a notice of special assessment from the syndicate of co-owners and, if so, obtain a copy and put it in the file;
- check the appropriate box in clause 8.2 of the form Exclusive brokerage contract – Divided co-ownership;
- if the seller has received a notice of special assessment, check yes under clause D14.10 of the form Declarations by the seller on the immovable – Divided co-ownership, and detail this declaration in section D15;
- provide the form Declarations by the seller of the immovable – Divided co-ownership to the prospective buyer.
In addition, it is strongly recommended that the Request for information to the syndicate of co-owners (RIS) form be completed and sent to the prospective buyer. This form provides an overall picture of the situation, particularly with regard to any outstanding common expenses, future contributions to be expected, the balance in the contingency fund, any legal action undertaken against the syndicate, etc.
The broker representing the buyer must indicate under section 13 of the form Promise to purchase – Divided co-ownership (PPD) the fact that the RIS form is an integral part of the promise to purchase.
If the RIS form is not available, the buyer’s broker should recommend that the buyer make his Promise to purchase conditional upon obtaining this document by adding this condition under clause 9.1 of the PPD form.
