Updated: Sep 1
The Condominium Act (Chapter 398 of the Laws of Malta) is the primary law that regulates how condominiums are administered.
What is a Condominium?
The law defines a condominium as a building or group of buildings where two or more people jointly own, use, or enjoy certain shared areas, called “common parts,” while each person separately owns their individual unit within the same building or complex.
In practical terms, the most common form of a condominium is a block of apartments, where each unit (flat) is individually owned, yet the common parts are co-owned by all the individual owners (collectively referred to as the condomini) in undivided shares.
The undivided shares in the common parts are presumed to be equally distributed among the condomini. For instance, in a block comprising five apartments, each apartment owner is presumed to hold a one-fifth (1/5) share in the common parts, unless otherwise stated in the contracts of sale.
Which are the “Common Parts”?
While most contracts of sale nowadays clearly list which areas of the block are to be considered common, the Condominium Act provides a non-exhaustive list of what is presumed to be a common part, unless otherwise stated in the deed of sale. These include:
The land upon which the building or complex is constructed
The foundations and external walls, including any common dividing walls with neighbouring properties
The roof, airspace, and shafts
The entrance doors, staircases, stairwells, corridors, and lobbies
Any courtyards, common gardens, or shared open spaces
Lifts, wells, cisterns, drainage pipes, all installations for water, gas, electricity, heating and similar services up to where the said installations branch off exclusively to serve an individual unit
And generally, any other part of the property that is intended for shared use or enjoyment.
If a contract of sale expressly excludes certain parts from the common parts, or defines the common parts differently, such contractual provisions prevail over the law. It is common, for example, for the roof and airspace to be kept in private ownership and therefore be excluded from the common parts.
When to Appoint an Administrator?
If there are up to three unit owners, they may administer the condominium jointly or appoint an administrator. If there are more than three unit owners, the condomini must appoint an administrator. The administrator must be appointed during a meeting held between the same condomini and such administrator shall hold office for a period of two years unless otherwise agreed.
After appointing an administrator, the condominium must be registered with the Land Registry Agency. The administrator then serves as the legal representative of the condominium, authorised to handle all matters related to the common areas, including taking legal action, for example, to collect unpaid contributions from individual unit owners.
Among the key responsibilities of the administrator are handling the maintenance and repairs of the common parts, maintaining financial records, keeping a register of all condomini, managing the condominium’s funds, holding general meetings, and recording minutes of those meetings.
What is a General Meeting?
A general meeting includes all unit owners, and a quorum is required for this kind of meeting to proceed. This quorum requires the presence of condomini representing at least two-thirds (2/3) of all units.
If a quorum is not reached within thirty minutes of the scheduled start time, the meeting will be adjourned and reconvened either on the same day the following week at the same time and place, or on a different date, time, and location as specified in the notice by the administrator. Should a quorum still not be present within thirty minutes at the reconvened meeting, the present condomini at that meeting will be considered to constitute a valid quorum.
Decisions such as those which alter the aesthetics of the condominium or involve serious alterations to the common parts, require the unanimous consent of all condomini. Others, like carrying out other alterations to common parts, setting or amending condominium rules, require at least a 2/3 vote of units represented at the meeting. Decisions outside these critical categories, such as agreeing upon the cleaning services of the common parts, may be passed by simple majority.
The Crucial Role of General Meetings
During the general meetings, important decisions regarding the common areas may be made. These meetings hold wide-ranging powers, including but not limited to appointing or confirming the administrator and setting their fee, approving the annual expenditure budget and the administrator's accounts, and deciding on extraordinary repairs. Topics such as the installation of a lift, the allocation of its costs, structural façade works, and other related matters may also be discussed and voted upon.
Apportionment of Costs
The law states that the costs for the upkeep and repair of common areas are generally shared amongst the condomini based on the value of each unit, unless otherwise agreed. In practice, it is commonly agreed that costs are shared equally between the units. If certain parts benefit co-owners unequally, expenses are divided according to the extent of use each condominus can make of them. For areas like staircases, courtyards, or roofs that serve only part of the building, maintenance costs are to be borne solely by the benefiting parties.
A condominus may be exempted from contributing to certain expenses particularly if one does not intend to benefit from the alterations and/or innovations that allow for separate use. However, this exemption is not always straightforward or easily applied. The right to opt out is limited to cases where the changes are purely decorative in nature, or where the associated costs are excessively onerous, especially in light of the particular condition and prestige of the condominium.
Given that this exemption is subject to interpretation, it often gives rise to disputes. What qualifies as "excessively onerous" or "decorative" may differ. Additionally, even if a condominus claims no intention of using or benefiting from the innovation, the enhancement may still indirectly improve the overall value or appeal of the building, potentially benefiting all units regardless of direct use.
Therefore, the decision to contribute or not is rarely black and white, and legal guidance may be necessary to resolve disagreements and ensure a more harmonious condominium environment.