Publication date: 11.08.2024
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Liquidation of condominiums: grounds, procedure, consequences
Liquidation of a condominium (an association of co-owners of an apartment building) is the process of terminating the activities of the association. It includes a number of organizational, legal and financial stages. The liquidation of condominiums is a complex process that requires compliance with all legal norms and rules, as well as attention to details, to ensure the correct completion of the association's activities.
Question
What is the advantage of condominiums?
Answer
The condominium allows co-owners to directly manage resources and make decisions about expenses, repairs and maintenance of the house. Compared to management companies, a condominium may have fewer bureaucratic procedures. Co-owners can better control the quality of service, choose contractors and monitor the performance of works.
Question
What is an indicator that the condominium is on the verge of liquidation?
Answer
The condominium accumulates significant financial debts or cannot fulfill financial obligations in a timely manner, liquidation may be the only way to avoid further financial losses and settlement with creditors. Problems in management, such as frequent conflicts between co-owners, poor management of resources, insufficient control over expenses, can lead to the liquidation of condominiums. If the number of co-owners has decreased to such a level that the effective functioning of the condominium has become impossible or extremely difficult, this may be a reason for liquidation.
The OSBB can be liquidated in the following cases:
- Acquisition by one person of all premises in an apartment building: If all premises in an apartment building become the property of one person, liquidation of the condominium is one of the possible procedures. In this case, the need for a condominium as a management body no longer exists, since all premises belong to one person.
- Decision-making by co-owners on liquidation of the association: Co-owners can make a decision on the liquidation of the condominium at the general meeting, in accordance with the association's charter and the requirements of the law. Such a decision is often made in case of internal problems, financial difficulties or other circumstances.
- Court decision on the liquidation of the association: The court can make a decision on the liquidation of the condominium in case of violation of the legislation or on other legal grounds, for example, in case of systematic violations of the charter or financial obligations.
These grounds for the liquidation of condominiums are the main ones, but the actual circumstances may vary depending on the specific situation and legal requirements.
The procedure for the liquidation of condominiums:
- Making a decision on liquidation and forming a liquidation commission: First, it is necessary to hold a general meeting of co-owners and make a decision on the liquidation of the condominium in accordance with the association's charter and the requirements of the law (a majority of votes is required). Next, it is necessary to appoint a liquidation commission or a liquidator who will be responsible for the liquidation process.
- Notification of the registration body: Submit documents to the registration body (state registrar) about the liquidation decision, including the minutes of the co-owners' meetings and the decision on the appointment of the liquidator.
- Appeal to the fiscal authorities: Submit an application to the tax authorities for verification.
Get certificates about the absence of tax debt and violations.
- Notification of creditors and debtors: Officially notify creditors and debtors of the liquidation. Determine the deadline for creditors to submit their claims to the liquidation commission.
- Closing Bank Accounts: Close all bank accounts that will not be used during liquidation.
- Carrying out a property inventory: Carry out a complete inventory of all the property of the condominium and prepare the relevant documents.
- Dismissal of salaried employees: If there are salaried employees, ensure their dismissal in accordance with labor legislation (with payment of all due compensations and benefits).
- Compilation of the interim liquidation balance sheet: Compile the interim liquidation balance sheet, taking into account all the claims of creditors. Settle with creditors based on this balance sheet.
- Distribution of the remaining balance: After settlements with creditors, distribute the remaining balance among the condominium co-owners.
- Closure of Bank Accounts and Destruction of Seals: Complete the closure of all condominium bank accounts, if not done previously. Destroy seals, stamps and other attributes used in the activity of condominiums.
Consequences of the liquidation of condominiums:
In the case of liquidation of the association of co-owners of an apartment building (OCSB), the balance of funds after meeting the demands of creditors is distributed among the co-owners in accordance with their shares in the joint property. Here is a detailed description of the residual funds distribution process:
- Determination of remaining funds: After settlement with all creditors, the liquidation commission or liquidator determines the balance of funds remaining in the condominium.
- Assessment of shares of co-owners: Distribution of funds is carried out in proportion to the area of premises owned by co-owners. This may include the area of apartments, non-residential premises or other real estate objects in an apartment building.
- Settlement of debts: Before distributing the funds, a settlement of the debts of each co-owner to the condominium is carried out. According to the charter of the condominium, all debts incurred as a result of non-payment of utility bills, contributions to funds or other obligations are taken into account.
- Payment of shares: Each co-owner is assigned a share in the remaining funds in proportion to the area of their premises after taking into account the debt settlement.
- Dispute resolution: If the amount of the co-owner's debt exceeds the amount of his share in the liquidation funds, and the co-owner refuses to repay the debt, this issue is resolved in court. The court will review the case and determine whether the debt is enforceable and what steps should be taken to pay it off.
Services of a lawyer in the liquidation of condominiums:
Here are the main types of legal services that can be useful in this case:
Lawyer consultation and legal analysis of the situation: A lawyers online will help determine whether there are all legal grounds for liquidation and whether legal problems can be avoided. The lawyer will develop an action plan for the liquidation of the condominium, taking into account the specifics of the association and the requirements of the law.
Preparation of documents: The lawyer services online will help prepare and draw up the minutes of the meeting of co-owners, where the decision on liquidation is made. Preparation and verification of documents for submission to the registration authority, such as amendments to the articles of association or other documents confirming liquidation.
Interaction with authorities: The lawyer will prepare and submit applications to the registration authority and fiscal authorities. Assistance in interaction with tax authorities, obtaining certificates on the absence of debt.
Lawyer services for legal support: In case of disputes with creditors, debtors or other persons, the lawyer will provide legal assistance in resolving them. The lawyer help will ensure the updating of all documents in the registration authorities and their timely submission.
Liquidation of condominiums can be a complex and lengthy process that requires compliance with legal requirements and procedures, so it is important to carefully consider all possible alternatives and ensure the right approach to solving this issue. Legal services in the liquidation of the association of co-owners of an apartment building (OSBB) are important to ensure the correctness and legality of the process.
The lawyer advice will help to avoid many legal mistakes that can complicate the liquidation process, ensure compliance with all legal requirements and facilitate the resolution of complex issues.
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