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Magalie Vandenbroucke - Academic year 2019 - 2020/Ghent University
3.1 Are powers of attorney possible?
3.2 What does such a power of attorney look like?
3.3 Who can obtain such power of attorney?
3.4 Are there consumer law implications?
3.5 What is the vision of the practice?
CHAPTER III. POWERS
268. Now that the full framework of the delivery is known, we can proceed to the last chapter of this master's thesis. It has already become clear that apartment co-ownership consists of two distinct parts: on the one hand, there are the common parts, which belong in undivided ownership to all co-owners, and on the other hand, the individual apartment owners have exclusive ownership rights over their private assets (see above no. 19).
269. As stated in Chapter II, the delivery of the common parts is a decision of the general meeting of co-owners and the decision on the delivery of the privatives is taken by the individual co-owners. The apartment owners will therefore be confronted with construction issues in any case. In practice, however, it appears that many individual co-owners are either not sufficiently skilled in construction engineering, or prefer to be left alone when it comes to making these decisions. It may be appropriate to work by means of powers of attorney. In addition, these can also be a useful way of reducing administrative and practical formalities for the contractor as he may be faced with a potentially large number of co-owners (supra no. 92).
270. This last chapter examines whether there is a possibility in the applicable law to take the delivery decision by way of power of attorney (3.1), how exactly this is arranged (3.2), to whom these powers of attorney could be entrusted, if necessary (3.3) and whether there may be implications in terms of consumer law (3.4). Finally, a brief look is taken at the notarial practice's attitude to this (3.5).
3.1 Are powers of attorney possible?
271. The decision to hand over the common parts of an apartment building is a competence of the general meeting of co-owners (supra 184.108.40.206). Each individual co-owner is a member of the general meeting by operation of law and must therefore participate in its deliberations. This implies that each individual co-owner must in principle co-decide about the delivery of the common parts. However, apartment owners can also opt not to be physically present during the deliberations and voting, but to be represented.
If an individual co-owner wishes to make use of this possibility, this proxy will only be valid for one meeting. The ratio legis of this is that every general meeting has an autonomous character and the mandate must therefore be ratified at every new meeting. There is an exception to this rule when the proxy has a notarial power of attorney.
272. It is also possible that the general meeting itself proceeds to grant an authorization with regard to the execution of the delivery (supra no. 110).
273. In addition to the common parts, an apartment building also consists of private parts. The privatives are the exclusive property of the individual co-owners. This implies that they are also exclusively authorized to deliver it (supra no. 99 et seq.). Just like the general meeting, the individual co-owners can also opt to appoint a proxy holder in this context.
274. It can thus be concluded from the above paragraphs that powers of attorney are possible in the context of apartment co-ownership. However, the Apartment Act does set a limit to the use of powers of attorney. For example, a proxy may not accept more than three proxies, unless the total number of votes at his disposal, together with those of the principals, does not exceed ten percent of the total number of votes attached to all lots of the co-ownership. The rationale of this restriction is to ensure that it is made impossible for one individual co-owner to dominate all decisions in the general meeting.
Although this is not apparent from the literal wording of the law, in my opinion this limit can only be regarded as a limit of the number of proxies in the context of participation in the general meeting. This implies that this limitation must be observed when the general meeting has to decide on the delivery of the common parts. If, on the other hand, the individual co-owners wish to grant a power of attorney with regard to the delivery of the privatives, this restriction does not seem to apply in my opinion. As a result, it is possible for all individual co-owners to grant power of attorney to the same person.
3.2 What does such a power of attorney look like?
275. Apart from one paragraph, the Apartment Act contains no concrete provisions regarding the form of the powers of attorney. It can be deduced from this that the common law rules regarding mandates apply.
Mandate is the act of empowering the agent to do something in the name and on behalf of the agent. In principle, a mandate agreement is concluded solo consensu, which implies that there are no mandatory formal requirements. However, the Apartment Act stipulates that the power of attorney must state the name of the agent, which means that a written document is required. This writing can be both an authentic and a private deed and will also be important with regard to providing evidence to third parties.
276. Pursuant to the principle of discretion, the parties are free to determine the scope of the mandate. However, it is important to effectively record this scope in the written agreement, since this will determine the representative authority of the agent – and his possible liability. The power of attorney is on the one hand specific or general and on the other hand express or in general terms. When it comes to a power of attorney with regard to the delivery of apartment buildings, it will be a special and explicit power of attorney, since the assignment of the proxy holder constitutes a specific legal act.
277. The proxy performs the legal act in the name and for the account of the principal, being the general meeting or the individual co-owner. This implies that the agent is in principle not personally bound towards the third party, but that this legal act is directly attributed to the principal.598 However, for this to be the case, it is important that the agent acts strictly within the limits of his acquired powers.
278. If, on the other hand, the agent exceeds his powers, the legal acts he performs are not enforceable against the principal. Applied to the delivery, this would mean that the delivery has not validly taken place, as a result of which the liability for minor visible defects is not (yet) covered and the period for filing a liability claim for minor hidden defects, as well as the ten-year liability period, has not yet expired. starts running (supra 220.127.116.11). However, there is an exception to this: if the general meeting or individual co-owner ratifies a legal act performed by the proxy holder in violation of his powers, the general meeting or the individual co-owner will still be bound by this act. As a result, the delivery of the common parts or the privatives, respectively, is deemed to have been concluded in a valid manner.
279. The question that then arises is which document can provide for such a proxy clause. The rules of co-ownership will often contain provisions regarding the manner of representation and delivery. However, the articles of association are already a complex set of provisions, which may make it more appropriate to arrange the powers of attorney in the context of the delivery in a separate deed.
280. Although powers of attorney can be validly granted in the context of apartment co-ownership, a nuance should be made here. When the general meeting proceeds to grant a proxy, this proxy holder will obviously not be able to take the decision on delivery on its own. The proxy holder will be able to take on all practical and administrative tasks, but the final decision will still remain in the hands of the general meeting of co-owners (supra no. 118). This implies that the proxy holder can only sign the official report of delivery of the common parts of the apartment building under the suspensive condition of approval by the general meeting, which must decide on this by an absolute majority of the votes._cc781905-5cde- 3194-bb3b-136bad5cf58d_
281. When an individual co-owner proceeds to appoint a proxy holder in the context of the delivery of his private asset, it will be extremely important to arrange the scope of this proxy extensively. The section dealing with the liability regimes already indicated that the delivery ensures that the slight visible defects in the structures are covered (supra 18.104.22.168, b). This implies that a liability claim for these defects is no longer possible afterwards. If the individual co-owner were to completely hand over the delivery and would no longer have any decision-making power, he could possibly lose his right to bring a legal claim. To meet this, it seems advisable to also include a condition precedent in this proxy, by analogy with the proxy granted by the general meeting (supra no. 280). Such a condition precedent offers the principal a maximum guarantee since the proxy holder will always be obliged to provide feedback to the individual co-owner, so that the final decision-making power also remains in his hands.
282. The question arises, however, whether this solution will provide a feasible solution in practice under all circumstances. It is possible that the contractor or building promoter, as the initiator of the delivery, will not want to accept such a mandate because it de facto constitutes an incomplete mandate. When the contractor or building promoter is present together with the proxy holder with a view to touring the privatives, both parties will never be able to proceed to a valid and final signature of the delivery report, since the proxy holder is under the obligation to provide feedback. to his proxy. It is therefore not inconceivable that certain contractors and/or building promoters will not agree with this and that this solution will therefore be difficult to achieve in practice.
283. In short, it can be said that a written power of attorney can be drawn up for the delivery of the common parts as well as for the delivery of the privatives, whereby the mandate of the proxy holder must be described very precisely. In addition, it is advisable to provide for an obligation for the proxy holder to always provide feedback to the principal, respectively the general meeting and the individual co-owners, so that the ultimate decision-making power always rests with the principal. The proxy holder will therefore mainly be used to fulfill the formalities – such as the tour of the building – and the execution of the delivery, although he is therefore in no way used to make the final decision for delivery. Such condition precedent is mandatory when the general meeting proceeds to appoint a proxy holder. The question arises whether such a condition precedent will always be a feasible solution in practice when a power of attorney is issued by the individual co-owners with a view to the delivery of the private assets.
3.3 Who can obtain such power of attorney?
284. In what follows, it is examined who could obtain a power of attorney to carry out the delivery. Feedback is given to the explanation of the parties involved (supra 2.3.1).
3.3.1 Construction promoter
285. The building promoter is a professional client who is responsible for the realization of building projects (supra no. 78 et seq.). The building promoter can be assigned both the role of seller and the role of main contractor. In both cases, the building promoter may incur liability, but the interpretation of this differs according to the qualification of the agreement (supra 22.214.171.124).
286. It has already been mentioned above that if a property developer has remained the owner of one of the privatives, he is not allowed to participate in the vote on the delivery of the common parts (supra no. 84). If this prohibition did not exist, a conflict of interest would arise on the part of the building promoter, since he could thus prevent liability proceedings against himself for defects. The building promoter will of course be responsible for the delivery of his privative.
287. If the building promoter has not remained the owner of one of the privatives, the above prohibition does not apply in principle.
288. In my opinion, however, it is immaterial whether or not the property developer has retained ownership of one of the privatives in order to assess whether he can act as a proxy holder for the delivery of an apartment building. There will in all cases be a conflict of interest on the part of the building promoter when it obtains a power of attorney. Naturally, the building promoter will wish to limit his own liability for defects, so that an objective and neutral attitude during delivery cannot be guaranteed in my opinion. This applies to the delivery of both the common parts and the privatives. In addition, such a proxy clause could be regarded as an unlawful clause (infra 3.4).
289. The prohibition on the building promoter from acting as a proxy holder applies a fortiori to the contractor, since the contractor is regarded as the initiator of the delivery (supra no. 86 et seq.). In addition, the delivery is also an important pivotal moment in the context of the assessment of his liability (supra 126.96.36.199). Thus, if the contractor could obtain a power of attorney, it would thus be possible to prevent a liability claim against itself for defects. In that case, the contractor's own interests will prevail and the interests of the individual co-owners – as principals – will be neglected. Moreover, such a clause could be regarded as an unlawful clause (infra 3.4).
290. The architect is responsible for designing the building plans and is charged with a control task. In addition, there may also be an obligation to provide assistance whereby the architect will provide his client with advice on whether or not to deliver the construction works (see above no. 93 et seq.). It is also possible that the general meeting or the individual co-owners proceed to grant a power of attorney to the architect with a view to the delivery and acceptance of the construction works. The architect is the perfect person for this, as he is a professional in the construction sector and is therefore particularly well aware of all construction-technical aspects.
291. The regulations laying down the professional duties of the architect allow the architect to perform a number of acts in the name and on behalf of his client, provided that his mandate is laid down in a written agreement. This document must, among other things, specify the precise scope of this power of attorney. Otherwise, the general rules regarding mandates apply (supra 3.2).
292. However, a side note should be made here: since the architect himself can also be held liable (supra 188.8.131.52, d), if necessary an additional delivery must take place between the architect and the general meeting or the individual co-owners . This in turn increases the complexity of the delivery operation.
293. As is the case with the building promoter and the contractor, in my opinion a conflict of interest will also arise on the part of the architect concerned if he obtains a power of attorney for the completion. There is a chance that he will be inclined to judge his own construction or design errors less rigorously than the errors of the contractor or building promoter, so that he can prevent a liability claim against himself. However, what can be an effective solution is to appoint an independent architect as proxy holder (infra 3.3.7).
294. The syndic is the executive and representative body of the association of co-owners (supra no. 111). In accordance with the Apartment Act, the syndic will be responsible for the implementation of the decisions of the general meeting. The decision to proceed with the delivery of the common parts is one of these. The general meeting can appoint the syndic as proxy holder with regard to the completion of the delivery. However, the final decision on delivery remains the competence of the general meeting; the syndic will only be responsible for its implementation (supra no. 118).
295. Each individual co-owner must participate in the deliberations of the general meeting, but as stated, the Apartment Act provides for the possibility of appointing a proxy.618 The Apartment Act, however, provides for a restriction with regard to the appointment of the syndic as agent: he cannot obtain a proxy from an individual co-owner to participate in the general meeting itself.
296. In the section relating to the role of the syndic, the figure of the statutory syndic has already been discussed (supra no. 112). In practice, the statutory syndic is usually a confidant of the building promoter. It therefore seems in the least appropriate that this syndic can obtain a power of attorney with regard to the delivery of the common parts of the apartment building. In such a situation it will not be unlikely that the property manager will give priority to the interests of the building promoter to the detriment of the interests of the co-owners.
297. On the other hand, there is no legal obstacle for the syndic to provide assistance or obtain a mandate from an individual co-owner with regard to the delivery of his private asset. The syndic will not obtain such power of attorney in the context of his function as syndic, but will perform this task on a purely independent basis. However, it is inadvisable to entrust the syndic with such a power of attorney, as this entails additional liability and, moreover, potentially jeopardizes the neutrality of the syndic at the general meeting.
298. In summary, it can therefore be said that it is possible for the general meeting to grant the syndic a power of attorney with regard to the implementation of the decision to hand over the common parts, although the individual co-owners may not grant him a power of attorney for the participation in the general meeting itself. With regard to the delivery of the privatives, the apartment owners are free to appoint the syndic as proxy holder, although this has previously been discouraged.
3.3.5 Board of co-ownership or board of directors
299. When the general meeting of co-owners decides to set up a co-ownership council or a management board, the main task of this council is to ensure that the property manager properly performs his tasks (supra no. 123 ). In general, the delivery is therefore not part of her tasks.
300. The delivery of the common parts is a power of the general meeting. However, it is possible that the general meeting grants a proxy to a committee specifically charged with the delivery. Nothing prevents the general meeting from appointing the board of directors for this purpose. If this is the case, the tasks of the council must be clearly defined, they may have a maximum duration of one year and the council must issue a detailed report on this.
301. In the event that the general meeting has charged the syndic with the delivery of the common parts, the syndic cannot, as a rule, delegate this power to third parties. However, there is an exception to this in the event that the syndic obtains the consent of the general meeting. In this way it is made possible for the property manager to transfer his power of delivery to the Board of Directors.
302. With regard to the delivery of the privatives, the individual co-owners are in principle free to grant a power of attorney. Such power of attorney can be assigned to the Board of Directors without any problems. In my opinion, this implies that the board of directors is the ideal body to act as proxy holder in the context of the delivery of both the common parts and the private assets.
3.3.6 Auditor of the accounts
303. The auditor of the accounts is an independent person who has the required expertise to check the accounts and books of the VME (supra no. 125 et seq.). The powers of the statutory auditor must be laid down in the rules of internal order and are therefore assigned powers. In principle, one of these assigned powers could be the delivery, although, in my opinion, this seems inappropriate. The auditor is an expert in the field of accounting, but will essentially not have the required construction expertise to detect any defects. This possibility is therefore further abstracted.
304. With regard to the delivery of the common parts, the general meeting of co-owners is free to charge a committee with the delivery (supra no. 110 and 300). This committee may consist of independent third parties with special expertise in the construction sector. It is important to note that the decisions taken by this committee must subsequently be ratified by the general meeting. This implies that when the committee proceeds to sign the minutes of (provisional or final) delivery, this actually happens under the suspensive condition of approval by the general meeting of co-owners (supra no. 280)._cc781905-5cde -3194-bb3b-136bad5cf58d_
305. It is also possible that the general meeting has appointed the syndic as an agent for the delivery. The property manager will only be able to transfer his powers with the express permission of the general meeting. When this permission is available, it will be possible to charge an independent third party, usually an expert in the construction sector, with the delivery of the common parts of the apartment building.
306. As regards the delivery of the privatives, the individual co-owners are free to appoint an agent. If necessary, they can appoint the same independent third party(s) as the person(s) who act as proxy holder for the delivery of the common parts.
3.4 Are there consumer law implications?
307. The Apartment Act allows the use of powers of attorney in principle, subject to a number of limitations (supra 3.1). This section examines whether such a proxy clause may have certain implications in terms of consumer law.
308. In the context of the proxy clauses, Book VI on market practices and consumer protection is of particular importance. As already discussed in the section on liability for minor hidden defects, there is no doubt as to whether the provisions of Book VI WER apply to building contracts when they are concluded between a consumer and a company (supra no. 199) .
309. A consumer within the meaning of art. I.1, 2° WER must necessarily be a natural person. As a result, the VME as a legal entity cannot rely on the protection mechanisms from Book VI. When the general meeting of co-owners – as a body of the VME – concludes an agreement in which it grants a company a power of attorney with a view to the delivery of the common parts, Book VI does not apply. In concrete terms, the provisions of Book VI only apply in the event that an individual co-owner enters into an agreement with a company.
310. The question that then arises is which of the parties referred to in the previous part (supra 3.3) should be regarded as an undertaking. A company is any natural person or legal entity that pursues an economic goal in a sustainable manner. In concrete terms, the building promoter, the contractor and the architect will undoubtedly qualify as companies. When an individual co-owner concludes an agreement with one of the three parties mentioned above, the rules from Book VI WER thus naturally apply.
Even if an individual co-owner enters into a mandate agreement with a third party who has special expertise in the construction sector, the rules from Book VI WER will also apply, since this third party will also qualify as a company.
311. If, on the other hand, an individual co-owner grants a power of attorney to the board of co-ownership to carry out the delivery, there is no contract between a consumer and a company, since the board of co-ownership does not, in my view, qualify as a company in the meaning of art. I.8, 38° W
When a power of attorney is granted to the syndic with regard to the delivery of a privative, the rules from Book VI WER do not apply in my opinion either. As a result of this power of attorney, the syndic will perform the assignment independently of his capacity as syndic, but on an independent basis (supra no. 297). However, this will not be an activity that the property manager 'pursues in a sustainable manner', so that in my opinion it does not qualify as a company.
312. In summary, it can be said that when an individual co-owner enters into an agreement – in which a power of attorney clause is included for the implementation of the delivery – with the building promoter, the contractor, the architect or a third-party expert, the rules from Book VI WER apply. will find. If, on the other hand, a power of attorney is granted to the syndic or co-ownership council, this will not be the case.
313. The application of Book VI WER to building contracts entails a number of consequences. For example, there will be an information obligation on the company and the parties must be vigilant that their agreement does not contain any unlawful clauses. Such stipulations are prohibited and void. The question that arises here is whether a proxy clause is in danger of being regarded as an unlawful clause within the meaning of Book VI WER
314. Book VI, on the one hand, contains a black list of terms that are always unlawful.645 When a term appears on this list, the court has no discretion. Art. VI.83, 6° WER determines that a clause is unlawful if it gives the company the right to unilaterally determine whether the delivered product meets the requirements of the agreement. When the building promoter, the contractor or the architect concerned obtains a power of attorney within the framework of the delivery of the privatives, they will have to accept it in the name and on behalf of the individual co-owners. Acceptance implies that it must be judged whether the works have been carried out in accordance with the agreement (supra no. 42). If the building promoter, the contractor or the architect obtains a power of attorney for the delivery, this is de facto an unlawful clause since they will have to assess their own works for their conformity. As a result, this clause is prohibited and void and the individual co-owner cannot proceed to grant a power of attorney for the delivery of the privatives to the building promoter, the contractor or the architect.
315. In addition to the black list, Book VI provides a general testing standard. In that case, there is an unlawful term when a term, alone or in conjunction with other terms, creates an apparent imbalance between the rights and obligations of the parties to the detriment of the consumer (supra no. 200). It must necessarily be an apparent imbalance, which implies that the imbalance must be obvious or obvious. The judge assesses this in concrete terms, which means that, among other things, all circumstances surrounding the conclusion of the agreement are taken into account.
If the agreement with the building promoter, the contractor or the architect involved contains a clause whereby they obtain a power of attorney, they themselves take the decision regarding the delivery of the privatives. As mentioned earlier, the delivery is an important pivotal moment in the context of their liability (supra 184.108.40.206). If they themselves are held responsible for the delivery, they will perhaps assess defects that have arisen through their fault less strictly or even accept them without further ado. However, after acceptance, the liability for minor visible defects is covered and it is no longer possible for the individual co-owners to take legal action against this. The rights of the apartment owners are thus limited to such an extent that in my opinion it can be concluded that there is an apparent imbalance between the rights of both parties to the detriment of the consumer.
316. If the individual co-owner proceeds to conclude a mandate agreement with a third-party expert (ie a company), the rules from Book VI WER also apply as stated (supra no. 310). This means that this agreement may also not contain unlawful terms. In this case, however, a power of attorney to carry out the delivery will, in my opinion, not pose any danger of being qualified as an unlawful stipulation within the meaning of art. VI.83, 6° WER The third-party expert must also assess the conformity of the construction works in this case, but is not the party that realized these construction works. As a result, there will also be no possibility to 'unilaterally assess the delivered products for their conformity', since this third-party expert has not delivered any products himself.
In this case, of course, the general assessment standard will continue to apply, which implies that the power of attorney, which is granted to the third-party expert, may not create an apparent imbalance between the rights and obligations of both contracting parties to the detriment of the consumer. However, if the suspensive condition of the approval of the individual co-owner is linked to this power of attorney (supra no. 280 et seq.), the final decision-making power remains in the hands of the individual co-owner. The third-party expert will therefore be solely responsible for the implementation of this decision, so that the individual co-owner will not lose his rights in my opinion and there will be no apparent imbalance.
317. At the beginning of point 3.4 it was discussed that the rules from Book VI WER only apply when it concerns an agreement that was concluded between a company and a consumer (supra no. 308 et seq.). This implies that the VME cannot invoke the protection mechanisms from Book VI WER when it proceeds to grant a power of attorney. The VME is in fact a legal person and therefore does not qualify in any way as a consumer within the meaning of art. I.1, 2° WER (supra no. 201).
During the discussion of the various parties involved, it was already discussed that an additional delivery should take place between the (building promoter) main contractor and the various subcontractors (see above nos. 82 and 90). If these parties enter into an agreement containing a proxy clause, the protection mechanisms from Book VI WER cannot be invoked either, since in this case both parties are regarded as companies within the meaning of art. I.8, 38° W
318. As with the exoneration clauses in the context of liability for minor hidden defects (supra no. 202 et seq.), an important nuance must be made here. The entry into force of the new B2B regulation on 1 December 2020 will have a number of important consequences in this context, which could not be ignored in the light of this master's thesis.
319. The future B2B regulation introduces a black list of terms that are unlawful at all times and a gray list of terms that are rebuttably presumed to be unlawful. When the building promoter, the contractor or the architect involved obtain a power of attorney to carry out the delivery, there is a possibility that they can block a liability claim against themselves. In my opinion, this can be qualified as a tortious term from the gray list: “a term that improperly excludes or limits the rights of a party in the event of default or defective performance of the contractual obligations by the other party.” 652 When the works are accepted without further ado, the rights of the principal – this can thus be both the VME and the (construction promoter) main contractor – are limited because they are no longer able to file a liability claim afterwards. due to minor visible defects. However, this concerns a rebuttable presumption, so that it will be up to the building promoter, the contractor or the architect, if necessary, to provide proof to the contrary.
320. Future art. VI.91/3, §1 WER also contains a general testing standard. This open standard is a repetition of the wording from Art. I.8, 22° WER and is filled in identically to the general testing standard in consumer matters (supra no. 315). In this case, it will be up to the court to determine in concrete terms whether a proxy clause in an agreement between two companies creates an apparent imbalance between the rights and obligations of both parties. When a power of attorney is granted to the building promoter, the contractor or the architect, this apparent imbalance will, in my opinion, undoubtedly arise due to the fact that these parties will potentially assess their own mistakes less strictly and, if necessary, will simply accept the construction works. In this way, it will no longer be possible for the VME or the (construction promoter) main contractor to file a liability claim for minor visible defects afterwards.
321. When a power of attorney is granted to a third-party company with expertise in the construction sector, the B2B regulation will also apply from 1 December 2020. In that case too, the parties will have to ensure in the future that the agreements do not contain any unlawful stipulations. If a third party obtains a power of attorney to carry out the delivery, in my opinion there will be no danger of a violation of Art. VI.91/5, 4° WER since the third-party expert does not have a conflict of interest, contrary to what was described above (supra no. 319). Naturally, the general standard of assessment will still apply and it will be up to the court to verify in concrete terms whether such a power of attorney entails an apparent imbalance between the rights and obligations of the parties (supra no. 320).
3.5 What is the vision of the practice?
322. As a result of the investigation into the possibility of granting powers of attorney in the context of the delivery of apartment buildings, a small – telephone – survey was conducted among a few civil-law notaries. The question was asked whether they had already come into contact with such proxies in notarial practice. The answer to this was unequivocal: in practice civil-law notaries are usually no longer consulted for the execution of deeds relating to the delivery. However, the articles of association do provide for powers of attorney clauses in certain cases, but in that case only powers of attorney are granted with a view to the delivery of the common parts. It is usually recommended that the individual co-owners, with or without assistance, be present in person at the delivery of their privative. In this way, the chance is minimal that they would lose their rights to file a liability claim afterwards.
To meet this, in my opinion a condition precedent of approval by the individual co-owner can be added to the proxy, analogous to the situation in which the general meeting proceeds to grant a proxy. The question is, however, whether this will always lead to the desired result in practice (supra no. 280 et seq.).
323. Apartment co-ownership is a special form of forced co-ownership in which a distinction is made between the common parts and the privatives. The common parts belong to all co-owners jointly and the individual co-owners also have the exclusive right of ownership over their private property.
324. The organization of the common parts is left to the association of co-owners or VME. To complete its tasks, the VME has four bodies: the general meeting of co-owners, the syndic, the board of co-ownership or board of directors and the auditor of the accounts. The decisions regarding the common parts are taken by the general meeting as the decision-making body of the VME. On the other hand, the decisions regarding privatives are taken by the individual co-owners themselves.
325. The delivery of apartment buildings is a complex whole of legal acts, parties involved and legal consequences. In practice, the terms delivery and acceptance are often used interchangeably, although strictly speaking they cover different meanings. Delivery is the legal act whereby the contractor makes the construction works available to the client, which thus constitutes an obligation on the part of the contractor. Acceptance, on the other hand, is an obligation on the part of the client and consists of the acknowledgment of the fact that the works were carried out in accordance with the agreements, the plans, the specifications, the rules of the art and with the prescribed materials.
326. Due to the application of the Breyne Act and its Implementing Decree, the delivery of apartment buildings is double delivery. Firstly, a provisional acceptance will take place that aims to confirm the works. Afterwards, a one-year warranty or maintenance period commences within which the contractor remains obliged to repair minor shortcomings and defects. It is concluded with a final delivery that is equated with the acceptance of the construction works. In the context of apartment co-ownership, these delivery acts are in turn doubled since a distinction is made between the common and private parts. In concrete terms, four deliveries thus take place within the framework of apartment co-ownership: the provisional delivery of the common parts and of the privatives and the final delivery of the common parts and of the privatives.
327. Although a distinction is made between the delivery of the common parts and the delivery of the privatives, the process is similar in both cases. The contractor is regarded as the initiator of the delivery and will have to proceed to address a request for delivery to the general meeting of co-owners and to the various individual co-owners respectively. After this, a tour will take place through the apartment building to determine whether or not the building has certain defects. After the tour, the parties must sign a delivery report. It is possible to make reservations and/or comments.
328. The acceptance of the construction works – often the moment of final delivery, unless contractually provided otherwise – is an important pivotal moment for assessing the liability of certain actors in the construction process. With regard to the liability of the contractor and the architect, a distinction can be made between three liability regimes:
- Liability for minor visible defects is generally covered from the acceptance of the construction works. However, this requires that no comments and/or reservations are formulated in the delivery report. If, on the other hand, this is the case, the contractor and/or the architect are obliged to make repairs. Only afterwards will the client be able to initiate a legal claim and this within a reasonable period of time after the defects have been established in the delivery report.
- The second liability regime concerns liability for minor hidden defects. A distinction must be made here between the guarantee period and the procedure period. The guarantee period is the period within which the contractor and/or architect can be held liable for hidden defects. This period is equated with the common law limitation period of ten years (art. 2262bis, §1 Civil Code). The procedural period, on the other hand, is the period within which a liability claim must be lodged. This period is a reasonable period after the hidden defect was discovered or should reasonably have been discovered.
- The last liability regime is the ten-year liability for serious stability-threatening defects pursuant to art. 1792 j° 2270 Civil Code that commences at the time of acceptance of the construction works. This ten-year period is an expiry period in which no distinction must be made between the guarantee period and the procedural period. The defects must therefore manifest themselves within this ten-year period within which the liability claim must also be instituted. This liability affects public order, as a result of which exoneration clauses are prohibited.
The first two liability regimes are neither public order nor mandatory law, which makes it possible to include exoneration clauses in the contract, for example. However, the parties must bear in mind that not just any exoneration clause is permitted. Exoneration clauses may also run the risk of being qualified as an unlawful clause in the light of Book VI WER. Parties must also take into account the new B2B regulation from 1 December 2020 (cf. Title 3/1 of Book VI WER).
329. A special case is the liability of the building promoter. The property promoter can act in two different capacities, which means that the liability regimes are slightly different. On the one hand, the building promoter can qualify as a seller, which means that he can be held liable for minor visible and hidden defects. The claim based on the ten-year liability will also be transferred to the buyers as an accesorium of the property sold, although the Breyne Act provides for a possibility to still hold the property developer liable under art. 1792 Civil Code. On the other hand, the building promoter can qualify as a contractor, which means that he can be held liable for minor visible and hidden defects, as well as for serious defects that threaten stability. The main difference between the two qualifications is that the claim for minor hidden defects must be brought within a short period of time in the case of a promoter-seller and within a reasonable period of time in the case of a promoter-contractor.
330. The second part of the research question explored the extent to which it is possible to work in this delivery process by means of proxies. Practice teaches us that individual co-owners are often insufficiently trained in construction engineering or prefer to be left alone when making all kinds of construction-technical decisions. An adequate solution may be that the individual co-owners can appoint a proxy holder to carry out the delivery of the private assets. In addition, the general meeting itself can also proceed to appoint a proxy holder with regard to the delivery of the common parts.
331. The Apartment Act allows in principle to work through powers of attorney. With the exception of the provision that states that the power of attorney must bear the name of the proxy holder - from which it can be deduced that the power of attorney must in principle be in writing - the Apartment Act does not contain any provisions regarding the form of these powers of attorney. It is therefore assumed that the common law rules on mandates apply.
332. The question that then arises is who could obtain such a power of attorney. In my opinion, the most appropriate option is the board of directors or a committee of independent third-party experts. Both parties can obtain a power of attorney for the delivery of both the privatives and the common parts. However, some nuances should be made here:
- The individual co-owners can grant a proxy for participation in the general meeting. To this end, art. 577-6, §7, paragraph 6 of the Dutch Civil Code, however, a limit of a maximum of three proxies per proxy holder. However, this limit can be exceeded provided that the number of votes available to the proxy holder does not exceed ten percent of the total number of votes attributable to all lots of the co-ownership.
- When the general meeting grants a power of attorney with regard to the execution of the delivery of the common parts, this must always take place under the suspensive condition of approval by the general meeting. The general meeting is and remains the decision-making body of the VME and must have the last word in this context.
- In order for the individual co-owner as principal to have the most guarantees when he grants a power of attorney with regard to the delivery of his privative, it is recommended that the same condition precedent is included in the power of attorney clause, by analogy with the powers of attorney granted by the general meeting. The question arises, however, whether this will be a feasible solution in practice under all circumstances, since such a mandate de facto constitutes an incomplete mandate.
- The provisions of Book VI of the Code of Economic Law also apply to building contracts. The parties must therefore ensure that such proxy clauses are not qualified as unlawful stipulations. The new B2B regulation will come into force from 1 December 2020, which means that such a danger not only exists in the relationship with the individual co-owner/consumer, but also between companies themselves.
333. The research question that was central to this master's thesis was "How can the delivery of apartment buildings be arranged efficiently in the current legal framework and to what extent can powers of attorney be validly granted for this purpose?" This master's thesis has attempted to provide a clear overview of the entire delivery process, including references to French and Dutch law. The question whether proxies can be validly granted for this purpose should be answered in the affirmative, although in my opinion one should be critical of the proxies granted by the individual co-owners.
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