The Paralyzing Sub-paragraph “a” of Article 27 of Costa Rica’s Condominium Property Law

The creation of the Condominium as a legal entity, established by Law No. 7933 on October 28, 1999, allowed for access to a regulated and orderly “neighborhood” life that could be registered and publicized. Condominiums, as gated communities, provide physical and legal security to condo owners, and have been a “hit” over the last 20 years.

While the Condominium Property Law (Law 7933) aims, as its name suggests, to regulate cohabitation among condo owners by separating common property from private interest and defining the limits of each—pointing towards greater understanding and fluidity in neighborly life—Article 27, in its sub-paragraph “a,” imposes a situation that prevents many of the changes that condominiums would like to implement.

Specifically, this sub-paragraph of Article 27 establishes the following:

The Assembly shall act based on the following agreements:
a) Only with the unanimous agreement of all owners can one:

1. Modify the general purpose of the condominium.
2. Vary the proportional area of the units in relation to the total area of the condominium or the area of the common property.
3. Renounce the condominium property regime, provided that the resulting plots or units do not violate other laws.
4. Encumber or alienate the condominium in its entirety.
5. Vary the clauses of the constitutive deed or the condominium and administration regulations.

The unanimity required by the law for any change to the regulations has meant that even somewhat minor issues cannot be resolved because the agreement of one hundred percent of the condominium’s value, gathered in a legally convened assembly, cannot be secured.

Imagine the first condominiums registered in Costa Rica, those that likely arose with significant flaws due to being a novelty and have not been able to correct them to this day.

This unanimity can even play in favor of the person who establishes or develops the condominium, by allowing certain topics to be “set in stone,” such as specific benefits or advantages for that person.

The same happens with the impossibility of varying the area of a filial property in relation to the total area of the condominium. This, in addition to requiring new blueprints with a new area table, requires the famous unanimity because it is a change to the constitutive deed. Therefore, a measurement rectification of one or more filial properties (equivalent to one square meter or more, because if it is decimeters, the Registry can rectify it ex officio) will depend on all the condo owners agreeing. This is certainly paralyzing and even limits the right to property.

A reform to this law is urgent.

Bill number 22.086 is already in the plenary, which proposes a reform of Article 27, specifically to eliminate the unanimity required for changes to the regulations and the constitutive deed, as well as for variations in the area of the filial properties and common areas. It proposes to replace it with the agreement of two-thirds of the total value of the condominium. In this bill, sub-paragraphs 2 and 5 of sub-paragraph “a” of Article 27 would become part of sub-paragraph “b” of that article, leaving the latter as follows:

b) Only with the agreement of a number of votes representing at least two-thirds of the total value of the building can one:

1. Vary the special purpose of a filial property.
2. Construct new floors or basements, excavate, or authorize one of the owners to carry out this work.
3. Acquire new common property, vary the purpose of existing property, or dispose of the way in which it can be used in any form.
4. Authorize the lease of common property.
5. Approve the partial or total reconstruction of the condominium.
6. Vary the proportional area of the units in relation to the total area of the condominium or the area of the common property.
7. Vary the clauses of the constitutive deed or the condominium and administration regulations.

In the above cases, when a single owner represents at least fifty percent (50%) of the total value of the condominium, fifty percent (50%) of the remaining votes gathered in an assembly will also be required.

The last paragraph of this sub-paragraph “b” currently exists in the law, and its purpose is to balance the taking of certain decisions in the condo owners’ assembly when a single owner owns 50% or more of the total value of the condominium, meaning they hold 50% or more of the votes. This situation is common when the developer has not sold the entire project or even when it is strategically chosen.

We are, therefore, awaiting this reform to the law so that condominium life can find a little more agility. Perhaps achieving the agreement of two-thirds of the total value of a condominium will still be an impossible mission in certain cases, and because of this, our responsibility today more than ever in legal and notarial advice is fundamental in the constitution of new condominium projects.