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Divided Co-ownership: When the Rights of the Many Outweigh the Rights of the Few

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Litigation & Dispute Resolution and Real Estate

Under the regime of divided co-ownership, the rights of the many sometimes outweigh the rights of the few when those rights conflict. This is the lesson to be drawn from the Court of Appeal's well-reasoned decision Bourbonnais et al c. 9168-3615 Québec inc. et al (PDF available in French) handed down earlier this week in our client's favour.    

The appeal basically consisted of determining the scope of a deed of correction that was passed by the requisite majority of the co-owners at a duly-held meeting. The deed corrected a second declaration of co-ownership (usually referred to as a concurrent declaration of co-ownership) that was supposed to transform and govern one of the units initially created in the project's first phase. Indeed, this second declaration had inadvertently been published for all of the units instead of just for the unit in question.

In the first instance, Judge Corriveau of the Superior Court recognized that the deed of correction made the second declaration that was initially problematical unenforceable against the appellants, which logically should have settled this case's fate. Still, the appellants were dissatisfied with this ruling and asked that not only the deed of correction be stricken, but that the second declaration be stricken as well.

The Court of Appeal dismissed the appellants' motion to strike. The trial judge's decision was well founded in fact and in law. The decision made by the majority of the co-owners was indeed a logical and practical solution.

The Court of Appeal points out, and with good reason, that by failing to challenge the trial judge's finding of unenforceability, the appellants "recognized the validity of the deed of correction, per se, and the assembly of co-owners' power to adopt it" (par. 41). 

In conclusion, it rightfully stated one of the cardinal principles of divided co-ownership:

"[TRANSLATION] [46] Remember that the particular form of ownership that is divided co-ownership limits the classic ownership right of each divided owner, a point that Judge Forget emphasized in Société d'habitation et de développement de Montréal v. Bergeron [1996 R.J.Q. 2088]:

It can undoubtedly be argued that the rights of divided owners are less broad that those of sole owners: they are limited by law and by the declaration of co-ownership. I can easily imagine that the rights of divided owners must, in some cases, yield to the rights of the many, in this case the syndicate, but only if these rights conflict […]. (emphasis added)

[47] The same holds in this case, where appellant's motion to strike conflicts with the rights of the group that convened an assembly of co-owners, where it opted for another solution to deal with the inscription error of the second declaration, which is homogenous for all co-owners."

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