Ladies and Gentlemen, in today's article from the series "Tuesday Mornings for Construction Professionals," we will explain what co-ownership is, its types, and how it can be established. This begins a series of articles on co-ownership.
At the outset, it should be noted that joint ownership is a special form of ownership whereby one thing is simultaneously owned by several persons whose rights are, in principle, equal (see Supreme Court decision of 17 October 2003, file reference IV CK 115/02). Therefore, the provisions on ownership law apply directly to joint ownership.
Under Article 195 of the Civil Code, only real property (movable or immovable) can be jointly owned . However, perpetual usufruct (which constitutes joint use) or lease (joint tenancy) cannot be jointly owned. Although the above forms do not constitute joint ownership, the provisions on joint ownership in the Civil Code apply to them by analogy. Joint ownership is characterized by the following features: unity of the property (item), multiple entities (owners), and the indivisibility of the common right.
The first characteristic of joint ownership is the unity of the jointly owned property . This means that the subject of joint ownership will be a single, specific movable or immovable item. Therefore, the subject of joint ownership will not be a collection of items, such as a book collection or a herd of farm animals (but only each individual item, i.e., each book and each horse).
The multiplicity of entities should not raise any doubts, as this characteristic simply means that for joint ownership to be considered, there must be at least two joint owners. There is no limit to the maximum possible number.
The indivisibility of a joint right means that each co-owner has the same rights with respect to the property as the other co-owners. Therefore, each co-owner may exercise their rights simultaneously and with respect to the entire property . While it is true that in commercial transactions, we encounter division of property for use (division quoad usum), most often made through an agreement, such divisions do not affect the very nature of the joint ownership right, which simply defines the manner in which this right is exercised by individual co-owners. Joint ownership is divided into:
a. Fractional joint ownership , characterized by each co-owner having a designated share in the ownership of the property, which they can dispose of at their discretion (e.g., sell or gift to a third party). In our law firm's practice, we most often deal with joint ownership of land or common property. In the case of common property, in addition to the general provisions of the Civil Code, the provisions of the Act of 24 June 1994 on Ownership of Premises will also apply, which, among other things, governs joint ownership of common areas of the property by all owners of premises in a given property.
b. Joint joint ownership is an indivisible right of joint ownership that arises only in connection with a specific underlying relationship, e.g., assets that form part of the assets of partners in a civil partnership or assets that form part of the joint property of spouses. This type of joint ownership is characterized in particular by the inability of one co-owner to dispose of the asset. Therefore, in the case of, for example, the sale of the asset, the consent of all co-owners will be required, and one cannot simply sell one's share.
Co-ownership can be acquired in several ways. The most common sources of co-ownership include:
a. as a result of legal acts, e.g. concluding a contract (e.g. sale or donation) or by submitting a unilateral declaration of will,
b. by operation of law, in particular under the Civil Code and the Act of 24 June 1994 on Ownership of Premises. The most common legal events that give rise to joint ownership by operation of law include the creation of fractional joint ownership as a result of the acquisition of an inheritance by several heirs (inheritance) and the creation of joint joint ownership in connection with the conclusion of a marriage, resulting in the creation of a statutory marital community of property,
c. as a result of a court decision of a constitutive nature, e.g. a decision to award ownership of real estate in the course of enforcement proceedings, when the real estate was acquired by several persons at auction.
In summary, co-ownership is a special form of property law that, depending on its origin, can take many forms. It benefits from the same protections (with some differences, which we will discuss in subsequent articles) as property law. However, this also means that co-owners are subject to the same obligations as owners.
In the next article, we will outline the rights and obligations of co-owners of real estate, including the rights of owners towards other co-owners and the rights and obligations towards third parties, including public administration bodies.
This article is for informational purposes only and does not constitute legal advice.
Legal status as of November 21, 2023
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