MONTREAL, March 18th 2020 – Bill 41 was adopted yesterday. It brought about modifications to two major elements in co-ownerships: precisions on the description of private units (reference unit) and modifications to article 1074.2 of the Civil Code of Quebec. The modifications presented are already in force.
Description of the private portions (reference unit)
The new dispositions specify the conditions required for the adoption of this description. It must be adopted by the co-owners, representing more than half of the votes of the co-owners present or represented (article 204 of amended Bill 41).
Moreover, the deadline of June 13th 2020 remains the same. In the actual context, we recommend that you delay all general meetings of co-owners and that you comply with the governmental measures regarding gatherings.
However, Bill 41 repeals the consequences that were initially intended in the absence of respecting this delay. It was originally planned that past June 13th, “the private portions are deemed, in the condition they are in on that date, to include no improvement made by a co-owner, unless the syndicate has already placed a description of the private portions that complies with that article at the disposal of the co-owners.” Despite this repeal, the absence of a description will not be without consequences. Syndicates that do not respect this delay will expose themselves to complications in case of settlements. Considering all these elements, the RGCQ is taking part in discussions with the different stakeholders to present a complete portrait of the situation.
The government also made modifications to article 1074.2 of the Civil Code of Quebec. The interpretation of this article by the majority of insurance companies caused discord. There were numerous cases of settlement refusals regarding a co-owner’s liability in the reimbursement of the franchise paid by the syndicate.
Article 1074.2 now reads (the modifications have been underlined):
The sums incurred by the syndicate to pay the deductibles and make reparation for the injury caused to property in which the syndicate has an insurable interest may not be recovered from the co-owners otherwise than by their contribution for common expenses, subject to damages it can obtain from the co-owner bound to make reparation for the injury caused by the co-owner’s fault and, in the cases provided for in this Code, for the injury caused by the act, omission or fault of another person or by the act of things in the co-owner’s custody.
Any stipulation which is inconsistent with the provisions of the first paragraph is deemed unwritten.
The government’s objective was to resolve the problem created by the first version of this article. It is still too soon to be certain of the consequences of this addition. We will relate our complete analysis of Bill 41 as soon as possible.