What is a Condominium Cooperation?
A Condominium cooperation is considered to the a legal entity and it consists of all the unit owners. A condo can sue for damages or injury to its property caused by any individual. It also means that the condo corporation can be sued in respect of any matter connected to the condo for which the unit owners are jointly liable. In addition, a condo corporation may enter into contracts as relates to the affairs of the condo. A condominium corporation is created upon registration fo a Condominium Plan with Alberta Land Titles.
Registering a condominium plan with land titles cancels the Certificate of Title to the property and issues separate titles for each unit describes in the plan. The title for a unit cannot be transferred and mortgages cannot be in place on the units until such time as the Condominium Plan has been registered at a Land Title Office.
Unit Owners possess the Certificate of Title for the unit and the same Bundle of Rights and fee simple ownership is available. Because Condo involves living in close proximity to others, there are certain rules known as Condo Bylaw and governing policies, which are placed on unit owners for the benefit of the entire community.
Each unit owners is financially responsible for a portion of the overall expenses for the maintenance, repair, and replacement of the common property within a condominium. The portion of financial responsibility assigned to each unit owner for their share of the common property is called the Unit Factors. The share of the common property held by each owner is included on their respective unit title and expressed as the number of the unit factors. The total sum of all unit factors for a condominium plan must equal 10,000.
The condominium’s developer is responsible for determining how unit factors are distributed among all the units and must disclose the method of distribution. Unit factors may be calculated based on a units construction cost, size or location within the condominium. In most cases, the developer will assign unit factors based on the proportionate floor space of each unit relative to the total floor space of all the units in the condominium. To allocate unit factors based on relative size, developers apply the following formula to each unit:
Formula for Calculating Unit Factors:
Unit Factors = Unit Floor Space m2 (Sq. ft.) / Total Floor Space in m2 (sq. ft) x 10,000
Unit factors serve the following three purposes for the condominium:
- Establish the proportion of common area expenses for which each unit is responsible
- Define the voting rights associated with each unit owner
- Determine fund allocation should the property status as a condominium be terminated