In the event of inheritance or property purchase, you may find yourself in joint ownership. You will own the same property with one or more other people. If you plan to remain in joint ownership for some time, it's best to organize its management.
Poorly prepared or poorly organized joint ownership can be a source of conflict and deadlock. To prevent and avoid conflict, it is advisable to draw up an indivision agreement. This will enable you to optimize everyone's rights and facilitate the management of your property.
Leave nothing to chance
Thejoint-ownership agreement is a contract by which the joint owners draw up a list of the rights and duties of each. All points must be listed. Starting with a description of the undivided property(ies) and the share of each undivided co-owner.
But also the duration of the agreement. If the agreement is for a fixed term, it may not exceed 5 years. This period may be extended by express decision or by tacit renewal. At the end of this period, each undivided co-owner may request partition.
If indivision is established for an indefinite period, each undivided co-owner may terminate it at any time, provided this request does not have a "malicious" connotation. The agreement must also list the expenses and the breakdown of their payment according to the share of each joint owner.
Another important point to address: the enjoyment of the property. It may be agreed that one of the undivided co-owners will occupy the property for a fixed or indefinite period, in return for payment of an occupancy fee (the amount of which will also be specified in the agreement). It is also possible to set a schedule for occupancy of the property, with "rotation" between all the undivided co-owners.
The agreement must also specify the conditions under which decisions will be taken, and by what majority. On this point, the rules laid down in this document can relax, or on the contrary reinforce, the default provisions of the Civil Code.
Last but not least, you will need to anticipate the procedures for leaving indivision and passing it on. In particular, this will prevent "outsiders" from entering the joint-ownership arrangement in the event of the death of a joint owner. In this case, the allocation of the deceased's share can be defined in advance.
Apart from the case of death, it may also happen that one of the undivided co-owners wishes to leave indivision. To ensure that the division takes place under the best possible conditions, it's a good idea to set out how the share of the deceased will be distributed.
Good to know
The joint-ownership agreement must be drawn up in writing, otherwise it will be null and void. We even recommend that it be drawn up by a notary. This is mandatory if the indivision concerns one or more properties.
Appointing a manager
The indivision agreement may decide to appoint one of the undivided co-owners or a third party as manager. The manager will have full authority to carry out administrative acts relating to the day-to-day management of the property. He or she will oversee the upkeep of the property and decide on any work required. He or she will manage insurance contracts, pay water and electricity bills, etc.
The manager may also enter into residential or professional leases (but not rural or commercial leases). He will collect the rent, look for new tenants or terminate the lease...
Once a year, he is required by law to report on his management. He is liable for any mismanagement.
Marie-christine Ménoire