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Understanding the Cotenancy

Sometimes, we hear people from older generations talking about historical events that we didn’t witness, perhaps because we were not even around when such events took place. Other times we may have heard about some

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Sometimes, we hear people from older generations talking about historical events that we didn’t witness, perhaps because we were not even around when such events took place. Other times we may have heard about some of those events, or we were around when they happened, but maybe we were too little to understand their importance. Perhaps some of them are already crossing your mind, like the moon landing in 1969, the murder of John Lennon in 1980, the “Marathon of Hope” led by Terry Fox in that same year, the fall of the Berlin Wall back in late 1989, and so on and so forth.

So, as of today, it’s reasonable to say we are living through a historical event. Leaving aside for one moment all the stress and anguish this has brought, it’s clear that a pandemic is not something you get to witness on a regular basis (luckily). I don’t know about you but, as for me, this has also brought a slight change in perspective; well, not necessarily a change, but a reinforcement of what truly matters in life and a reminder that nothing is trivial.

We all are, to some degree fragile and dependent on each other, so it’s sensible to meditate on the course that our lives have been taking up until this point (especially when you take into account that words such as “tomorrow” and “certainty” don’t go together). Think about this: perhaps before the pandemic struck you had been devoting a little too much time to your job, so much time that right now you may have some trouble remembering the last time you actually did something as simple (but not trivial, I insist) like sitting down with your family (at least the side of it you actually like) and just talking or playing some tabletop game. Since I mentioned Lennon a few lines back, he once sang “life is what happens to you while you´re busy making other plans”. 

Perhaps now, because of the pandemic, you have been spending more time with your family or your partner, or maybe you are good with being left alone but you recognize the perks of having someone by your side. Truth be told, we are social creatures by nature, and sometimes the circumstances indicate that some things are more properly handled in conjunction with another person. This feeling applies to many different scenarios in life, and for the purposes of this article, we have decided to address one of them briefly: the Cotenancy.

The cotenancy is, in basic terms, just another way of handling the full right of ownership over a property. In this case, the ownership is divided between 2 or more individuals. 

In the legal doctrine (at least the one that derives from the Roman law system), it has been said that there are different types of cotenancy. For example, there’s the ownership “through quotas”, through which any party involved has a non-concrete, “ideal”, fractional or aliquot part of the thing that is subject to the ownership. In such cases, each co-owner can operate with his/her right separately from the others, but they are obliged to act together when it comes to aspects that cannot be subject to bending.

Other type of cotenancy that is usually addressed in the doctrine is the one known as “divided property” (also known as “pro diviso”). In this case, the full power belongs to various owners that make up the ensemble or outfit of faculties that are included in the right of ownership. In other words: the content of such right is divided between the co-owners, since the cotenancy can be established by their sole will or by “incidental community”.

Enough about the doctrine though. In Costa Rica, the Civil Code establishes a legal regime that comprehends undivided co-ownership. This is clearly stated in articles 270 to 274 and 864. For example, article 270 states:

“When a thing belongs simultaneously to two or more persons, the owners jointly execute all the rights of the individual owner, in proportion to the part that each one has in the common property. The co-owner cannot, however, dispose of a given part of the thing without having it adjudicated beforehand in the respective division”. 

Clear as a bell, right? Okay, let’s break that down a bit.

Whenever a thing (or property) belongs simultaneously to two or more people, these are jointly considered as if they were the sole owner of that thing, each one of them contributing their respective portion. According to the law, a co-owner is not able to dispose of a given, specific part of the thing freely; in fact, all of the co-owners have the obligation to contribute to the maintenance expenses of the thing. 

So, as you may be able to tell by now, the principle is that no one can dispose of a part. Nevertheless, the Code foresees an essential principle in this field, and that is the freedom to demand an eventual division of the property since no one is compelled to stay in association or community with others. This constitutes an unwaivable right.

Now that we have reached this point, let’s try to imagine another scenario. Perhaps once you actually deemed it proper to establish co-ownership with someone else around here (whoever doesn’t matter), but now the situation has changed and, all of a sudden, you have found yourself dealing with (for lack of a better word, perhaps) a nagging co-owner. How can you request that division we have been addressing so far?

Through a process known as “localización de derechos” (“localization of rights”). As of today, such a process can either be held through a court or even a notary public. In this way, each co-owner shall locate his/her right or ideal quota following the procedure established in the Law on Localization of Undivided Rights (law no. 2755).

Given the significance behind this, the process can be a bit intricate. This localization cannot affect the remaining co-owners, and the interested party must acknowledge before the courts the eventual adjoining owners, mortgage creditors, a hypothetical seize and such that may be of interest in the process.

This means that every co-owner is legitimized to request the division as long as the request comes from him/her (a person holding an eventual usufruct wouldn’t be able to do it, for example).

Of course, and similar to the limitations that the right of ownership is subject to (also addressed in the aforementioned article), an eventual division of a property must not contravene the urban planning laws that apply in the area, since such laws are usually linked to public, social interests that are deemed more relevant than individual, particular interests.

According to the Civil Code, the division can either by material or economic. The first one proceeds if it’s possible to divide the thing or property; in this way, the division is settled by adjudicating parts of the common thing or property to each co-owner in proportion to their respective rights. In this way, the abstract quota that was in an undivided state is substituted for a sole and exclusive right of ownership over each resulting material portion of the division. Which is to say that the original object is reproduced in smaller portions, basically.

As for the second division (the economic or civil one), such division proceeds when the material division is not possible because the object is not materially or legally divisible. In this case, there’s the possibility of adjudicating the object to one of the co-owners while compensating the remaining co-owners for the value of the respective quotas, as long as they agree with this; in case they don’t, well, an auction would have to be organized and the resulting price would be distributed amongst them (notice how the law gives priority to an eventual agreement between them as opposed to the eventual judicial process). This is precisely why this division is called “economic” or “civil,” since it doesn’t affect the material nature of the object since it aims to recover its economic value. 

Once the division has taken place, the co-owners become exclusive owners of the part that was adjudicated to each one of them. Of course, this doesn’t mean that a hypothetical easement can be divided: easements, at least around here in Costa Rica, are constituted as a sole entity, and they are meant to remain that way until their utility eventually expires.

Anyway, as I stated in the beginning, this article was aimed to give a brief insight into the topic, and it’s reasonable to say that this is already taking a bit too long. But remember, if you eventually want more insight regarding a specific issue, you can always contact us. 

We truly hope you are safe and healthy during these hectic times.

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daguilar@outlierlegal.com

Attorney with experience on Real Estate, Real Estate planning, and notary affairs. Has focused on the branch of Civil Law known as ius in re or rights over property. Has experience also in non-contentious procedures and arranging reports on legal affairs in general

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