The concept of jointly owned property was introduced by Law no. 27 of 2007 “concerning ownership of jointly owned real property in the Emirate of Dubai”. This law came into effect on April 1st, 2008. Additional regulations, known as “directions”, were issued in 2010 in order to regulate a few subjects such as the content of Jointly Owned Property Declarations and Building Management Statements, the developers’ disclosure obligations, consumer protection matters and the licensing and registration of Owners Associations, among others.
1. What is the definition of Jointly Owned Property?
Jointly Owned Property is defined by the law as “the whole or any part of a building or land, or both, which is divided into units intended for separate ownership where parts of such building or land are designated as Common Areas”.
2. What are the common areas?
Common areas of the Jointly Owned Property are defined as the common parts designated for common use by the owners and occupiers of the units. An exhaustive list of the common areas is provided by Article 7 of the Law no. 27 of 2007. Such list, which can be modified by the site plan, includes mainly the following: structural components of the property; parking areas, watchman rooms, recreational facilities and equipment, swimming pools, gardens, storage facilities; equipment and systems of main utilities, including electricity generators, lighting systems, gas systems and equipment, cold and hot water systems, heating and cooling systems, air conditioning systems and waste collection and treatment facilities; elevators; fittings, connections, equipment and amenities used by owners of more than one unit. The dividing walls between two adjacent units will be shared by the owners of both units provided that these walls are part of the common areas.
3. Who is responsible for the common areas?
The Owners Association is responsible for the management, operation, maintenance, and repair of the common areas and each owner is responsible for maintenance of their own units. Any renovation or repair made to an individual unit and affecting any part of the common areas will have to be approved by the Owners Association. Each unit owner has to pay to the Owners Association his share of the annual service fees to cover the expenses of management, operation, maintenance, and repair of the common areas. According to the law, such share is calculated based on the area of the unit compared to the total area of the Jointly Owned Property.
4. How does the Owners Association work?
Upon registration of the sale of the first unit in a Jointly Owned Property, an Owners Association will be legally constituted. The Owners Association comprises the owners of units, including the Master Developer or Sub-developer in respect of unsold units. The Owners Association is a non-profit entity and with a legal personality independent from its members. It may sue and be sued in its own name and may own movable property.
A Board, elected by the members of the association, will make the day to day decisions. Some decisions cannot be taken by the Board. These restrictions include for instance dispute matters, fixing or changing the amount of the annual service fees, changing the rights or obligations of the unit owners. Each unit owner, and the developer in respect of unsold units, is entitled to attend and vote at the meetings of the general assembly of the Owners Association. Each unit owner has a number of votes in proportion to his share in the Jointly Owned Property.
To sum up, owning a unit in a Jointly Owned Property is not an easy process. It is therefore essential for unit owners to have a thorough knowledge of their rights and obligations, the description of the common areas, the responsibilities of the Owners Association, among other subjects. Appointing a lawyer to review the Jointly Owned Property Declaration can help to avoid unpleasant surprises in the future.