What does it consist of?
First, we need to understand what a community or condominium is. Well, that happens when a good or right is shared among several people.
In addition, property shares are assigned to each of them. If that good in question is a property, it is called co-ownership or condominium, although people often use the three terms interchangeably.
So, once we have a clear understanding of what a community is, let's talk about the extinction of co-ownership or dissolution of co-ownership. Basically, it is when the situation where several people share ownership of a good ends.
Sometimes you hear other words like co-ownership, co-ownership, or community of goods, but they all refer to the same thing.
Types of Extinction of Co-ownership
Extinction of co-ownership by mutual agreement
When everyone agrees, canceling the co-ownership is a piece of cake: one person can buy the others' shares, or the person who wants to leave can receive compensation. The property can also be sold, and the money divided among the owners according to their respective shares.
Before doing so, however, the owners must value the property and agree on how to proceed. Then, they can go to a notary and draw up a deed to formalize everything, paying the necessary taxes. If the property is the home of a divorcing couple, the agreement must also be included in the regulatory agreement, and if it is approved by the court, that agreement and the judgment become the deed of cancellation of the co-ownership.
Extinction of co-ownership through judicial proceedings
If there is no agreement, the only option is to go to court and file a lawsuit to divide the property. The court will decide whether each person receives their share or if it is sold and the money is divided. There is no specific legal procedure for this, but generally, a public auction is held to sell the property.
Necessary Documentation
Property titles of the assets subject to the dissolution of the community.
D.N.I. of the co-owners. If any company is involved, current powers of attorney or appointments of administrators.
For urban properties, a certificate from the homeowners' association stating that all community fees are up to date.
Cadastral references of the assets (last property tax receipt).
Whether they are leased or not.
Value assigned to each asset.
How the assets are allocated to the co-owners.
How the costs of the operation are paid: Notary fees, municipal capital gains tax (if urban properties are involved).
In what situations can this service be used?
The causes for the extinction of co-ownership are established in the Civil Code in articles 395 to 406.
The Civil Procedure Law must also be taken into account in cases where the division of assets must be carried out through judicial auction.
The causes for extinction of co-ownership are, in principle, the same as for the extinction of ownership, such as abandonment, destruction, or usurpation, among others.
However, due to the conditions of co-ownership, the Civil Code establishes some specific causes:
Renunciation of rights by the co-owners in favor of one of them.
Sale of the asset to a third party and distribution of the proceeds among the participants of the community.
Division of common property. Any co-owner has the right to request the division of assets. It is a judicial procedure; the initiation of the division of common property declares the extinction of co-ownership. The result can be material division, constituting horizontal property, or economic division if the asset is indivisible. In this case, one of the owners retains ownership, and the others receive compensation according to their shares. Division can also be achieved through auction if there is no agreement between the parties.
The most common cause for the extinction of co-ownership is the owners' desire not to continue being part of this community. However, as we have seen, it is not the only one.