CONDOMINIUM LAW

CONDOMINIUM LAW
REPUBLIC ACT NO. 4726
- also known as “The Condominium Act”

DEFINITION OF TERMS
Condominium
– an interest in real property consisting of absolute ownership
in a unit in a residential, industrial and commercial building and
common ownership in the land on which its located and in common
areas of the condominium project.

• Condominium Unit
– the space bounded by the interior surface of those intended
for independent use or absolute ownership.
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• Common areas
– the entire project, such as the land, building structures,
hallways, elevators, stairways, electrical, water and plumbing system,
and all amenities in a condominium project, the exception is the inside
of the individual condominium unit.

• Condominium corporation
– a non-stock and non- profit corporation consisting of
condominium unit owners which is the management body of the
condominium project and owner of its common areas. This is
synonymous in function and nature to the homeowners association in
subdivisions except that it is taking the form of a corporation. Take
note therefore that it is the reason why a condominium unit can be
personally owned by possession and title by foreigners but only up to
40% of the total number of units of the whole condominium project.
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• Condominium project
– the entire parcel of land including all the structures thereon.
• Master deed
– the enabling act which creates the condominium and contains
the description of the land, building, common areas facilities use of the
building, declaration of restrictions and plans of the land and buildings
and annotated on the certificate of title.
• Declaration of restrictions
– refers to the set of rules, procedures, policies and limitations as
to the management and usage of units and common areas in a
condominium project which constitutes a lien upon the project and each
unit and building upon all unit owners, occupants, and others holding any
right or interest in the project, pursuant to the provisions of the
Condominium Act and other related laws.
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Sec. 4 Provisions of this Act shall apply to property divided or to be
divided into condominium only if a Master Deed has been recorded in the
Register of Deeds of the province or city in which the property lies, and
duly annotated in the corresponding certificate of title of the land, if the
latter had been patented or registered under either the Land Registration
or Cadastral Acts.
Evidence of ownership – In house and lot, evidenced by original or
transfer certificate of title while in condominium, ownership is evidenced
by condominium certificate of title (ownership of a condominium unit
issued by the Register of Deeds of the city or municipality where the
condominium project is located).
Capacity to buy – In house and lot, or lot only or townhouse, alien
acquisition is not allowed. In the condominium concept, alien ownership
not to exceed 40% interest in the project is legally allowed.
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Extent of ownership – the interest of the owner in house and lot
consists of absolute ownership of the inner and outer structures of the
building (the entire building). In the condominium concept, the unit
owner is the absolute owner of the space within the interior surface of
his unit, but is only a co-owner of the exterior or façade of the unit
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STEPS IN FORMING CONDOMINIUM
1. Preparation of a Master Deed with Declaration of Restrictions and
registration with the Registry of Deeds for annotation in the title.
2. Organization of a condominium corporation with the project owners
as incorporators.
3. Causing issuance of individual tax declarations and condominium
titles for the units and common areas from the Assessor’s Office and
the Registry of Deeds respectively.
4. Execution of Deed of Conveyance on the land and common areas in
favor of the condominium corporation.
5. Application for registrations with the Housing and Land Use
Regulatory Board (HLURB).
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CONTENTS OF A CONDOMINIUM MASTER DEED
1. Description of the land including survey plan
2. Description of the building/s, enclosing technical and diagrammatic
plans.
3. Description of the common areas and facilities
4. Deed of registration
5. Certification of the registered owner of the property if it is other
than the one executing the Master Deed, that he consents of the
registration of the deed.

Note: The enabling or master deed may be amended or revoked upon

registration of an instrument executed by a simple majority of the
registered owners of the property. (RA 7899 Amending Secs 4 and 16
of RA 4726)
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Sec. 19. Where the enabling or master deed provides that the land
included within a condominium project are to be owned in common by
the condominium owners therein the Register of Deeds may at the
request of all the condominium owner and upon surrender of all their
condominium owner’s copies, cancel the certificate of title of the
property and issue a new one in the name of said condominium
owners as pro-indiviso co-owners thereof.
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CONTENTS OF A DECLARATION OF RESTRICTION
1. Formation of the condominium corporation, the project’s
management body.
2. Procedures and guidelines on maintenance of units and common
areas.
3. Rules and restrictions on the occupancy and usage of units and
common areas.
4. Provision for insurance coverage.
5. Realty taxes and assessments on units and common areas.
6. Right of assignees, mortgagees, tenants and occupants of the units.
7. Provision for assessments and fees.
8. Penalty provisions.
9. Procedures in amending restrictions.
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CONVEYANCE (Sec 18)
Requisites:
1. A copy of the description of land
2. Brief description of condominium conveyed
3. Name and personal circumstances of the condominium owner

Upon registration and payment of fees of an instrument

conveying a condominium, the Register of Deeds shall enter and
annotate the conveyance on the certificate of title covering the land
included within the project. Transferee is then issued a “condominium
owners” copy of the pertinent portion of such certificate of title.
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In case of condominium project registered under the
provisions of the Spanish Mortgage Law or Act 3344 as amended, the
registration of the deed of conveyance of a condominium is sufficient if
the Register of Deed has the original or signed copy, together with the
certificate of the management body of the project. A copy of said deed
of conveyance will be given to the condominium owner duly
acknowledged and stamped by the Register of Deeds in the same
manner as in the case of registration of conveyance in accordance with
the provisions of the declaration of restrictions of such project.
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DISSOLUTION OF A CONDOMINIUM PROJECT
Term of corporation – the life of the condominium corporation shall
be co-terminus with the existence of the condominium project and the
registration and regulation of the condominium corporation shall be
vested to the Housing and Land Use Regulatory Board (Sec 11).

As per Building Code, a building has a life of 50 years subject to an

extension of another 25 years upon issuance of the soundness of its
structure.
Note: A condominium corporation shall not, during its existence, sell,
exchange, lease or otherwise dispose of the common areas owned or
held by it in the condominium project unless authorized by the
affirmative vote of a simple majority of the registered owners (RA
7899 Amending Secs 4 and 16 of RA 4726)
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EFFECTS OF VOLUNTARY DISSOLUTION: (SEC 12)
a. The corporation shall be deemed to hold a power- of-attorney
from all unit owners/ members to sell their separate interests in
the project. (Sec 15)
b. Liquidation of the corporation shall be effected by the sale of the
entire project subject to the rights of the corporation and
individual creditors. (Sec 15)
c. The common areas held by the corporation shall be transferred to
the unit owners in the proportion to their interests. (Sec 19)

Effects of Involuntary Dissolution:

The transfer shall be deemed full liquidation of the interest of
the members in the corporation.
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SOME ADVANTAGES OF CONDOMINIUM OWNERSHIP

• Enhances affordability
• Accessibility to the amenities of the metropolis.
• Better security
• Maximizes land efficiency
• Lesser cost of facilities, services and maintenance
• Privacy