Cabinet Approves New Apartment Associations Bill (2)
The Cabinet approved a new law on apartment ownership and apartment associations that stands to affect half a million property owners.
The most important changes clarify the rights and obligations of apartment associations in such areas as liability to non-residents, such as when an icicle falls on a pedestrian or tenants fail to pay for utility bills.
In the case of liability for falling ice, the specific apartment owner currently has to pay the damages, and then seek reimbursement from other apartment association members. But in future, the association should be responsible, said Justice Minister Hanno Pevkur in a statement.
In the future, unpaid utility bills can be collected from a tenant also if a large mortgage were placed on an apartment.
An apartment association could seek foreclosure on such a "hypermortgaged" property under enforcement procedure. "This would result in the mortgage being extinguished, resulting in a greater sense of responsibility of flat owners to their neighbors as well as an increased circle of possible buyers," said Pevkur.
The legislation also provides an option for restricting the apartment association should it go bankrupt.