In a judgment of January this year, the Czech Supreme Administrative Court opened the way for apartment owners’ associations to again become a participant in joint zoning and building permitting procedures.
Article by: Kristina Mališová, Ondřej Sehnal
In its judgment 10 As 26/2021-50 of 21 January 2022, the Supreme Administrative Court (“SAC”) has made it possible for apartment owners’ associations (“HOA”) to again become participants in joint zoning and building permitting procedures within the meaning of Sec. 94k (e) of the Building Act (Act No. 183/2006 Coll., as amended), as long as certain conditions are satisfied. An amendment to the Building Act enacted in Act No. 350/2012 Coll. had struck HOA off the list of participants to proceedings, with the exception of cases in which the HOA itself is the building principal. The explanatory memorandum for the said amendment made it clear, among other things, that it was fair to remove the HOA from the circle of participants because individual apartment owners could still participate in the proceedings, so that – according to the authors of the amendment – leaving the HOA as a party to proceedings in the Building Act was obsolete.
In the case brought before the SAC, three HOA had brought joint objections against a decision by way of which the building office had greenlighted a building project for an apartment building. The building office however did not deal with the objections brought by these three HOA, representing apartment buildings adjacent to the project land, on grounds of its assessment that the HOA could not have party status. The three HOA appealed to the Magistrate of the City of Pilsen (“City Hall”), but their appeal was struck down as inadmissible: City Hall shared the view that the HOA could not have party status, with reference to the above-mentioned amended Section 94k of the Building Act. The three HOA proceed to file administrative action with the competent Regional Court which finally accommodated the HOA, expressing inter alia the view that while the Building Act in the applicable wording did not expressly stipulate a participation of HOA in joint zoning and permitting procedures (in contrast to the previous legal arrangement in force until 31 December 2012), an HOA should nonetheless be granted standing in the proceedings if the joint permit is apt to affect the common parts of neighboring real property under the management of such association. City Hall in turn filed a cassation complaint against the Regional Court’s judgment, but was defeated. The Supreme Administrative Court sided with the legal opinion of the Regional Court as to the possible participation of HOA in joint zoning and building permitting procedures, as long as certain conditions are fulfilled. The SAC did concede that the explanatory memorandum on the amendment does not expect HOA to be a party to zoning or building permitting procedures, but held – quite logically, from our point of view – that the courts are bound by the letter of the law, as opposed to the language of explanatory memoranda for bills of law. In its decision, the SAC was clearly driven by the desire to help remove ambiguities created by the abolition of the special provision concerning HOA.
Having said all that, the SAC went on to say that neither it nor the Regional Court was in a position to be the first to address the question. It is thus upon City Hall to newly review the objections brought by the claimants, strictly on their substance, and then to assess whether these objections satisfy the criterion of common parts in adjacent real property (under the management of the HOA) being directly affected, in which case they have the power to give rise to party status for the welfare of the claimants in the joint proceedings.
In closing, we need to stress that the above-described ruling requires heightened attention on the part of all those who seek the issuance of a joint permit or who contemplate acquiring a project for which such joint permit has already been issued. If the HOA in such cases was not served the relevant decision, it could qualify as a passed-over participant; such a person – a participant who was not served the relevant decision by the administrative body – may file an appeal within 30 days from the day on which it learned of the issuance of the decision and the resolution of the matter which was the subject matter of the decision (though no later than within one year from the day on which the decision was served on the last of the participants). Our firm will gladly arrange for the necessary in-depth review (project due diligence) and determine whether there exists the risk of a passed-over participant.
Judgment 10 As 26/2021-50 of 21 January 2022
Explanatory memorandum for the amendment bill to the Building Act, enacted as Act No. 350/2012 Coll.