To publications there is a speech about problem questions of registration of real estate objects, especially objects of construction in progress and constructed autocratically (without appropriate permission).
Problem points of participation in a civil turn of objects of construction in progress
The concept "self-system" (autocratically constructed fast estate) is defined in article 376 of the Civil code of Ukraine (further – group of companies) as a real estate object which is constructed or under construction on the land lot which wasn’t taken away for these purposes or without appropriate permission, or properly approved project, or with essential violations of construction norms and rules.
The concept "unfinished construction" legislatively isn’t defined. In this article, proceeding from definition of the concept "self-system" and requirements to a real estate object, shown at its first registration, it is necessary to understand the object of the construction which is constructed or under construction on a site taken away for this purpose as an unfinished construction (object of construction in progress), according to the corresponding permission and the approved project, without violation of construction norms and rules, but not put in operation.
Why registration is necessary?
In a civil turn rather often there is a need legally to issue legal relationship concerning real estate objects which aren’t complete construction or aren’t registered properly. According to a part 6 of article 3 of the Law of Ukraine About the state registration of laws of estate on fast estate and their restrictions (The law on registration) transactions of rather fast estate are carried out, if the ownership right on this property is registered, according to this Law.
Similar provisions are fixed and in group of companies. So, in article 182 of the Code it is said that the ownership right and other laws of estate on immovable things, restrictions of these rights, their emergence, transition and the termination are subject to the state registration. And article 331 of group of companies establishes that the right sobstvennosti on the new created fast estate arises from the moment of completion of construction; if the contract or the law provided acceptance of fast estate in operation, the ownership right arises from the moment of acceptance in operation; if the ownership right is subject to the state registration, from the moment of such registration.
Part 2 of article 376 of the Code zakrepyoleno situation according to which the person which is carrying out or carrying out autocratic construction of fast estate, doesn’t get an ownership right on it. However parts 3 and 5 of specified article allow to find an ownership right on such property by a court decision at performance of certain conditions (will be considered below).
Thus, for acquisition of possibility to conclude transactions concerning objects both autocratic, and incomplete construction, the document confirming the state registration of its ownership right on such property is necessary for the owner.
Who and on what basis registers?
Registration of the rights to fast estate, according to article 7 of the Law about registration, local bodies of the state land cadastre should be engaged. By the order of the State committee of Ukraine on ground resources About creation of uniform system of the state land registration, fast estate and the rights to them … No. 135 from May 23, 2003 it is provided that such registration since January 1, 2005 is carried out by the state enterprise The center of the state land cadastre at the State committee of Ukraine on ground resources. However the specified situation still isn’t carried out.
Registration of ownership rights on real estate objects the municipal enterprises of bureau of technical inventory (BTI) still continue to carry out. Thus they are guided by point 5 of Transitional provisions of the Law on registration to which it is established that before creation of uniform system of bodies of the state registration of the rights, and also before formation of the State register of the rights as a part of the state land cadastre, registration of real estate objects is carried out by the BTI municipal enterprises.
Similar situation is fixed and in the joint order of Ministry of Justice, Gosyokomzem and the State committee on housing and communal services No. 15/5/44/39 questions from February 26, 2003 to which it is established that land registration and the rights to them will be carried out as a part of the State register of lands, and registration of real estate objects and the rights to them will be carried out in the Register of ownership rights on real estate. Functions of the manager of the Register of ownership rights on real estate are assigned to GP "Information center" of Ministry of Justice, functions of the registrar of the register are allocated for bodies of BTI. Besides, by the letter of the Ministry of Justice of Ukraine No. 19-32/1 from May 10, 2006 it is defined that before creation of uniform system of bodies of the state registration of the rights to fast estate their registration is carried out by bodies of BTI according to the Temporary provision on an order of registration of ownership rights on the fast estate, the approved order of the Ministry of Justice of Ukraine No. 7/5 from February 7, 2002.
The specified Temporary situation doesn’t provide possibility of the state registration of objects of incomplete or autocratic construction. Point 1.6 of Temporary situation directly says that registration are subject ownership rights only on real estate objects which are complete construction and are put in operation. Thus, standards of this Temporary provision in our case if can be used, only by analogy.
The question of use of analogy of the law can cause discussion. Need of the state registration of ownership rights on fast estate is fixed in group of companies. Article 8 of this Code provides possibility of use of analogy of the right and analogy of the law in civil legal relationship, but whether the relations of the conditional owner and BTI are civil?
In view of character and an essence of legal relationship of bodies of BTI and owners of fast estate, the answer will be more likely negative. Such relations by the nature are administrative. Point 7 of article 9 of the Code of administrative legal proceedings also predusmatrivaet possibility of use of analogy of the right and analogy of the law. However article 19 of the Constitution of Ukraine obliges public authorities and local self-government to operate only on the basis and within powers with the ways provided by the Constitution and laws of Ukraine.
Thus, justification of use by bodies of BTI of standards of the Temporary provision at registration autocratically constructed and unfinished by construction of fast estate is very problematic.
But as other existing regulations regulating these relations, no, and standards of Civil Code about registration of a self-system and an unfinished construction should be carried out, bodies of BTI nevertheless are obliged to carry out such registration and to do it on the basis of Temporary situation.
According to Temporary situation, registration is carried out on the basis of the following documents:
- state act of an ownership right or continuous using land lot, or lease contract;
- design and budget documentation;
- permissions to performance of the construction works, given out according to the Law of Ukraine About planning and building of territories inspection of the state architectural and construction control;
- inventories of object of construction in progress (BTI is made at carrying out inventory);
- the document confirming emergence of an ownership right on object of construction in progress (the contract construction podryada, the investment contract).
Ownership right registration on fast estate according to article 17 of the Law about registration predusmatrivaet delivery to the owner of the title document. Lack of the last interferes with implementation of real estate transactions – does impossible its participation in a civil turn.
How to register an unfinished construction?
Proceeding from the definition of an unfinished construction given by us, from the legal point of view two options of obtaining the title document are possible.
Option first. According to paragraph of 2 parts 3 of article 331 of group of companies, ownership right registration on object of construction in progress is carried out by the body which is carrying out the state registration of the rights to fast estate (BTI) on the basis:
a) the documents confirming an ownership right or usings the land lot for creation of object of fast estate;
b) design and budget documentation;
v) the documents containing the inventory of construction in progress.
As already it was told above, an order of such registration by regulations on the basis of which BTI work Yoorgana, it is not provided that Yovyzyvayet justifiable doubts in Yopozitivn Yoresheny of a problem. This way of registration of an ownership right on an unfinished construction is more convenient if there is no possibility to finish construction and to accept the house in operation.
In this case, having received official refusal of bodies of BTI, it is possible to appeal against it in court and to oblige BTI to register an ownership right on an unfinished construction. Considering a difference in validity of group of companies and subordinate regulations on the basis of which bodies of BTI, probability of satisfaction of such claim the high work.
Option second. In the presence of time and means for the completion of construction there is a possibility to register the ownership right on a real estate object by acceptance it in operation. The order is most accurately registered by Yotaka in the current legislation. So, article 19 of the Law of Ukraine About the state registration …, except the other bases, provides possibility of registration of the right of Yosobstvennosti on the basis of the acceptance report of fast estate in operation.
According to point 1.5 of the above-stated Temporary situation, obligatory registration the ownership right on fast estate of legal entities and individuals which is finished by construction is subject and is placed in operation, in the presence of materials of technical inventory ( point 1.6 of Temporary situation). Such inventory is carried out by bodies of BTI according to provisions of the Instruction about an order of carrying out technical inventory of objects of the fast estate, approved by the State Committee order on construction, architecture and housing policies of Ukraine No. 127 from May 24, 2001.
Real estate object acceptance in operation is made according to the corresponding Order approved by the resolution KMU No. 1243 from September 22, 2004, and the Law of Ukraine About architectural activity. Thus it is carried out by the state commission formed according to punkyoty 11 About.
About acceptance of object the relevant statement is drawn up. According to article 9 of the Law of Ukraine About architectural activity, the acceptance report should contain surely the signature of the architect – the author of the project. Without its signature the act is void. The act affirms body of the state executive authority or local government body which created the commission. After that the act is registered in inspection of the state architectural and construction control. The object is considered placed in operation from the moment of the adoption of the act of state commission ( Order point 29). On the basis of the specified act and materials of technical inventory bodies of BTI register an ownership right on object of fast estate and issue the title document in the presence of which the owner can dispose of property belonging to it.
How to register a self-system?
Proceeding from concept of a self-system, zakrepyolenny in the current legislation of Ukraine, the following problem points and, respectively, exit ways from current situation are possible.
1. Construction on the land lot not taken away for this purpose and not belonging to the builder (without appropriate permission or properly approved project as their receiving is connected with existence of the corresponding documentation on the land lot).
As it is told above, the right of a sobstvenyonost in that case can be acquired only by a court decision under condition of granting the land lot under already constructed property (according to article 14 of the Law of Ukraine About town planning granting the land lot under construction is carried out by local councils or their executive bodies).
In this case registration and issue of the title document on property is carried out on the basis of the relevant decision of court ( article 19 of the Law of Ukraine About the state registration of laws of estate on fast estate and their restrictions, the annex No. 1 to the Temporary provision on an order of registration of ownership rights on the fast estate, approved by the order of the Ministry of Justice of Ukraine No. 7/5 from February 7, 2002). Thus from the text of specified article of the Law clearly it is not visible, whether it is enough for registration of the right of a sobstvenyonost only one of the documents listed in it or it is necessary to provide all possible. In the latter case it is necessary to provide also the documents confirming an ownership right on the land lot (if the earth is provided in a property, instead of it is given out in using), and the acceptance report of fast estate in operation.
At the same time it is necessary to mean that, according to article 376 of group of companies if the owner of land objects to ownership right recognition for the person who has made autocratic construction on his earth, or it breaks the rights of other persons, such property is subject to demolition at the expense of the person which has constructed it. Besides, the ownership right on a self-system can be recognized for the owner of the land lot if it doesn’t break the rights of other persons. Thus, according to a part 6 of article 376 of group of companies, the person which has carried out autocratic construction, has the right to compensation of expenses on construction.
The law of Ukraine About responsibility of the enterprises, their associations, establishments and the organizations for offenses in the town planning sphere provides responsibility (in the form of a penalty) the builder for the violations allowed at construction. Thus payment of a penalty doesn’t release the enterprise from an obyazanyonost to eliminate the allowed violations and to pay the damages which have arisen owing to such violations. Besides, violation of construction norms in the cases provided by the legislation can cause administrative or criminal responsibility of guilty persons.
2. Real estate construction on belonging or being in using of the builder the land lot, but without appropriate permission or properly approved project, or with essential violations of construction norms and rules.
As we see, in this case the real estate or is constructed without manufacturing of all or a part of necessary documentation, or doesn’t correspond to available documentation.
According to article 24 of the Law of Ukraine About planning and building of territories, the construction license of object of town planning to the owner or the user of the earth stands out executive bodies of local councils. And one such permission yet doesn’t grant the right to the beginning of construction works – according to article 29 of the specified Law, permission to performance of construction works stands out inspections of the state architectural and construction control under the specific project of the builder.
Development of project documentation, construction and object delivery in operation are carried out including according to the Law of Ukraine About architectural activity. According to article 4 of the specified Law, these works should include surely development, coordination and the approval of design working documentation.
In case of total or partial absence of the specified documents ownership right registration on such fast estate without their manufacturing is very problematic for some reasons. To register such property as an unfinished construction, it is impossible due to the lack of all or parts of necessary documentation.
At the same time article 376 of group of companies predusmatrivaet two conditions of registration of an ownership right on a self-system:
1) granting the land lot (use of this point doubtfully because on sense of article construction should be carried out on another’s site and after it it is taken away under already constructed object);
2) on request of the owner (user) of the land lot ownership right registration on a self-system behind it (though from sense of point 5 of article 376 of group of companies follows that the owner (user) and the person who has made (making) construction – different persons).
In any of these cases the ownership right can be recognized only by a court decision, and the court at us, as we know, is guided by internal belief.
According to provisions of a part 7 of article 376 of group of companies, in case of essential evasion from the project that contradicts public concerns or breaks the rights of other persons, essential violation of construction norms and rules, the court in the claim of appropriate body of the government or local government body can make the decision which to oblige the person who has made (making) autocratic construction, to carry out the corresponding reorganization. If its carrying out is impossible or the builder doesn’t wish to carry out such reorganization, by a court decision this fast estate is subject to demolition at the expense of the person who has made (making) autocratic construction. For its account works on reduction of the land lot are carried out to an initial condition.
Proceeding from the current legislation, carrying out necessary reorganization eliminates discrepancy of a construction of available documentation and does possible its acceptance in operation, and consequently, and ownership right registration on such self-system.
As we see, a situation with ownership right registration on objects of incomplete and autocratic construction in our country quite difficult, though not desperate. Therefore they demands additional legal regulation.
(On newspaper materials Legal practice).