Certain Issues on Legal Regulation of Non-Residential Premises Use

      1.  Pursuant to part 1, para. 1, Art. 130 of the Civil Code of RF ("the CC RF") immovable property (real estate, immovables) comprises land lots, subsurface areas, isolated water bodies, and everything that is closely connected with the land, i.e. the objects whose displacement is impossible without the damage incompatible with their designation, including forests, green plantations of many years, buildings, constructions . Pursuant to part 2, para. 1, Art. 130 of the CC RF another property may also be attributed to immovables.

      The Federal Law On the Statutory Registration of Rights to and Transactions with Real Estate ("the Law") (Article 1) attributes to the real estate, the title to which is subject to a statutory registration, land lots, subsurface areas, isolated water bodies, and all other objects whose displacement is impossible without the damage incompatible with their designation, including buildings, constructions, residential and non-residential premises, forests and green plantations of many years, condominiums, enterprises as property complexes. Hence, the Law extends the list of real estate and includes in it, along with buildings and constructions, also residential and non-residential premises.

      Pursuant to part 2, para. 6, Art. 12 of the Law, the premises (residential or non-residential) are "objects incorporated in buildings and constructions".

      Civil law gives other definitions of "non-residential premises", as well. Thus, the Federal Law On Partnerships of Accommodation Owners defines premises as a unit of an immovable property complex (part of an apartment house or another real estate object connected therewith), which is singled out in kind, intended for independent use for residential, non-residential, and other purposes, and owned by individuals or legal entities, the Russian Federation, subjects of the Russian Federation, and municipalities.

      Pursuant to the Law of Moscow dated 02.04.1997 On State Control Over Account for, Registration, and Use of Non-Residential Facilities in Moscow (Article 2), non-residential facilities are understood as located in Moscow separate non-residential buildings, constructions, and structures, parts thereof, as well as non-residential premises in apartment houses, including built-in and built-to ones, attics, basements, technical and other premises of a non-residential designation.

      The Law of Moscow dated 17.03.1999, No. 8, has amended the above rule, and currently non-residential facilities are understood as:

      -  separate non-residential buildings, constructions, structures, and their parts;
      -  non-residential premises in apartment houses and their parts, including built-in and built-to ones and their parts, as well as technical and other premises of a non-residential designation and their parts, excluding premises attributed to housing facilities in a prescribed manner.

      We believe that the change of the wording is due to enactment of the Law which uses only such notions as a building, construction, residential and non-residential premises and parts thereof.

      Therefore, non-residential premises are an immovable property object different from a building or a construction it is located in, though being inseparable from it. At the same time, it is characterized by isolation from other premises and by ability to be used separately.

      2.  Registration of the rights to non-residential premises may be verified in the Moscow Committee for Registration of Rights to and Transactions with Real Estate. Pursuant to para. 1, Art. 7 of the Law the statutory registration of rights is not confidential. The agency responsible for the statutory registration of rights is obliged to make available the information recorded in the Unified State Register of Rights to and Transactions with Real Estate about any real estate object to any individual who produces an ID and an application in writing (to a legal entity producing documents verifying its registration and the powers of its representative).

      Excerpts from the Unified State Register of Rights approved in a prescribed manner should describe a real estate object, registered rights thereto, and restrictions of (charge on) the latter.

      The agency responsible for the statutory registration of rights must either provide the applicant within five days with the information requested or deliver a written motivated refusal to do so. Such refusal may be appealed against in court by the person who has applied for the information.

      Additional information about persons - owners of the premises in the building may be obtained in the Bureau of Technical Inventory (the BTI) which keeps a technical passport containing characteristics of the building and information about the right holders, and floor plans with explications. The data of the BTI is the data of technical account and may differ from the data of the Moscow Committee for Registration of Rights to and Transactions with Real Estate.

      3.  In case an owner of the premises of the building wants or has to obtain the other owners' consent to undertake construction in the building, he should proceed from the following.

      The procedure of construction on the territory of Moscow is established by the Decree of the Moscow Mayor dated 11 April 2000, No. 378-RM On the Provision of the Uniform Procedure of Pre-Project and Project Preparation for Construction in Moscow.

      The above Provision determines the procedure of investment and construction - from application to Moscow authorities up to obtaining a permission (order) for construction and assembly, and earthwork of all kinds, including reconstruction, re-planning, and re-equipment of premises. This Provision is to be followed by all those involved in these activities, irrespective of their forms of property and sources of finance.

      The pre-project and project preparation for reconstruction is regulated by Chapter II of the Provision setting forth: 1) requirements to the set of documents necessary to obtain a permission for reconstruction; 2) the procedure of pre-project preparation and approval of the documents; 3) the procedure of project preparation and approval of the project documentation.

      Pursuant to the Provision, the circle of persons who should approve the materials of pre-project studies, project and initial permissive documentation does not include the owners of the construction facilities subject to obtaining the permission to construct.

      Federal laws, in particular, para. 3, clause 2, Art. 3 of the Federal Law On Architectural Activities in the Russian Federation expressly provides for the necessity to obtain approval of the owner for a project of reconstruction. However, this rule concerns only an architectural project which pursuant to Art. 2 of the above-mentioned law means a building, construction, structure, a complex of buildings and structures, their interior, targets of improvement, landscape or a landscape architecture developed on the basis of an architectural project. An architectural project is a part of the construction and town-planning documentation containing architectural solutions which take into account a complex of social, economic, functional, engineering, technical, fire-prevention, hygiene and sanitary requirements, as well as ecological, architectural and art, and other requirements to the project in the scope necessary for development of documentation for project construction whose designing requires involvement of an architect.

      Therefore, if construction does not entail changes in the external architectural look of a building, the latter should not be regarded as an architectural object and its reconstruction does not require consent of other owners of the building as provided for by the Federal Law On Architectural Activities in RF.

      The lack of a uniform requirement to obtain other owners' consent for construction/reconstruction of non-residential premises is due to the fact that pursuant to Art. 209 of the CC RF an owner is entitled to perform with respect to his property any actions which do not run counter to law and other legal acts and which do not infringe the rights and lawful interests of other persons.

      Besides, unlike the premises of common use in apartment houses which are included in the common premises of the apartment houses and pursuant to Art. 290 of the CC RF belong to owners of the apartments pursuant to the right of common shared property, the use, for example, of an attic as a part of a non-residential building may not necessarily be connected with availability or lack of the rights to the building itself or its part.

      The legislator does not provide for the common property right to the premises of common use in the non-residential buildings. Therefore, legal acts do not expressly stipulate obligations of a person intending to use the attic, including for the purposes of reconstruction, to agree this with the owner/other owners of the building, which would be obligatory with respect to non-residential premises in apartment houses, proceeding from their legal status of the facilities of common shared property.

      However, in the event the actions connected with construction/reconstruction restrict or hamper other owners of non-residential premises in the building in exercising their powers with respect to their property, it would be possible to speak about infringement of the owners' rights. Consequently, if reconstruction affects the premises belonging to another person, it would be necessary to obtain the latter's preliminary consent to use his property. Accordingly, since only the owner of the premises on the uppermost floor has a technical possibility to use the premises of the attic without infringing the interests of other owners, the latter may use the same premises only with consent of the owner of the premises on the uppermost floor.

      Proceeding from the foregoing, it may be concluded that the person who has legal grounds to use the attic premises is entitled to reconstruct these without other owners' consent, provided such reconstruction neither infringes nor creates the opportunity to infringe the rights and lawful interests of other persons.

      4.  Regarding relations between the owners of the premises in the building with respect to the use of the land lot occupied by the building and surrounding it, it is necessary to take into account that the land lot is leased to the premises owners to enable them to use the territory for exploitation of the building premises.

       Since in this case the land lot is indivisible and the premises in the building are owned by several persons, pursuant to para. 1, Art. 36 of the Land Code of RF the lessee is represented by many persons who have the common right to use the land lot as a whole. In addition, determination of shares in the right of lease is important only for taxation purposes and distribution of costs of maintenance of the land lot.

      The law does not regulate the relations between the parties - lessees of one and the same land lot, with respect to its use included. In compliance with Art. 6 of the CC RF in those cases when the relations are not expressly regulated by law or agreement of the parties, nor there is a business custom which can be applied to such relations, civil law regulating similar relations will be applicable (analogy of law), unless this runs counter to the essence of such relations. By analogy of law the rules regulating the issues of common property may be applied to the relations concerned, since the matter under review involves a common lease right to the land lot. By virtue of para 1, Art. 247 of the CC RF, possession and use of the estate being a common shared property are exercised by agreement of all the proprietors, and in the event no agreement is reached - in a manner established by court.

      If to proceed from the above rule, one lessee should agree with other lessees the use for the construction purposes of the land lot necessary for exploitation of a building. In the event one of the lessees puts obstacles to construction, the possibility to use the land lot for the above purposes should be decided by court. In this case one of the proprietors may be recognized as having the right to use the land lot for construction, unless this impedes other proprietors' use of the land lot for exploitation of the non-residential premises they own.

      Another option would be allocation to such proprietor by competent authorities of the land lot for construction site. A construction site is a vacant land lot or a land lot occupied by buildings, allocated for a short-term use for value for the period of construction (reconstruction) in order to be able to carry out construction. However, if the land lot allocated for construction site occupies a part of the land lot leased, there may arise problems with other lessees, as well, who may put obstacles to using it as a construction site.