Top court rules building owners own residential parking lot

The Court of Final Appeal has upheld a lower court ruling that parking lots declared as common parts of a building are owned by all owners within the premises.

The story started when a residential building built in 1989 which had individual ownership registered in 1992 – hereinafter referred to as M Garden – saw its parking spaces illegally rented out by the security and management company, Company Y, from 2002.

M Garden’s owners’ administrative committee filed a lawsuit against the act, stating that Company Y had neither sufficient proof nor approval from the committee before conducting the act. Before seeking a judicial resolution, in 2003, the committee ordered Company Y to return the rights to the parking lot to it, but the company declined.

The Court of First Instance referred to the building manuals and noted the parking lot was registered as a common section pursuant to Clause 2, Article 1421 of the then promulgated Civil Code.

As a result, whether under the then enacted Civil Code or Items i and j, Clause 1, Article 1324 of the current Civil Code, the parking spaces concerned ought to be seen as a common part of the building, which would mean all building owners have ownership of the parking lot.

More importantly, Company Y had been ruled in another lawsuit as not having commercial rights to the parking lot, and ordered to terminate its lease of the parking lot. Therefore, the ruling in that case had and should have precedence over this case.

The base court also ordered Company Y to pay the committee approximately MOP953,000 as compensation. If this is not honored, the company will have to pay additionally MOP6,500 per day until the former compensation is honored.

Disagreeing with the judgement, the company sought appeal from the Court of Second Instance – which ruled against it – and then the top court – which also ruled against it.