The Condo Juristic Person, Explained: The Counterparty You Keep

Foreign buyers research the ownership rule, the transfer costs and the building. Almost nobody researches the entity they will be dealing with every month for the next fifteen years. The Condominium Act sets out what that entity is, what it must do, what an owner pays it, which decisions need a vote of the owners and what documents an owner is entitled to see. All of it is written down and most of it is readable before you make an offer. The two documents the same office produces at a transfer are the debt-free certificate and the foreign quota letter.

What Is a Condominium Juristic Person Under Thai Law?

Section 33 of the Condominium Act B.E. 2522 is the definition. A juristic condominium duly registered has the status of a juristic person, with the objectives of managing and maintaining the common property and the power to do any act for the benefit of those objectives, in accordance with the resolutions of the joint owners under the Act. The Thai term is nitibukkon akhan chut (นิติบุคคลอาคารชุด), and English paperwork uses juristic person, juristic office and condominium corporate interchangeably for it.

Two parts of that sentence set everything that follows. The entity is a person in law, so it holds rights and obligations in its own name rather than through the developer or any individual owner. And its objectives are defined and limited: it exists to manage and maintain the common property, which Section 15 defines across eleven heads — the land, the frame structure, the equipment and machines for mutual use, the common facilities and services, the juristic person's own office, and the security and environmental systems inside the condominium.

Who Is the Manager, and Who Appoints Them?

Section 35 provides for one manager, who may be a natural person or a juristic person; where the manager is a juristic person, that juristic person appoints an individual to act for it in the capacity of manager. Section 35/1 sets the qualifications, starting with a minimum age of twenty-five. Section 35/3 sets out how the office is vacated: death or the ending of juristic-person status, resignation, expiry of the employment agreement, disqualification, or a resolution of the general meeting to remove.

The appointment sits with the owners, not with the developer in perpetuity. Section 49 requires a resolution on the appointment or removal of the manager to receive votes of not less than one fourth of the joint owners' total votes.

Section 36 sets the powers and duties, and one of them is worth memorising because it is the one a buyer can verify with their own eyes. Under Section 36(5) the manager arranges for a monthly receipt-and-expenditure account to be prepared and posted on the bulletin board within fifteen days from the end of the month, and that posting stays up for at least fifteen consecutive days. Section 36(6) adds the duty to sue for compulsory performance from an owner whose Section 18 expenses are overdue by more than six months.

What Records Does the Juristic Office Keep on Foreign Ownership?

The register of who owns what, unit by unit, is what lets the building state its foreign-held position at any moment. That position is what the foreign quota letter reports, and it is the reason the number worth having is the one the juristic office puts in writing rather than one quoted in conversation.

The rule the register is measured against is Section 19 bis, which caps aggregate foreign-held ownership at 49% of the area of all units in the condominium taken together. Section 19 ter puts the duty to declare the existing proportion on the transferor at registration. The full mechanics are on the Section 19 page, and what the letter itself looks like is on the quota letter page.

What matters here is the sequence. The register is a live thing; it changes with every transfer the building registers. A statement of the foreign-held area is a statement as at a date, which is why the useful question is not is there quota but what is the position today and what is in progress. Ask for it in writing, with a date on it.

How Does an Owner Obtain the Foreign Quota Position for a Building?

By requesting it from the juristic person, in writing, before the transfer appointment is fixed. The office holds the register; nobody else is in a position to state the number from it.

That request usually travels with a second one. Section 29 conditions the registration of a right or juristic act on a unit on the unit being free from liabilities arising from the Section 18 expenses, evidenced by a letter of certification from the juristic person, which the manager issues within fifteen days of the request once the owner has paid. Two letters, one office, one appointment. Make the transfer conditional on the seller producing both, and make the deposit returnable if either is not produced. The step-by-step sequence sits in the buying process page.

What Does the Juristic Person Charge, and What Is the Sinking Fund Used For?

Section 40 sets out what owners pay the juristic condominium for carrying on its business: the expenses of the juristic condominium, which the owner of each unit pays in advance; a fund on starting to do anything under the regulations or under a resolution of the general meeting; and other monies for carrying out a resolution of the general meeting on the conditions the meeting prescribes. The second of those is what English-language paperwork calls the sinking fund.

Section 18 sets who owes what. Joint owners share the tax and duty in accordance with their ratio of ownership in the common property under Section 14, and share the expenses of common services, of the equipment and facilities for common use, and of the maintenance and operation of the common property, on that same ratio or on the portion of the advantage received, as the regulations provide.

Section 18/1 handles late payment. A joint owner who fails to pay within the prescribed time pays a surcharge at a rate not exceeding twelve percent a year of the amount unpaid, without compounding, as the regulations provide. Where the arrears run six months or more the ceiling rises to a rate not exceeding twenty percent a year, and the regulations may also provide for suspension of common services or use of common property and for the loss of the right to vote at the general meeting. The surcharge itself is deemed to be an expense under Section 18, which is why it forms part of what the debt-free certificate has to be clear of.

For what the monthly charge actually runs, per square metre, in a real market, see the service charge page, and for how the fund behaves over a holding period, the sinking fund page.

What Is the Committee, and What Decisions Need an Owners' Vote?

Section 37 provides for a condominium committee of not fewer than three and not more than nine members, appointed by the general meeting, holding office for two years a term and re-appointable but not for more than two consecutive terms unless no other person can be found. The manager registers the appointments with the competent official within thirty days of the resolution.

Section 38 gives the committee its functions: monitoring and controlling the management of the juristic condominium; appointing a member to assume the manager's duties where there is no manager or the manager cannot perform normal duties for more than seven days; and meeting at least once every six months.

The voting architecture is set out across four sections and is worth knowing before you own a unit, because it decides what can happen to a building without your agreement.

1. Quorum, Section 43. A general meeting needs attendees holding not less than one fourth of the total votes. Where that is not met a new meeting is convened within fifteen days of the previous convening, and the later meeting is not held to the quorum requirement. The manager and the manager's spouse are prohibited from chairing.
2. Ordinary resolutions, Section 44. A majority of the votes of joint owners attending the meeting, unless the Act provides otherwise.
3. How votes are counted, Section 45. Each owner votes according to their ratio of ownership in the common property. Where one owner holds more than half the total votes, that number is reduced to equal the total votes of all the other owners combined.
4. The heavier decisions, Section 48. Not less than half of the total votes of all joint owners for matters including buying or accepting a gift of real estate as common property, disposing of common property that is real estate, permitting an owner to build or alter their unit in a way that affects the common property or the external features of the building, altering the regulations on the use or management of common property, altering the ratio of common expenses in the regulations, construction amounting to a change or addition to the common property, and arranging for exploitation of the common property. Where the attendance for that is not met, a new meeting is summoned within fifteen days and the resolution then needs not less than one third of total votes.

What Should a Buyer Read in the Accounts Before Purchase?

More than most buyers realise is available, because the Act requires it to exist and to be kept where owners and the competent official can review it.

1. The audited balance sheet. Section 38/1 requires the juristic condominium to prepare a balance sheet at least once every twelve months, containing the amount of properties and liabilities and the receipt-and-expenditure account, audited by an auditor, and submitted to the general meeting for approval within one hundred and twenty days from the end of the accounting year.
2. The annual report. Section 38/2 requires an annual report showing the operational result to be submitted to the general meeting together with the balance sheet, with photocopies forwarded to joint owners at least seven days before the meeting.
3. The ten-year file. Section 38/3 requires the annual report and balance sheet, together with the regulations, to be kept at the juristic condominium office for review by the competent official or joint owners, and retained for not less than ten years from the date the general meeting approved them.
4. The monthly account. Section 36(5) has the manager post a monthly receipt-and-expenditure account on the bulletin board within fifteen days from the end of the month, displayed for at least fifteen consecutive days. That one you can read on a viewing.

That set is the closest thing a foreign buyer gets to a financial statement for the asset they are buying into, and I have never once seen a listing mention it. It is also free.

What Happens to the Building Fund When It Runs Low?

The Act provides defined mechanisms rather than leaving it to improvisation, and they run in two directions.

On the income side, Section 40 is the route: owners pay the expenses in advance, the fund on starting anything under the regulations or a resolution of the general meeting, and other monies for carrying out a resolution on the conditions the meeting sets. A top-up or a special levy therefore takes a resolution, and altering the ratio of common expenses set in the regulations is on the Section 48 list requiring not less than half of the total votes.

On the collection side, Section 36(6) puts a duty on the manager to sue for compulsory performance where an owner's Section 18 expenses are overdue by more than six months, and Section 18/1 applies the surcharge described above. Section 41 then gives the juristic condominium preferential rights for debts arising from Section 18 expenses, of the same nature as those under Sections 259(1) and 273(1) of the Civil and Commercial Code, and provides that where the manager has duly submitted the description of debt to the competent official, the second of those ranks ahead of a mortgage.

What that means for a buyer is a practical test rather than a judgement about anybody. Read the fund balance against the age of the building and the equipment on Section 15's list — lifts, pumps, the water and waste systems, the fire and air-conditioning plant. A fund that is thin relative to what is due for replacement is not a scandal. It is a future resolution, and a future resolution is a future cheque with your unit's ratio written on it.

Which Questions Are Worth Asking at the Juristic Office Before an Offer?

Six, all answerable from documents the Act requires to exist, all askable in one visit.

1. What is the foreign-held proportion today, in writing, with a date? That is the number measured against the Section 19 bis ceiling, and it decides whether your name can go on the title at all.
2. What does this unit owe, as at today? The Section 29 certification is the transfer gate. Knowing the number early converts a surprise into a line in the contract.
3. May I see the last audited balance sheet and annual report? Sections 38/1 and 38/2 require both. Section 38/3 requires them to be kept at the office for review, for ten years.
4. What is the current fund balance and what has it been spent on? The fund is the Section 40(2) money. Its balance against the age of the plant is the single most useful number in the building.
5. What is the monthly charge per square metre and when was it last changed? Changing the expense ratio in the regulations is a Section 48 matter. A change needs a meeting, so there is a record of it.
6. May I read the regulations? Section 32 sets what they contain. They govern pets, letting, renovation, and the suspension rules Section 18/1 permits for arrears.

Ask all six and you will know more about the building than any listing for it will ever tell you. None of these questions is adversarial and none of them implies anything about anybody. They are requests for documents the Act requires the office to produce and keep, and an office that keeps them well is exactly what you want behind a unit you are about to own for fifteen years.