Co-ownership association, housing maintenance office, or private manager: who should residents entrust their building to, and how to avoid double billing

The question of exactly who to entrust with managing an apartment building goes far beyond everyday discussion: the chosen form of management determines the legal rights of residents, the quality of services, and, ultimately, the size of their utility payments. In a comment to RBC-Ukraine, head of the civil law and procedure committee of the Association of Lawyers of Ukraine and head of a law firm, Tatyana Danilenko, explained that practice shows apartment owners do not fully understand that preserving property requires care not only at their own door but also in common areas. It is at this stage, she said, that the key question arises — who to entrust the building's management to.

Who is a "manager" and what forms of management exist

The lawyer reminded that under Ukraine's Law "On Housing and Communal Services," every apartment building must have a manager. This can be either an external company or an organization created by the residents themselves. According to the definition in the Law "On the Specifics of Exercising the Right of Ownership in a Multi-Story Building," a manager is an individual entrepreneur or a legal entity engaged in business activity that, under a contract with the co-owners, ensures the maintenance of the building. Danilenko separately clarified that a housing maintenance office (ZhEK) is a legal entity, typically acting as a structural unit of a district management company for housing stock maintenance.

Co-ownership association (CoA): why co-owners are moving away from housing maintenance offices

In the assessment of housing and communal services experts, a co-ownership association of a multi-apartment building (CoA) has a number of advantages over other legal forms of management. The lawyer noted that an increasing number of complaints from residents are linked to the inefficiency of housing maintenance offices in performing their duties for building upkeep: managers may go years without carrying out repairs, while communication networks wear out and become unfit for operation. "People are gradually moving away from housing cooperatives and management companies and creating co-ownership associations to put order in the building and decide for themselves how to spend the money," Danilenko reported. In a CoA, residents jointly make decisions on building management, and the list of services — timely repairs, a well-maintained surrounding area, lighting, elevators, engineering networks — is set by law and additionally agreed upon in the contract.

Private management companies and housing construction cooperatives: who sets the fees

A private management company, in turn, provides professional management and maintenance services, taking on all the obligations. The foundation of its activity is Ukraine's Law "On Housing and Communal Services," under which co-owners receive services from the managing company. Management companies and housing construction cooperatives (HCC) independently set the size of contributions and compile the list of repair works based on an estimate. The creation of a CoA, the lawyer said, is especially relevant when the building, stairwells, roof, entrances, or elevators are in poor condition, or when the surrounding area is cluttered or abandoned. At the same time, Danilenko emphasized that a CoA can be created only by the owners of apartments and non-residential premises in a multi-apartment building.

How to change the manager and avoid double billing

When initiating a transition, owners often face resistance from the current housing maintenance office or private management company. The lawyer warned of an important legal nuance: concluding a contract with a new manager does not automatically terminate the contract previously concluded between the housing maintenance office and each co-owner. In such a situation, she said, double billing for building maintenance may arise. Therefore, to avoid legal conflicts, the manager should be chosen through a meeting of the co-owners. An illustration of the day-to-day work of improving the surrounding area is, for example, whitewashing tree trunks in courtyards — one of the typical tasks for which, in the end, either the CoA or the hired management organization is responsible.

Contradictory data

In the expert comment on which the article is based, the CoA is positioned as the preferable and most resident-controlled form of management, and the transition to it — as a conscious choice of owners. However, in the public sphere, a different trend is simultaneously being discussed: a number of publications (in particular, kp.ua) raise the issue of possible legislative pressure toward imposing management companies on apartment buildings, while focus.ua records a rise in tariffs that ends up in residents' bills. Thus, readers may form a contradictory picture: on the one hand — lawyers' recommendation to create CoAs for independent control of expenses, on the other — reports of trends toward centralized management and rising payments. It is important to take this divergence of signals into account when making a decision, because the actual legal situation in each specific building is determined by the existing contracts and the decisions of meetings, not by general trends.