The major change in the area of real estate law introduced by the new Civil Code (Act No. 89/2012 Coll., the “NCC”) is adoption of the principle applicable in most European countries, i.e. that a structure is considered to be a part of the plot of land on which it stands. This principle had been applicable in Czechoslovakia till 1950, when it had been replaced by the principle under which a plot of land and a structure are two independent objects with independent relations and as the case may be, two different owners. From now again, the owner of the structure (building) and the plot of land cannot dispose with the two properties independently and these can only be disposed with as one real estate property.
The new principle will not apply in cases when the owners of the plot and the structure are different; in such case the properties will remain as two independent legal objects. This diversity of ownership is not preferable and the NCC considers it only as a temporary solution and therefore also stipulates the following:
- a structure will merge with a plot of land and will cease to be an independent object when the ownership right to both real estate properties (structure and land) will be with the same owner (save for certain exceptions listed by the NCC, when the merge will not happen and the two properties will remain as independent objects although they will be owned by the same owner – Section 3060 of the NCC),
- the owner of a plot of land and a structure erected on that plot of land have mutual statutory pre-emption right, which also binds future owners of the real estate property(if not already applied before).
The above specified rule will not apply to temporary structures, including elements that are built in into the land or the walls of such structures. Temporary nature of a structure may be given by its character or a title on the basis of which it had been built. The NCC furthermore reserves separate ownership for machinery and other equipment that is merged with the real estate property and that is in the ownership of a different owner.
By: Jiří Spoust