Austrian OGH on Resolutions by Owners’ Associations

Apr 25, 2025 Benn-Ibler Rechtsanwälte

The Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) ruled on the contestability of resolutions entered into by members of residential property owners’ associations.

In the case at hand, the plaintiff had acquired co-ownership shares in the property in question in 2019. The first respondent was the current manager; the respondents were the other co-owners and owners of individual flats.

The plaintiff sought the annulment or declaration of nullity of majority resolution by the flat owners’ association. A 1995 resolution of the owner’s association had authorised the then property manager to acquire a parcel of forest in his own name. A 2014 resolution had authorised the first defendant (the current property manager) to enter into a lease agreement with one of the neighbouring properties, with the owners’ association as the lessee. The neighbouring plot was to be used as a car park after the costly removal of underground pipes.

The court of first instance dismissed the application relating to the 1995 resolution, but upheld the application relating to the 2014 resolution. It found the operating cost accounts to be correct and proper in each case, with certain amendments, and completely deleted the ‘forest parcel’ items in each case. The court of appeal, however, did not allow the plaintiff’s appeal, sharing the legal opinion of the court of first instance.

The OGH, which was then consulted, emphasised the following:

The 1995 resolution of the owners’ association (by which the owners present at that meeting had authorised the manager to purchase a neighbouring property in his own name) has no bearing on the owners’ association and no effect. It cannot be considered to be a resolution, not even in appearance, so there is no reason to assume that it could be challenged indefinitely for reasons of legal certainty. The ‘resolution’ cannot therefore be challenged in non-contentious proceedings under Austrian housing law.

By contrast, the 2014 resolution of the owners’ association authorising the property management company to enter into a lease agreement for part of a neighbouring property was in the common interest of the owners. Not concluding the lease would have had a massive negative impact on the common interest, as it could have led to a reduction in the number of parking spaces. Such a decision is an administrative measure, which in principle can be decided by an owners’ association, and is a decision not exceeding the competence of the owners’ association, which could be challenged indefinitely in order to obtain legal certainty.

OGH 5 Ob 219/24b (6 March 2025)