A. Daumani tn 18: short report and plan did not replace access to full documents

The association appealed against nullity of three written decision items due to lack of access to full financial documents.

Tartu Ringkonnakohus dismissed Narva linn, A. Daumani tn 18 korteriühistu’s appeal and upheld nullity of items 1, 5 and 13 of the decisions of 30 May 2020 concerning 2019 reporting, electricity rates and the 2020 management plan. Nullity means no legal effect from the outset. Rejection of the challenge to item 9 on replacing water risers was not appealed and, the court stated, had already become final. The decisions were adopted by written vote without a meeting. Two owners XX alleged lack of access to necessary documents. The association replied that a board report and work plan were placed in mailboxes, decisions were adopted by majority, and the audit report could be obtained. The circuit court accepted that the applicants could indeed inspect the audit report. But that did not cure the main defect: access to a legally compliant annual report and management plan was not ensured, nor were the place and procedure for inspection communicated. The brief documents distributed did not contain all the required information. In particular, the plan lacked projected utility volumes and costs; the board report did not replace a complete annual report. This prevented informed voting, including on electricity rates. The court explained that full documents need not be handed to everyone on paper: participants must be told how to inspect them. This also applies to written voting. The association’s argument that the applicants lacked financial knowledge did not limit their document rights. The first-instance costs allocation was retained: 80% to the association and 20% jointly and severally to applicants. Appeal costs were allocated to the association, with the amount set later.

Dismiss the association’s appeal and uphold the first-instance ruling. Allocate appeal costs to the association.