55-469 - Conveyance or encumbrance of the cooperative. - Virginia Statutes

§ 55-469. Conveyance or encumbrance of the cooperative.

A. Part of the cooperative may be conveyed, and all or part of thecooperative may be subjected to a security interest by the association ifpersons entitled to cast at least eighty percent of the votes in theassociation, including a simple majority of the votes allocated tocooperative interests not owned by a declarant, or any larger percentage thedeclaration specifies, agree to that action. If fewer than all the units orlimited common elements are to be conveyed or subjected to a securityinterest, then all the proprietary lessees of those units, or the units towhich those limited common elements are allocated, must agree in order toconvey those units or limited common elements or subject them to a securityinterest. The declaration may specify a smaller percentage only if all of theunits are restricted exclusively to nonresidential uses. Proceeds of the saleare an asset of the association.

B. An agreement to convey a part of the cooperative or subject it to asecurity interest must be evidenced by the execution of an agreement, orratifications thereof, in the same manner as a deed, by the requisite numberof proprietary lessees. The agreement must specify a date after which theagreement will be void unless recorded before that date. The agreement andall ratifications thereof must be recorded in every city or county in which aportion of the cooperative is situated, and is effective only uponrecordation.

C. The association, on behalf of the proprietary lessees, may contract toconvey a part of the cooperative or subject it to a security interest, butthe contract is not enforceable against the association until approvedpursuant to subsections A and B. Thereafter, the association has all powersnecessary and appropriate to effect the conveyance or encumbrance includingthe power to execute deeds or other instruments.

D. Any purported conveyance, encumbrance or other voluntary transfer of thecooperative, unless made pursuant to this section or pursuant to subsection Cof § 55-454, is void.

E. A conveyance or encumbrance of the cooperative pursuant to this sectiondoes not deprive any unit of its rights of access and support.

(1982, c. 277.)