We use cookies

Moalem Weitemeyer uses cookies, including cookies from third parties, needed to make the website work and to enhance the user experience. Cookies are also used to detect inexpediencies and to examine your interactions with our website. Read more about how we use cookies and take care of your data here

Necessary/functional

Statistical

Accept

9 February 2022

The Eastern High Court's Judgment in the Cooperative Housing Association's Breach of a "Subsidy Declaration"

Group 7 Created with Sketch.
Download PDF version
Introduction

Several cooperative housing associations in the greater Copenhagen area are subject to a so-called “subsidy declaration” due to the associations having received partial public funding in connection with the construction of their real estate (typically executed in the 1920s). 

The declaration is registered as a burden on the real estate of the associations with the Municipality of Copenhagen (“the Municipality”) as the creditor entitled to enforce the declaration. The declaration provides that the Municipality may claim the transfer of the “profit” arising from any sale of shares in the associations or from the sale of the real estate of the association. The declaration contains a particular definition of what constitutes a “profit” for these purposes.


Contrary to the standard regulation in the Danish Cooperative Housing Association Act, the declaration does not fix any mandatory maximum price applicable to the sale of shares in the associations, nor does it grant the buyers of such shares any excess repayment right against the sellers. 


This complex regulation has given rise to a long-standing dispute between the Municipality and a significant association, Andelsboligforeningen København & Omegn (“ABKO”), which has so far been tried 3 times by the Eastern High Court and once by the Supreme Court.


The core subject of the latest dispute between the parties concerned whether the Municipality had a direct payment claim or damages claim against ABKO due to ABKO having condoned certain sales of shares at an excess price (as calculated according to the declaration).


By its appeal judgment of 7 February 2022, the Eastern High Court has now ruled on the matter. In doing so, the High Court provides an important precedent with respect to the legal nature of the Municipality’s claims arising from an association’s breach of the declaration.

Thomas Weitemeyer

Managing Partner

+45 30 37 96 90

Go to profile

Thomas Mygind

Senior Associate

+45 30 37 96 58

Go to profile

The Latest

See all insights

24 June 2022

Updated ESMA Market Abuse Regulation Guidelines on the delay of Disclosure of Inside Information and Interactions with prudential supervision

10 June 2022

Kristoffer Lund Poulsen and Poul Guo/郭保罗 make partners at Moalem Weitemeyer!

25 May 2022

In Memoriam

4 May 2022

The Danish news media K-news has brought an article about Moalem Weitemeyer's recent 25% salary raise and improved bonus arrangements

29 April 2022

Moalem Weitemeyer has lifted all salaries with 25 % in addition to the firm's market-leading bonus

28 April 2022

New EU Legislation to make the Internet a safer Space for Users

24 April 2022

New Opportunities for foreign Shareholders to vote at General Meetings of Danish listed Companies

20 April 2022

New Legislation on stricter Requirements for Target Figures and Policies for the Underrepresented Gender

12 April 2022

The Legal 500 ranks Moalem Weitemeyer as a Top Tier Law Firm

12 April 2022

Moalem Weitemeyer takes biggest leap  in the Q122 League Tables' Danish Top 5