When a residential part of a building becomes a hotel
The Supreme Administrative Court recently reviewed a case concerning unauthorised change of use of real estate. According to the construction permit it was supposed to be a residential part of a building, but was converted into rooms to be let.
Supreme Administrative Court judgment of 15 February 2018, II OSK 3220/17
The judgment in question is important for people considering changing the designated use of part of a building and using it in a manner other than originally intended.
The case related to use of a building, unauthorised change of the designated use of the building by the owner, and an inspection undertaken by the local construction inspector to restore original use of the structure.
Employee hotel in an extension
The Koszalin town mayor approved the construction design and issued a permit to investors to add a storey and extend a utility building by adding a residential section, with building installations. The owners carried out the building work and upon completion it was approved by the local construction inspector on the basis of documents filed by the investor.
Soon after that, local residents reported to the local construction inspector that rooms were being let to construction employees on the plot and in the converted building, and this was disturbing the owners of the residential buildings in the vicinity.
The local construction inspector commenced proceedings concerning unauthorised construction work performed by an investor, in the form of separation of four washing and cleaning areas in residential premises, on the first floor.
When inspecting the structures, the local construction inspector found that the utility building with the added floor for residential purposes housed six occupied rooms. The investor stated that they were let to businesses (employees resided in them occasionally) while each of the rooms had a bathroom (shower, toilet, and wash basin).
The local construction inspector examined witnesses, who confirmed that the owners regularly let the rooms. The floor of the building which according to the issued permit should be used for residential purposes, was designated for paid use by guests. The local construction inspector even collected in the case file print-outs of advertisements posted online for the rooms.
The local construction inspector concluded the proceedings and issued a ruling ordering that use of that part of the building be stopped and that specific documents relating to the change of designated use be submitted. As this obligation was not complied with, it ordered the owners of the building to restore the units on the first floor of the building to their previous designated use.
The owners appealed against the decision but the province construction inspector upheld the decision, ordering that the previous conditions be restored.
Case before the Province Administrative Court
The owners appealed to the administrative court.
The Province Administrative Court first overturned the contested decision and the first-instance decision. It stated that the grounds were that the facts of the case had not been sufficiently examined and it had not been established whether steps were needed to make the change of use legal.
In turn, this judgment was contested by the province construction inspector and the cassation appeal was successful. It was determined that the upper floor of the building in question had been formally designated for residential use and thus the letting of individual rooms could be classified as a change of use. As no filings had been made regarding the change, it might need to be legalised under art. 71a of the Construction Law.
In light of the Supreme Administrative Court judgment, when re-examining the case, the Province Administrative Court dismissed the owners’ appeal and concurred with the court of higher instance. The owners in turn appealed against that judgment in a cassation appeal to the Supreme Administrative Court.
Supreme Administrative Court: a residential dwelling and rooms to let are not the same thing
Reviewing the case and dismissing the cassation appeal, the Supreme Administrative Court expressed a view important in the context of the provisions under analysis. According to the ruling, “a change of use of a building as described in art. 71 section 1(2) of the Construction Law can be caused not only by construction works being carried out in a building, but also by a change to the manner in which it is used in practice”.
Considering that this provision was the basis for the proceedings in the case, the Supreme Administrative Court stated that there were three main issues from this point of view.
Firstly, the upper floor in the utility and residential building in question was designated for residential purposes as at the day on which the decision ordering the previous status restored was issued. Secondly, the work carried out by the owners did not change that original function of that part of the building.
The third issue, examined in an earlier judgment issued by the Supreme Administrative Court, but re-examined thoroughly in the judgment in question, was that a change of use of a building which needs to be legalised can occur not only through performance of the appropriate construction works, but also by changing the manner in which a building is used in practice. This by itself can mean that changes have to be made to ensure that it continues to be used safely.
The Supreme Administrative Court stated further in the statement of reasons that “on the basis of the collected evidence, the court of first instance, like the authorities of both instances, correctly assumed that the plaintiffs were not using the rooms located on the upper floor of the building as residential premises. They were being used for letting on an occasional basis to employees of construction crews. For this reason, the conditions of washing and cleaning facilities in the building should be evaluated in the manner appropriate for collective residential buildings”. The above amounted in practice to a change in the way the structure was used, and this was stated further: “Thus contrary to the statement of reasons for the cassation appeal, the court of first instance stated clearly that the commencing by the investors of hotel activity in their building was a change to the washing and cleaning conditions in the building. The authority of second instance noted in this regard that the letting of rooms to third parties had implications for fire safety conditions, and this is stated in art. 71 section 1(2) of the Construction Law”.
For the prerequisites for change of use of the structure to exist, the legalisation procedure had to be followed. The authorities did this and the Supreme Administrative Court sanctioned it, dismissing the cassation appeal.
Dr Maciej Kiełbowski, adwokat, Administrative Proceedings practice, Wardyński & Partners
