Buying a French Property: Increased Information Rights for Purchasers?

If you decide to buy a property in France, as a potential purchaser, you could be worried with the quantity and quality of the information provided regarding your dream property. French law ensures full information disclosure notably by property surveyors (“diagnostiqueurs”) who have to produce reports on the potential presence of asbestos, on the risks of natural disasters, etc… But, what if a property surveyor prepares an inadequate report with erroneous information?

In a judgement delivered on the 7th of April 2016, the French Supreme Court increased a purchaser’s rights by increasing the liability of property surveyors for the provision of incorrect reports.

Information rights in the contract of sale

In France, there are different forms of contract for the sale of property. The most common forms are the ‘promise to sell’ (promesse de vente), the promise to buy’ (promesse d’achat) and the ‘contract of sale’ (compromis de vente).

The compromis de vente is a bilateral, binding contract by which the seller agrees to sell and the buyer agrees to buy the particular property upon the terms and at the price set out in the document.  The compromis de vente, in the form of a notarial deed or under seal, binds the parties at a much earlier stage than the English form of contract for the sale of land.

Once all conditions are met, the deed of sale (‘acte authentique’) has to be signed otherwise a court order can compel the infringing party to execute the contract and award damages. This is similar to our ‘specific performance’. The compromis de vente is a binding property contract, it must contain all available information for the buyer at that stage.

French law also requires compulsory property inspections (‘diagnostics’) to be produced and attached to the compromis de vente. This then forms part of the binding contract. Reports are contained in a ‘Technical Diagnosis File’ (Dossier de Diagnostics Techniques), as required by a law passed on the 24th of March 2014.

This file must contain reports on the following: on energy performance, the presence of lead, the presence of asbestos, the electricity system, the gas system, and when relevant on natural disasters’ risks, the presence of termites and the septic tanks. Purchasers are entitled to have accurate information on all these areas.

Information rights and inspectors’ liability

What if the information in the surveyors’ reports is inaccurate? What can the purchaser do? The Supreme Court’s judgment of April 2016 has interestingly given the purchaser increased safeguards with respect to potential errors or incomplete information.

In this case, a property surveyor delivered a report alerting the buyer to the presence of asbestos in some areas of the property. Six years later, in light of a new transaction, the owner has asked for a new report, which then concluded that asbestos was present in other areas of the property. The owner sued the surveyor for damages equal to the costs of unexpected and additional works of removal and reparation.

An appeal court rejected the owner’s claim on the ground that he did not evidence the causality link between the two reports’ differences and the damage he suffered.

The Supreme Court overturned this judgement and concluded that the surveyor had failed to comply with his statutory obligations at the time of writing the first report. The causal link between the failure of the surveyor to produce a correct report and the owner’s prejudice ‘ipso facto’ exists, according to the Supreme Court.

Therefore, any error made by property surveyor makes him liable to pay damages to the extent of the additional works and not only for the missed opportunity of not having bought the property at the lower price (see French Supreme Court’s case law such as Cass. mixte 8-7-2015 no 13-26686; Cass. 3e civ. 15-10-2015 no 14-18.077).

The Supreme Court therefore established an automatic link between the report’s mistakes and the purchaser’s prejudice. This judgment renders the surveyor automatically liable and is aimed at maximizing the chances and the extent to which individuals can be compensated for incorrect information, by making a claim against the surveyor’s indemnity insurance.

Delivering full and correct information is crucial to secure the best deal for your next property investment in France.

Contact the French Desk of the Kobalt Law LLP with its offices in London and France to resolve your claim against a surveyor and to guide to safely to your property purchase.

Maître Aurelien Portuese, French Qualified Lawyer (“Avocat”), French Desk Kobalt Law LLP, London & French Offices, www.kobaltlaw.co.uk ,+44 (0) 207 749 3209 

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