Newsletter n° 8 – Real estate law
Summary
LEGISLATION
LOCAL RENT OBSERVATORIES
Decree of November 5, 2014 – Order of November 10, 2014
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RENTAL VALUE OF HOUSING PREMISES
Order of December 18, 2014
JURISPRUDENCE
… of November 5, 2014
Absence of conformity of the statutes of a free trade union association
… of November 5, 2014
Voting methods during the appointment of the trustee
… of November 19, 2014
Limitation period applicable to the action for annulment of the mandate of trustee
… of November 19, 2014
General and special common areas: interest in acting
… of December 3, 2014
Reference to a fixed base index in an indexation clause
… of November 5, 2014
Derogation from the rules for recovering rental charges: heating costs
… of October 1, 2014
Modification of the distribution of charges following the change of use of a co-owned lot
… of October 15, 2014
Conditions for termination of the lease
… of November 26, 2014
Breach of the seller in his obligation to inform and liability of the notary
LEGISLATION
Rent Observatory
The Alur law provides for the creation of local observatories of rents (Art. 16 of law n°89-462 of July 6, 1989 tending to improve rental relations modified by the Alur law).
These observatories, created on the initiative of local authorities and inter-municipalities, are tasked with collecting data relating to rents in a given geographical area and making statistical results available to the public. Decree No. 2014-1334 of November 5, 20141, which entered into force on November 8, 2014, determines the terms and conditions under which the Minister responsible for housing issues or withdraws the approval of local rent observatories.
In particular, it specifies the form and content of the application for approval. These elements are also clarified by the decree of November 10, 20142, which sets the list of documents to be provided with the request. The decree conditions the issuance of the approval to several elements including:
- compliance with the methodological prescriptions defined by a committee, created by the decree, namely, the scientific committee for the observation of rents;
- the existence of a balanced representation of landlords, tenants and managers within the governing bodies of the observatory as well as the presence of qualified personalities in the field of housing or statistics.
Article 3 of the decree provides for the methods of communication of the data collected by the observatories to public and private persons. This article also provides for the annual publication of the observatory's results. This publication must take place before March 31 of each year (Art. 2 of the decree of November 10, 2014).
These results should show:
- the median and average level of rent at the scale of the agglomeration;
- the median and average rent level by geographical area;
- framework data on the housing stock observed;
- the main trends in the rental market if changes in rental levels are observed.
Rental value of residential premises
Article 74 of Law No. 2013-1279 of December 29, 2013 on amending finances for 2013 provides for an experiment in the revision of the rental values of residential premises and premises used for the exercise of a salaried activity at home is carried out in 2015.
The order of 18 December 20143 lists the experimental departments for the revision of the rental values of residential premises provided for in article 74 of the amending finance law for 2013.
1 Decree No. 2014-1334 of November 5, 2014 relating to local rent observatories, the procedures for communicating and disseminating their data and the creation of the Scientific Committee for Rent Observation 2 Order of November 10, 2014 relating to observatories rental premises and the procedures for communicating and disseminating their data
3 Order of December 18, 2014 setting the list of experimental departments for the revision of the rental values of residential premises provided for in article 74 of law n° 2013-1279 of December 29, 2013 on amending finances for 2013
The departments selected for the trial of the revision of rental values are:
- Charente-Maritime;
- the North ;
- the Orne;
- Paris ;
- the Val-de-Marne.
The rental value of each property or fraction of property is determined according to the state of the rental market.
It takes into account the nature, location and consistency of the property or fraction of property considered. The rental value of premises with an exceptional character can be determined by direct assessment by applying a rate to be defined during the experiment. The government must submit a report to parliament no later than September 30, 2015. This report outlines the consequences of the revision for taxpayers, local authorities, public establishments for inter-municipal cooperation and the State. It examines the methods according to which the revision is carried out with a constant tax product for the local authorities and endeavors in particular to measure:
- Tax transfers between categories of taxpayers;
- The impact of the revision on the financial and fiscal potential of local authorities, the distribution of state grants and equalization instruments.
JURISPRUDENCE
Compliance of free trade union associations
3rd Civil. November 5, 2014 (n°13-21.014) FS-PBRI:
The Court recalls4 here that the failure to bring the statutes of a free trade union association (ASL) into conformity before the expiry of the period provided for by the order of 1 July 2004 (Art. 60) and by the decree of 3 May 2006, deprives it of its capacity to sue but does not call into question its legal existence.
In this case, a summons had been issued in 2009 at the request of an ASL.
Created in 2001, this ASL had not published the modification of its statutes until June 9, 2012. On April 4, 2013, the Court of Appeal canceled all the procedural acts made at the request of the ASL from the document initiating proceedings. The Court of Cassation overturned the judgment on the grounds that the irregularity resulting from the lack of compliance was covered at the time the Court of Appeal ruled.
It should be emphasized that the solution of the judgment is expressly enshrined in the 2004 ordinance. Article 60 I. of the ordinance, amended by the Alur law, includes a third paragraph under the terms of which the ASLs, which have their statutes in conformity after May 5, 2008, cover the rights mentioned in article 5 of the ordinance from the publication of the Alur law without however being able to call into question the decisions passed in the force of res judicata.
4 See in particular 3rd Civ., QPC, 13 Feb. 2014, No. 13-22.383
3rd Civil. November 12, 2014 (n°13-25.547) FS-PB:
In this case, an ASL created on April 12, 1989 summoned one of its members on May 31, 2005. The defendant invoked the inadmissibility of the request. The Court of Cassation dismissed the appeal against the judgment of the Court of Appeal, which considered that the ASL had lost its capacity to sue and declared its action inadmissible.
The Court of Appeal held:
"that the ASL did not produce any document justifying the effective modification of its statutes worth putting in conformity with the ordinance of July 1, 2004". In addition, it specifies that "the acknowledgment of receipt of the "statutes of the association" issued by the prefecture on December 27, 2004 being insufficient to justify that these were indeed the statutes brought into conformity with the new regulations and the establishment of new articles of association dated October 3, 2011, which it noted for an uncritical reason that they were not in conformity with the applicable texts, not being able to allow it to regularize its situation with regard to its right to act in justice ".
Terms of appointment of the trustee by the co-owners
3rd Civil. November 5, 2014 (n°13-26.768) FS-PB:
A resolution tending to the appointment of a trustee was not approved by the majority of article 25 of the law of July 10, 1965. Collecting at least one third of the votes of all the co-owners, it was immediately proceeded to a second majority vote on Article 24 which led to the appointment of this trustee.
The Court of Appeal canceled this resolution insofar as the meeting also had to decide on the candidacy of another trustee and could therefore only proceed to a second majority vote on article 24 after having submitted by majority vote of article 25 the second candidacy.
The Court of Cassation recalls that "article 19 of the decree of March 17, 1967, taken for the application of article 25-1 of the law of July 10, 1965, applies when several syndic contracts are offered to the 'approval of the general meeting' and rejects the appeal.
Prescription of the action for annulment of the trustee's mandate
3rd Civil. November 19, 2014 (n°13-21.399) FS-PB:
A request for, on the one hand, the annulment of a decision of the general meeting of May 6, 2009, notified on May 14, 2009, allocating a trustee mandate and, on the other hand, the appointment of a director provisional is introduced by a joint owner on March 25, 2010.
The court of appeal declares the request inadmissible on the grounds that the action is time-barred.
According to the court, under the terms of article 42 al. 2 of the law of July 10, 1965, actions aimed at contesting the decisions of the general meeting must be exercised within a period of two months from the notification of the said decisions. The Court of Cassation quashed the judgment on the grounds that the claim, based on the lack of legal personality of the entity designated as trustee in the trustee contract and on the absence of the opening of a bank account or separate postal service, does not amount to an action challenging the general meeting that appointed the trustee.
Clarification on the interest in acting of the co-owners
3rd Civil. November 19, 2014 (n°13-18.925) FS-PB:
In a group of buildings subject to co-ownership status comprising thirteen buildings, co-owners of lots in building 7 were authorized, by a general meeting of co-owners of this building, to connect their apartment, located on the 3rd floor, to the rooms belonging to them on the 4th floor, to close off the portion of the common corridor on the 4th floor serving exclusively their premises and have been granted exclusive use of this part of the corridor.
Co-owners of a lot in another building assigned them to restitution of the hallway and demolition of the interior staircase. The Court of Appeal declared the claim inadmissible.
In support of its decision, the Court of Appeal pointed out that "the co-ownership regulations distinguished between the general common areas for all the co-owners of the buildings and the special common areas for the owners of each building, which it provided that at each lot were allocated general thousandths and particular thousandths for the common parts of each building and that the co-owners of each building could hold special meetings for questions concerning only their special common parts”. The Court of Cassation dismissed the appeal on the grounds that the Court of Appeal rightly held that this regulation created undivided ownership between the co-owners of each building, so that the other co-owners had no undivided property right over the parts of the building. buildings concerned. Since the plaintiffs did not hold any lot in building 7, their request for restitution of the common parts of this building was inadmissible for lack of interest and quality.
Reference to a fixed base index in an indexation clause
3rd Civil. December 3, 2014 (n°13-25.034) FS-PBR:
Under the terms of article L.112-1 of the Monetary and Financial Code:
"Any clause in a contract with successive performance, and in particular leases and rentals of any kind, providing for the taking into account of a period of variation of the index greater than the duration between each revision is deemed to be unwritten. ".
In this case, the Court of Appeal finds that the period of appreciation of the variation of the indices is systematically greater than the duration of a year elapsing between each indexation.
Indeed, the lease provided that "the annual rent excluding taxes is automatically and without any formality indexed annually each January first according to the variation of the INSEE index of the cost of construction, that the index to be taken into consideration is the last published on January 1 of each year, the reference index being the last known on July 12, 1996”. The Court of Cassation considers that the indexation clauses referring to a fixed base index do not contravene Article L. 112-1 of the Monetary and Financial Code since there is agreement between the period of variation of the index and that of the change in rent. Consequently, the Court of Appeal, which did not examine whether the method of calculation chosen by the clause created an effective distortion between the interval of index variation and the time elapsing between two revisions, did not give any legal basis for its decision.
Recovery of rental charges
3rd Civil. QPC, Nov. 5, 2014 (no. 14-40.039/ no. 14-40.040/ no. 14-40.041) FS-PB:
Article L. 442-3 of the construction and housing code in its version resulting from law n° 2010-1488 of December 7, 2010 on the new organization of the electricity market derogates from the rules of "recovery" rental charges by allowing the lessor, owner of a low-income building to recover all the heating charges, including the costs of depreciation and renewal of the installation.
This provision is the subject of a dispute, the plaintiffs consider that this provision is contrary to the principles of freedom and equality before the law guaranteed respectively by articles 4 and 6 of the Declaration of the Rights of Man and of the Citizen of 1789.
The third civil chamber transmitted the priority question to the Constitutional Council insofar as the text could be considered as introducing between the tenants, depending on whether the lessor decides or not to connect the building to a heating network, a unequal treatment not justified by a reason of general environmental interest, since the resulting financial burden only rests on certain tenants.
C. constitute. QPC, 23 January 2015 n°2014-441/442/443:
According to the Constitutional Council, the principle of equality before the law does not require that the rules for recovering rental charges for heating-related expenses be identical regardless of the heating mode used. The Council holds that the disputed provisions encourage the use of network energies for the purpose of protecting the environment, that the resulting difference in treatment, with regard to the charges that the low-cost housing organization can recover with its tenants, is directly linked both to a difference in situation and to the objective of general interest that the legislator has assigned itself. Consequently, the Council considers that the grievance alleging infringement of the principle of equality must therefore be rejected. The Council then notes that by modifying, including for current leases, the legal framework applicable to the determination of recoverable charges for low-rent housing, the legislator has not affected the agreements legally concluded and therefore does not affect infringement of the right to the maintenance of agreements legally concluded, guaranteed by articles 4 and 16 of the Declaration of 1789.
Modification of the distribution of charges following the change of use of a co-owned lot
3rd Civil. October 1, 2014 (n°13-21.745) FS-PB:
The owner of a lot for residential use located on the fourth floor of a condominium has rented it out for the exercise of a medical activity.
This owner sued the syndicate of co-owners of the property complex for annulment of the decision of the general meeting which modified the distribution of the elevator charges relating to his lot following the change of use of the latter. The Court of Appeal accepted the owner's request and noted that the co-ownership regulations provided that the apartments could only be occupied for the upper class or assigned to the exercise of a liberal activity and held that there had been no change of use within the meaning of article 25 f) of the law of July 10, 1965 when the co-owner has only used his lot in accordance with the stipulations of the co-ownership regulations.
Pursuant to article 25 f) of the law of July 10, 1965 in the wording applicable to the case, under the terms of which, the modification of the distribution of the charges caused by the collective services and the elements of common equipment, made necessary by a change in the use of one or more private portions, can be adopted by a majority of the votes of all the co-owners, the Court of Cassation overturns the judgment of the Court of Appeal. The Court of Cassation rules that this provision should be applied even when the new use is provided for by the co-ownership regulations.
Conditions for terminating the lease
3rd Civil. October 15, 2014 (n°13616.990) FS-PB:
In this case, an elderly tenant is summoned to terminate the lease for non-payment of rent.
The Court of Appeal orders the cancellation of the rent.
The tenant challenges the decision on the basis of article 15 III of the law of July 6, 1989, which prohibits the lessor from dismissing an elderly and destitute tenant without offering him an offer of rehousing. By this decision, the Court of Cassation limits the scope of this provision by specifying that this article does not apply in the event of judicial termination of the lease for failure of the tenant to fulfill his obligations.
Breach of the seller in his obligation to inform and liability of the notary
1st Civil. 26 November 2014 (n°13-27.965) F-PB:
Sentenced to return to the purchasers the amount of the security deposit following the judicial annulment of a promise to sell for error on the substantial qualities of the property sold, the sellers sued the notary for compensation due to professional negligence during the conclusion of the promise.
The Court of Cassation limits the scope of the notary's obligations. It first holds that the cancellation of the promise to sell was only due to the failure of the sellers in their obligation to inform the buyers. The Court then underlines that this preliminary contract was intended to establish the will of the parties without waiting for the expiry of the time limits useful for obtaining the additional information and administrative documents necessary for the completion of the sale. Consequently, the Court of Appeal was able to deduce from this the absence of any fault on the part of the notary, who had no reason to suspect the inaccuracy of the declarations of the sellers.
