Three reported rulings of the Third Civil Chamber, handed down in the autumn of 2016, say what the tenant farmer’s work on the land he rents is worth in law. On 6 October 2016, the Cour de cassation (the French supreme court for civil matters) upheld the refusal to award an outgoing wine-growing company the added value its plantations had brought to the estate: the outgoing tenant is entitled only to the cost of his improvements, amortised, “whatever the legal basis invoked”. On 3 November 2016, it recalled that “a farm lease has no patrimonial value in itself”, but accepted that a farm business generating subsidies and single payment entitlements be entered in the assets of an estate, independently of the land. On the same 6 October 2016, it quashed the ruling that had treated a mushroom grower’s cultivation methods and know-how as non-transferable; the valuer therefore has three distinct objects to quantify: amortised improvements, a farm business, know-how.
The facts
In the first case, by notarial deeds of 26 February 1974 and 5 April 1979, two spouses grant a long-term farm lease (bail rural à long terme, a lease under the French statutory tenancy regime for farmland) to a wine-growing company over an agricultural estate comprising buildings and plots. By deeds of 6 October 2004, the landlords serve notice to quit over the whole estate for 31 October 2008. The company applies to the rural lease tribunal (tribunal paritaire des baux ruraux) for compensation of the added value its improvements brought to the holding. The Bordeaux Court of Appeal, on 12 February 2015, dismisses that claim and sets the departure indemnity on the basis of the residual value of the vineyard: according to the appeal, €242,942, against an added value assessed by the court-appointed expert at €3,468,183.25.
In the second, two spouses married under community of property die on 20 February 1992 and 13 November 2007, leaving four daughters. One of them farms the Vervins plots, asks for “the farm business” to be left out of the estate’s assets and applies for the preferential allocation (attribution préférentielle, the right of an heir to be allotted the farm he or she works, against an equalising payment to the others) of shares in an EARL (a French farming company) and of agricultural land. The Amiens Court of Appeal, on 3 February 2015, holds that the farm business must be valued independently of the land, already counted in the assets, then says that the preferential allocation cannot be decided as matters stand and sends the parties back to the liquidating notary (notaire liquidateur).
In the third, cellars intended for mushroom growing are let with effect from 1 February 1984; on 6 March 1984, an agreement transferring elements of the farm business (cession d’éléments d’exploitation agricole) is concluded, and the tenants pay a sum under it. After a notice to quit on the ground of retirement age, they claim its return from the landlords’ successors under article L. 411-74 of the Rural and Maritime Fishing Code (code rural et de la pêche maritime). The Amiens Court of Appeal, on 5 May 2011, grants the claim: cultivation methods, processes and know-how, “assuming they were specific to the transferor and that knowledge of them was not directly accessible to the public, could not constitute transferable elements of the farm business”.
The decision
First ruling (Cass. 3e civ., 6 October 2016, no. 15-18.796, reported): dismissed. The court of appeal rightly held that articles L. 411-69 and L. 411-71 of the Rural and Maritime Fishing Code “exclude for the outgoing tenant any form of compensation other than the indemnity equal to the cost of the works and improvements valued at the expiry of the lease after deduction of an amortisation per year of use, whatever the legal basis invoked”, noted the absence of any specific agreement between the parties on additional compensation for the added value, and “gave a legal basis to its decision to determine the departure indemnity from the total residual value of the vineyard”.
Second ruling (Cass. 3e civ., 3 November 2016, no. 15-20.366, reported): on the estate’s assets, dismissed. The court of appeal held, “rightly, that a farm lease has no patrimonial value in itself”, and found that, “according to the supporting documents produced, that farm generated identifiable values, such as to make it a fruit-bearing economic entity, without counting the leases concluded over part of the plots”; it “could deduce from this that it had to be valued independently of the value of the land and entered in the estate’s assets”. On preferential allocation, partly quashed under article 4 of the Civil Code: by sending the parties back to the notary without ruling, the court of appeal breached that provision. Remitted, on that point, to the Amiens Court of Appeal, differently composed.
Third ruling (Cass. 3e civ., 6 October 2016, no. 11-21.700, reported): quashed in all its provisions, for lack of legal basis in relation to article L. 411-74. By ruling “without examining in what way the cultivation methods or know-how could not constitute transferable elements of the farm business on a change of farmer, the court of appeal did not give a legal basis to its decision”. Remitted to the Douai Court of Appeal.
What this changes for valuation
The departure indemnity measures an amortised cost, not added value. For works carried out in compliance with the statute, a tenant farmer who has built, planted or transformed the soil receives, on leaving, the cost of his works valued at the expiry of the lease, amortised per year of use. The added value brought to the holding, which the statute uses as a ceiling for plantations, is not the measure of the right, save a specific agreement between the parties on additional compensation. The valuer appointed at the end of a farm lease therefore reconstructs, plantation by plantation and building by building, the date of execution, the cost at the date of departure and the amortisation accrued. The 2024 ruling on renewed farm rent and the tenant’s unauthorised buildings recalls that those improvements are assessed only at the end of the lease; the 2016 ruling states how. Outside the statutory farm tenancy regime, that exclusivity does not apply: an occupier without a lease, as in swapping the use of farm plots, falls under the general law, in principle accession under article 555 of the Civil Code for buildings and plantations, the owner who keeps them repaying at his choice the added value or the cost of materials and labour at the date of repayment, and, failing any other action, unjust enrichment (article 1303 of the Civil Code).
The lease has no value in itself, the farm business may have one. A farm lease is attached to the person of the tenant and has no patrimonial value in itself. But what the tenant does with the rented land produces rights which do count: livestock subsidies, payment entitlements attached to the declared areas. The court of appeal found, from the supporting documents produced, “identifiable values”, “without counting the leases concluded over part of the plots”, and the Court accepted that it could infer from this a valuation separate from the land. The valuer lists the payment entitlements, which transfers between farmers allow to be priced, the subsidies acquired and, unless they belong to a company whose shares are valued elsewhere, the livestock, the equipment and the stocks; if the entity produces a surplus, the méthode par le revenu (income method) checks the consistency of the result. An ordinary farm lease stays at zero; a lease transferable outside the family (bail cessible hors du cadre familial, articles L. 418-1 et seq. of the Rural and Maritime Fishing Code) follows a separate regime.
The land on one side, the farm business on the other. The land is valued separately and, if let, as let, as the Court held in December 2025 for the farm let to the allottee’s company and in March 2025 for the farmland sold to the tenant son. The décote pour occupation (discount for occupation) on the land measures the burden of the lease for the owner; the value of the farm business measures what the tenant’s work produces and enters the tenant’s estate. Where the same estate includes both the land and the farm business, the two values add up, with no line for the lease. The quashing on the second point, under article 4 of the Civil Code, finally penalises the judge who sends the parties back to the notary without ruling on the attribution préférentielle; the equalising payment will then be computed on values at the date of jouissance divise (the date from which each party enjoys his or her own share), set as close as possible to the partition. The guide Drafting a market value expert remit for a partition in France and the article on allocation limited to the bare ownership help to frame that valuation.
Know-how cannot be ruled out as a matter of principle. Article L. 411-74 penalises sums demanded without consideration on a change of farmer; the transfer of elements of the farm business remains lawful at their value. The third ruling adds that cultivation methods and specific know-how cannot be excluded as a matter of principle from the transferable elements, the court having to examine what was really passed on. The valuer describes what was transferred, separates what was accessible to any farmer from what was specific to the transferor, and quantifies the part of the price those elements justify, by the time saved and the extra yield they bring the incoming farmer: the surplus is the undue payment.
What the valuer takes from it
- The outgoing tenant’s indemnity is computed exclusively under articles L. 411-69 and L. 411-71, cost of the improvements amortised per year of use; the added value is not compensated, save a specific agreement.
- A farm lease has no patrimonial value in itself, subject to the separate regime of the transferable lease; the farm business’s subsidies and payment entitlements may constitute identifiable values, valued and entered in the tenant’s estate independently of the land.
- Land included in the same estate is valued on its own side, as let if it is let, in particular to a company (Cass. 1re civ., 10 December 2025); the farm business is added to it with no line for the lease.
- Cultivation methods and specific know-how are not excluded as a matter of principle from the elements transferable on a change of farmer; the report describes and quantifies what was really passed on, each object with its date and its legal basis.
Further reading
The Market value page describes the assignment, its timescale and its fee. The guide Drafting a market value expert remit for a partition in France and the glossary entries attribution préférentielle, méthode par le revenu and décote pour occupation complement this article. On the same theme: Renewed farm rent: the tenant’s unauthorised buildings stay out and Swapping the use of farm plots does not create a farm lease. The decisions are available on Légifrance: no. 15-18.796, no. 15-20.366 and no. 11-21.700.
What next
A tenant farmer leaving the holding, plantations or buildings to compensate, or a farm business to enter in an estate?
I establish the cost of the improvements at the date of departure and their amortisation, the value of the farm business, subsidies and payment entitlements included, separately from the land, and what was actually transferred on a change of farmer, for the landlord, the tenant, the notary or the rural lease tribunal.
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