A public body pre-empts plots of land (préemption, a public body’s right to step into the buyer’s shoes when a property is sold), and the price is argued before the expropriation judge (juge de l’expropriation). May that judge rely on sales of plots within the same perimeter subject to less restrictive planning rules, ignore an occupation of the premises raised before it, or reduce the estate agent’s fee stated in the notice of intention to sell? In a reported decision of 14 December 2017, the Cour de cassation (the French supreme court for civil and commercial matters) frames all three points: references taken from another zone must be justified, a requested discount for occupation must be examined, and the expropriation judge may say who bears the fee, but may not reduce it on account of the agent’s alleged faults.
The facts
A SCI (société civile immobilière, a French property-holding company) owned plots in a deferred development zone (zone d’aménagement différé), an area where sales may be pre-empted. It served a notice of intention to sell (déclaration d’intention d’aliéner) on the Côte basque-Adour inter-municipal authority (communauté d’agglomération); according to the ground of appeal, the notice, filed at the town hall on 2 July 2014, referred to the fee of the estate agency involved in negotiating a preliminary sale agreement. The local public land agency, holding the urban pre-emption right by delegation, exercised it and then, absent agreement, applied to the expropriation judge of the Pyrénées-Atlantiques to set the price.
On 12 May 2016 the Pau Court of Appeal valued the pre-empted plots, located in zone UAd, from the average value of three sales of plots located in zone UAg, concluded on 13 September 2010, 28 September 2012 and 24 December 2013. UAd and UAg are two planning zones; while accepting that they differ in building height, the Court of Appeal refused to distinguish between them: the prices in the notarial deeds were “exclusive of deductions for easements, notably planning ones”, and the difference in height was “necessarily taken into account when setting the sale price of the land” (translated from the French). Although asked to, it did not examine whether occupation of the premises warranted a discount; the Cour de cassation does not describe that occupation.
The land agency also claimed it was not bound to pay the fee, since the estate agency had performed no real service. The first-instance judge referred it to the proper court on that point (renvoi à mieux se pourvoir), which the Court of Appeal upheld. The land agency appealed to the Cour de cassation.
The decision
The Cour de cassation partly quashed the decision (Cass. 3e civ., 14 December 2017, appeal no. 16-20.150, reported).
On the price, under article L. 213-4 of the Planning Code and article L. 322-4 of the Expropriation Code, it held that the Court of Appeal had ruled “on reasons unfit to justify how the comparables retained, which concerned plots located in zone UAg, were suitable comparison elements for valuing the expropriated plots, located in zone UAd, subject to more restrictive planning rules, and without examining, as it was asked to, whether a discount should be applied on account of the occupation of the premises”; it “did not give a legal basis to its decision”. The word “expropriated” here refers to the pre-empted plots.
On the fee, the ground of appeal was dismissed. The expropriation judge, “who has jurisdiction to determine, according to the indications in the parties’ undertaking and in the notice of intention to sell, whether the body exercising its pre-emption right is bound, as substituted for the buyer, to bear the estate agent’s fee, does not have jurisdiction to reduce or remove that fee on account of faults the agent may have committed in performing its assignment”. Having rightly found that the principle, the amount and the allocation of the fee resulted from negotiations leading to a contract with an estate agent who was not a party to the proceedings, the Court of Appeal “correctly deduced that the expropriation judge, a court of special jurisdiction, had no jurisdiction to rule on the claim”.
The case was sent back, except on the fee, to the Bordeaux Court of Appeal. Other reported decisions of 2017 settle separate questions: withdrawal from pre-emption while an appeal is pending and the right to require purchase of a building taken out of a ZAC, a public development zone (zone d’aménagement concerté).
What this changes for valuation
The price in a deed carries the rules of the property sold. A sale in zone UAg prices in the zoning of the plot sold, not that of the plot valued: it measures the value of UAg land; applied unchanged to a more restricted UAd plot, it credits that plot with building possibilities it lacks. The Court does not forbid references from another zone, but requires the decision to explain how they suit the property valued.
The choice of comparables must be reasoned. The valuer first looks for references in the same zone, under the same height, footprint and use rules. Failing sales there, the report says so and corrects the gap, for instance by bringing each price back to the buildable floor area of the plot sold. A reported decision of 2024 on references drawn from public databases leaves the judge free to assess the comparables debated by the parties; it does not contradict the 2017 decision, which requires their relevance to the zoning to be justified.
Occupation raised before the judge calls for an answer. The quashing sanctions a failure to examine, not a refusal of a discount. The report therefore addresses the point: who occupies, under what title, at what rent and for what remaining term, at what cost the property can be vacated; it then applies the resulting discount, or explains why it is nil. It may be: in a 2023 opinion, the Court found that rehousing an expropriated owner-occupier is not a reduction in market value (Rehoused expropriated owner: allowance for rehousing only).
The fee is an item to identify, not to value. Substituted for the buyer, the pre-empting body may owe the fee: the expropriation judge says so from the parties’ undertaking and the notice, but can neither reduce nor cancel it for faults alleged against the agent, who is not a party to the proceedings. In practice, the report values the property excluding the fee and sets out separately the items of the notice: price, fee and the party bearing it; it expresses no view on how the agent performed the mandate.
What the valuer takes from it
- Comparables for a pre-empted property are sought first under the same planning rules; a reference taken from a less restrictive zone is used only with a justification of its relevance, in practice a quantified correction.
- Once a discount for occupation is claimed, the report examines the occupation and quantifies its effect, or explains why that effect is nil.
- The expropriation judge says whether the pre-empting body bears the estate agent’s fee, but can neither reduce nor cancel it on account of faults alleged against the agent; the report values the property excluding the fee.
Further reading
The Compulsory purchase and pre-emption page describes the assignment, its timescale and its fee. The guide Pre-emption by a public body in France: setting a defensible price and the glossary entries droit de préemption, comparable and décote pour occupation complement this article. The other 2017 decisions: Pre-emption in France: withdrawal not late while appeal pending and Right to require purchase in a ZAC ends if property is excluded. On the same theme: Compulsory purchase: comparables from public databases are enough and Rehoused expropriated owner: allowance for rehousing only. The decision is available on Légifrance.
What next
A pre-empted property whose price is argued before the expropriation judge, with references from another zone or an occupier?
I establish the price of the pre-empted property from comparable sales subject to the same planning rules, quantify the discount for occupation and set out separately the items of the notice of intention to sell, for the seller, the public body or the judge.
Free quote, by email or by phone. No commitment before the quote is accepted. Fees are never linked to the value of the property (Charte de l’expertise, Title I, §2.1).
