Buyers purchase a house adjoining a shop and discover, once they have moved in, noise from the neighbouring business that the seller had not disclosed. They obtain the annulment of the sale, the return of the price and damages, including €100,000 for the capital gain they would have made by reselling ten years later. The Cour de cassation (the French supreme court for civil matters) quashed that last head: a lost chance is compensated only if it is certain, and the hope of a “handsome capital gain” is not. The decision, handed down on 8 January 2026, concerns everyone who quantifies a property loss.
The facts
By deed of 27 March 2013, a seller sold the buyers, for €1,180,000, a dwelling house adjoining commercial premises. Noise from the neighbouring business led the buyers, after an expert appraisal, to sue the seller and the operating company for annulment of the sale and damages.
On 6 July 2023 the Versailles Court of Appeal annulled the sale and ordered the seller to return the price, plus the deed costs of €93,716.37. It further ordered the seller and the neighbouring company, jointly, to pay €100,000 for the lost chance of making a capital gain, on the ground that “had the house not suffered this heavy handicap of noise nuisance”, the buyers “would have kept it and could have hoped, in ten years, for a handsome capital gain on resale” (translated from the French). Lastly it ordered the neighbouring company, with the seller, to reimburse €35,808.73 of improvement works carried out by the buyers.
The decision
The Cour de cassation quashed the judgment in part (Cass. 3e civ., 8 January 2026, appeal no. 23-23.861). Three points.
Deed costs are not a restitution. By way of restitution following annulment, the seller “can be ordered to repay only the sums he personally received, without prejudice, where appropriate, to an order for damages compensating the loss caused by his fault”. Costs attached to the deed, received by the notaire (French civil-law notary) and the Treasury, are therefore not part of the restitutions; they may be claimed as a loss if a fault of the seller is established, which is a separate demonstration.
The lost chance of a capital gain must be certain. Under article 1382, now 1240, of the French Civil Code, the Court restated that “a compensable lost chance is the present and certain disappearance of a favourable possibility in a direct causal link with the fault found”. The Court of Appeal’s reasons, based on what the buyers “could have hoped”, were “unfit to characterise a lost chance of a capital gain on resale”, all the more so as the annulment had been ordered at the buyers’ own request.
Works are reimbursed by the party who recovers the property. Since the property was returned to the seller, “he alone was liable for the necessary and useful expenses incurred for its preservation” (former article 1381 of the Civil Code). The neighbouring company, a stranger to the sale, could not be ordered jointly to reimburse those works.
What this changes for the valuation
A future capital gain is not a loss unless it is demonstrated. The reasoning “the market is rising, so I would have gained” is not enough. For a lost chance of a capital gain to be upheld, the report must establish a real and present favourable possibility: a local market whose movement is measured by published indices and comparable sales over the period, a plausible holding period given the buyers’ plans, and a direct link with the fault. Even then, compensation is calculated on the probability of the lost chance, never on the whole of the hoped-for gain. Here the buyers had themselves asked for annulment: they could not both return the house and be compensated as if they had kept it.
What can be quantified with certainty. An undisclosed noise nuisance produces losses the expert can measure without speculating: the loss of value of the property, meaning the gap between its market value without the nuisance and with it, established by comparison and, where relevant, by the cost of sound insulation works when they are feasible; the loss of enjoyment during the period of occupation, assessed as a fraction of the rental value; and expenses incurred to no purpose. These heads have a method, references and a valuation date.
Loss is distinct from restitution. The decision draws a clear line between what falls to each party: the seller returns what he received and reimburses useful expenses because he recovers the improved property; the neighbour at fault compensates the damage caused by its nuisance. A valuation report that presents restitutions, useful expenses and losses in three separate tables, each with its legal basis, keeps the judge from mixing the regimes, and keeps the party from a cassation.
The new framework. For facts after 15 April 2024, abnormal neighbourhood disturbance falls under article 1253 of the French Civil Code, which makes the owner or operator strictly liable for a disturbance exceeding the normal inconveniences of neighbourhood. The requirement of a certain loss does not change.
What the expert takes from it
- A lost chance is compensated only if the favourable possibility is present and certain, and in proportion to the chance lost.
- A future capital gain is demonstrated by indices and sales, not by the intuition of a buoyant market; without demonstration, the head is dismissed.
- Loss of value, loss of enjoyment and wasted expenses are the solid heads of a neighbourhood loss; they are calculated at a precise valuation date.
- When a sale is annulled, restitutions and damages follow different rules; the report must keep them apart.
- Improvement works are claimed from the party who recovers the property, not from the neighbour.
Further reading
The Property loss of value page describes the assignment, its timescale and its fee. The glossary entries trouble anormal de voisinage, moins-value and perte de jouissance, and the guide I paid too much: can I challenge the price?, complement this article. On the same theme: Cancelling a property sale in France: serious price, lesion, fraud and Loss of view in a dense urban area: no abnormal disturbance. The decision is available on Légifrance.
What next
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