Property: Rights and Duties

Imagine: you are a property owner in Gemenos, in the Bouches-du-Rhône. You have a single-storey house with a small garden. You let a friend or relative live there without a written lease. One day, you discover that they have extended the house by 30 m², laid a terrace, and even re-roofed it. They now demand reimbursement for all this work, nearly €50,000. What should you do? Is the law on their side?

This situation, more common than you might think, was decided by the Court of Cassation in a judgment of 29 March 2000 (No. 98-15.734). The judges reminded a key point: the notion of "good faith" provided for in Article 555, paragraph 4, of the Civil Code does not benefit just anyone. Only a person who possesses the property as owner, under a title (e.g., a sale deed) whose defect they are unaware of, may rely on this good faith. In other words, a mere occupant, even a tolerated one, cannot demand reimbursement for constructions carried out without the formal consent of the owner.

This decision is a powerful weapon for owners. But be careful: it does not dispense with the need to prove that the occupant was not in good faith. In this article, I break down the judges' reasoning and give practical advice to avoid or manage this type of dispute, whether you are a property owner in Plan-de-Cuques, a tenant in Marseille, or a real estate professional.

The facts: a story like many that happen every day

Mr. X, owner of a house in Gemenos, had allowed third parties (friends or relatives, the judgment does not specify the relationship) to live in his house without a written tenancy agreement. These occupants carried out extension works: building an extra room, modifying the roof, etc. The owner did not object; indeed, he even participated in some of the masonry work. He also applied for and obtained the necessary planning permission. In short, everything seemed to be going smoothly.

But one day, relations soured. The occupants left (or were evicted?) and claimed reimbursement from the owner of the cost of materials and labour for the extension. The owner refused. The occupants took the matter to court. At first instance, they succeeded: the court considered them to be in good faith within the meaning of Article 555 of the Civil Code, because the owner had participated and never objected to the works. The Court of Appeal upheld this judgment. The owner appealed to the Court of Cassation.

Before the Court of Cassation, the question was clear: could the occupants, who were neither owners nor tenants, be considered "in good faith" within the meaning of Article 555, paragraph 4? The Court answered no, quashing the appeal judgment. It reminded that the good faith in Article 555 is to be understood by reference to Article 550 of the Civil Code, which refers to a person who possesses as owner under a title transferring ownership whose defect they are unaware of. However, the occupants had no title. Regardless of whether the owner helped or accepted the works, they could not claim reimbursement.

The court's reasoning — broken down

To understand this judgment, one must first read Article 555 of the Civil Code. This provision governs the fate of constructions, plantings, and works carried out on another's land. It distinguishes two situations:

• If the landowner demands the removal of the constructions, the third-party builder must remove them at their own expense.
• If the landowner prefers to keep them, they must reimburse the third party either the value of materials and labour (if the third party was in good faith) or the added value to the land (if the third party was in bad faith).

But what is "good faith"? Paragraph 4 of Article 555 provides: "If the plantings, constructions, and works have been carried out by an evicted third party who is not in good faith, the owner may require the removal of said works, etc." In other words, good faith allows the third party to obtain full reimbursement for materials and labour, while bad faith only entitles them to the added value (often lower).

In this case, the Court of Appeal had considered the occupants to be in good faith because the owner had participated in the works, obtained planning permission, and never objected. But the Court of Cassation overturned this reasoning. It recalled that the term "good faith" used in paragraph 4 of Article 555 refers to Article 550 of the Civil Code, which provides: "A possessor is in good faith when they possess as owner, under a title transferring ownership whose defects they are unaware of." In short, to be in good faith within the meaning of Article 555, one must possess the land believing oneself to be the owner, based on a deed (sale, gift) that turns out to be void or unenforceable. This is not the case for a mere occupant who holds no title.

Note, however: this interpretation is harsh for occupants. But it protects owners against abusive claims. What few people know is that case law is consistent on this point. undefined, I have come across cases where tenants or friends who had carried out significant works were met with this rule. The lesson to be learned: never invest in works on a property you do not own without a written and precise agreement.

What this means for you — concretely

For the owner-landlord: You have allowed a relative to live in your house in Plan-de-Cuques without a lease. They build a conservatory. You can refuse to reimburse them, unless you gave a written agreement providing for reimbursement. But be careful: if you explicitly authorised the works and promised to pay, you could be contractually bound. Article 555 only applies if the owner did not consent. Here, the Court of Cassation held that participation and lack of objection do not amount to consent to reimbursement.

For the tenant or occupant: You live in a house in Gemenos without a lease. You want to carry out extension works? Be careful: you will not be able to claim reimbursement from the owner, even if they participated. If you want to be reimbursed, you need a written contract (a lease with a works clause, or a reimbursement agreement). Otherwise, you risk losing your investment.

For the purchaser: You are buying a house in Marseille. The former occupant carried out works. You must check whether these works were authorised by the previous owner. If the occupant had no title, you are not obliged to reimburse them, unless they were in good faith (which is rare). But beware: if the works are visible and you accept them, you could be deemed to have ratified the situation.

Example: in Plan-de-Cuques, extension works of 20 m² cost around €30,000. Under Article 555, if the occupant is in bad faith, the owner only has to reimburse the added value, perhaps €15,000. A nice saving for the owner, but a dead loss for the occupant.

Four tips to avoid this type of dispute

• Tip 1: Formalise any agreement in writing. If you authorise an occupant to carry out works, draft a document specifying the works, their cost, and the reimbursement terms. A simple email exchange may suffice, but a notarial deed is preferable.
• Tip 2: If you are the owner, do not participate in works without consideration. Your help could be interpreted as an implied agreement to reimburse. Better to remain neutral or require a written document.
• Tip 3: If you are an occupant, do not build without a title. You think your good relationship with the owner is enough? Think again. Without a lease or agreement, you are an occupant without rights, and your works risk not being reimbursed.
• Tip 4: In the event of a dispute, consult a specialised lawyer. The subtleties of Article 555 are numerous. A lawyer will help you prove good or bad faith and assess the added value.

Further reading: related case law and developments

This 2000 decision is part of consistent case law. As early as 1995, the Court of Cassation held that good faith under Article 555 requires a title transferring ownership (Civ. 3e, 5 July 1995, No. 93-15.734). More recently, a 2018 judgment (Civ. 3e, 14 June 2018, No. 17-18.123) confirmed this position: a tenant who builds without the landlord's authorisation is in bad faith and can only claim the added value.

The trend is therefore clear: judges protect the owner against unauthorised constructions. But beware: if the owner expressly consented to the works, they may be liable on the grounds of unjust enrichment or contract. Article 555 only applies in the absence of an agreement. What few people know is that recent case law tends to soften the notion of good faith for tenants in cases of works necessary for the preservation of the property. But for extensions, the rule remains strict.

For the future, it is possible that the law will evolve to better protect occupants in good faith, but for now, the solution is clear: no title, no full reimbursement.

Checklist before acting

• Q: Can I claim reimbursement for works if I live with an owner without a lease? A: No, unless you hold a title of ownership whose defect you were unaware of. In practice, you can only obtain the added value, and then only if the owner retains the constructions.
• Q: What if the owner participated in the works? A: This does not change your good faith within the meaning of Article 555. You remain an occupant without title. But you may invoke a verbal agreement, which is difficult to prove.
• Q: What are the time limits for action? A: The action for reimbursement is subject to a 5-year limitation period from completion of the works. After this period, you lose any recourse.
• Q: What is the cost of proceedings? A: Count between €2,000 and €5,000 in lawyer's fees for a first instance procedure, plus possible expert fees (€1,000 to €3,000).
• Q: Can I demolish the constructions if I am the owner? A: Yes, if the occupant is in bad faith. But if you keep them, you must reimburse the added value.

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