Reference decision: cc • No. 17-31.101 • 2019-02-07 • View the decision →
Imagine: you buy a flat in Valbonne, in a peaceful condominium. The seller, owner of a unit (for example, a large flat they have divided into two studios), transfers one of the studios to you. You sign the deed, you notify the sale to the managing agent. And then, surprise: the managing agent demands service charges from you, but you are not yet registered in the register of co-owners? And what if the general meeting has not yet approved the new apportionment of service charges? This decision of the Court of Cassation of 7 February 2019 settles a crucial practical question: from when is a purchaser of a part of a divided unit considered a co-owner and therefore liable to pay service charges? The answer: from the notification to the managing agent, regardless of any subsequent approval.
The facts: a story that happens every day
Mrs. Y., owner in Cannes, is a co-owner in a residence. She sells a part of her unit (for example, a studio) to Mr. X. The condominium rules provide that units may be divided, but the apportionment of service charges between the parts has not been approved by the general meeting. Mr. X notifies his acquisition to the managing agent, but the condominium association refuses to recognise him as a co-owner, considering that the sale is not enforceable until the new apportionment of service charges is adopted. Result: Mr. X is sued for payment of service charges, and he turns against the seller. The Court of Appeal rules in favour of the association: it considers that the enforceability of the transfer is conditional on the approval of the apportionment of service charges. But the Court of Cassation quashes this judgment. It recalls that, under Article 6-2 of the Law of 10 July 1965, the managing agent must keep a register of co-owners and that notification to the managing agent of the transfer of ownership makes the transfer enforceable against the association. It does not matter that the general meeting has not yet approved the apportionment of service charges: the purchaser becomes a co-owner as soon as notification is given.
The reasoning of the court — dissected
The Court of Cassation relies on Article 6-2 of the Law of 10 July 1965 (which requires the managing agent to keep a register of co-owners and to notify transfers) and Article 35 of the Decree of 17 March 1967 (which specifies the notification procedures). It states that notification to the managing agent of the transfer of ownership of parts of a divided unit is sufficient to make the transfer enforceable against the association, without requiring prior approval of the new apportionment of service charges by the general meeting. In other words, the status of co-owner is acquired by notification, and service charges are due from that date. This reasoning is a confirmation of previous case law: it is not a reversal, but a clarification. The judges reject the association's argument that the absence of apportionment of service charges would make it impossible to determine the amounts due. In short: the association must first recognise the purchaser as a co-owner, and only then settle the issue of the apportionment of service charges. What few people know: this decision applies even if the condominium rules are incomplete or silent on the division procedures. The notification is decisive.
What this changes for you — concretely
If you are a purchaser of a part of a divided unit (for example, you buy a studio resulting from the division of a large flat in Cannes), you must notify the sale to the managing agent as soon as the deed is signed. From that notification, you are a co-owner and must pay the service charges. But be careful: if the apportionment of service charges has not yet been approved, you risk having to pay the full service charges of the original unit until the general meeting fixes a new apportionment. Numerical example: annual service charges of the original unit: €3,000. If the division is not approved, you could be liable for €3,000 per year, even if your part represents only 40% of the unit. For the seller, this decision is a protection: they are no longer liable for service charges after the notification. If you are a managing agent, you must update the register upon receipt of the notification and provisionally apportion the service charges according to the shares of the original unit, pending the general meeting. undefined, I have come across cases where managing agents refused to register the purchaser, causing arrears and proceedings. This decision puts an end to these blockages.
Four tips to avoid this type of dispute
- Notify immediately: as soon as the sale deed is signed, notify the managing agent by registered letter with acknowledgement of receipt of the transfer of ownership. Keep a copy of the notification and the acknowledgement of receipt.
- Check the condominium rules: before buying a part of a divided unit, ensure that the rules allow division and that they do not require prior approval by the general meeting. Otherwise, you could face difficulties.
- Require a warranty clause: in the sale deed, include a clause by which the seller undertakes to bear the service charges until the approval of the new apportionment, or to indemnify you in case of a claim by the association.
- Anticipate the general meeting: as soon as you acquire, ask the managing agent to include on the agenda of the next general meeting the issue of the apportionment of service charges. This will avoid a situation where you pay service charges not adapted to your unit.
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Further reading: related case law and developments
This decision is part of a consistent line of the Court of Cassation. For example, in a judgment of 7 April 2004 (no. 02-14.787), the Court had already ruled that the transfer of a divided unit is enforceable against the association as soon as notification is given, even if the condominium rules are incomplete. The trend is therefore clear: the legislator and the judges favour legal security for property transactions. However, be careful: if the division is not authorised by the condominium rules, the purchaser might not be recognised as a co-owner. In that case, it would be necessary to obtain a modification of the rules by a decision of the general meeting. In practice, this case law simplifies things for common divisions (studio, cellar, parking space) but does not dispense with a prior check of the rules.
In practice: what to do
FAQ
1. When do I become a co-owner after buying a part of a divided unit?
As soon as you notify the sale to the managing agent. You do not need to wait for the approval of the apportionment of service charges by the general meeting.
2. What if the managing agent refuses to register me in the register of co-owners?
Send a formal notice by registered letter. If the refusal persists, apply to the judicial court. You can also claim damages for the harm suffered.
3. Can I be sued for payment of service charges before the apportionment is approved?
Yes, the association can claim from you the service charges of the original unit. You will have to pay them, then turn against the seller if you have a warranty clause.
4. Is the seller still liable for service charges after notification?
No, from the date of notification, you alone are liable for the service charges. The seller is released.
5. What if the condominium rules prohibit division?
You cannot acquire a part of a divided unit without modifying the rules. Before buying, check this point. If the division has already taken place, you will need to obtain a decision of the general meeting to regularise it.
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