Service Charges in Co-ownership: When an Exemption Clause Becomes Illegal

Imagine you own a flat in a residential building in Saint-Paul-lès-Dax. You have just received the call for funds for the refurbishment of the stairwells, a significant expense amounting to several thousand euros. Upon consulting your co-ownership regulations, you discover a clause that appears to exempt the owner of the ground-floor commercial premises from these charges. Is this legal? Do you still have to pay your share?

This situation, which I have encountered several times in my practice between Mont-de-Marsan and Saint-Vincent-de-Tyrosse, raises a fundamental question: can a co-ownership regulations provide that certain owners will not contribute to the expenses for the conservation of common areas? The answer, provided by a decision of the Court of Cassation, is unequivocal.

The judgment of 8 July 1998, which we will analyse, serves as a reminder of an essential principle of co-ownership law: charges relating to the conservation and maintenance of the building must be apportioned among all co-owners, proportionally to the value of their units. No contrary clause can derogate from this. But what does this mean concretely for you, as an owner, tenant, or real estate professional?

The Facts: A Story as Common as Any

The story begins in a multi-unit building, similar to those found in the town centre of Saint-Paul-lès-Dax or along the national road in Saint-Vincent-de-Tyrosse. The building comprises several flats on the upper floors and commercial premises on the ground floor, occupied by an SCI (Société Civile Immobilière).

The co-owners' association decides to undertake significant works: the complete refurbishment of the walls and landings of the stairwells. These works, necessary to ensure the conservation (i.e., the maintenance in good condition) of the common areas, represent a substantial expense. When the association apportions this expense among the co-owners, the SCI of the commercial premises refuses to pay its share.

Its argument? The co-ownership regulations contain a specific clause that exempts the owner of the commercial premises from charges relating to the façades and staircases. According to this clause, only the flat owners should bear these expenses. The co-owners' association contests this position and takes the matter to court.

The court of first instance rules in favour of the association, considering the clause contrary to law. The SCI appeals, but the court of appeal upholds the first judgment. Dissatisfied, the SCI files an appeal on points of law (pourvoi en cassation), arguing that the appeal judges violated the law by declaring this clause non-written (i.e., as if it did not exist). It is this final stage that leads to the decision we are analysing today.

The Court's Reasoning — Deconstructed

The Court of Cassation, in its judgment of 8 July 1998, dismisses the SCI's appeal and fully validates the decision of the court of appeal. Its reasoning rests on two fundamental legal pillars.

Firstly, the judges remind us that the refurbishment of the walls and landings of the stairwells indeed constitutes an expense for the conservation of common areas. Now, according to Article 10 of the Law of 10 July 1965 (which governs co-ownership), charges for the conservation and maintenance of the building must be borne by all co-owners, proportionally to the relative value of the private parts included in their unit. In other words, each owner pays according to the value of their property relative to the whole building.

Secondly, and this is the crucial point, the Court of Cassation affirms that no clause in the co-ownership regulations can derogate from this legal principle. The clause that exempted the SCI from charges relating to the staircases is therefore declared non-written. In plain terms, it is considered null and void, even if it was written in black and white in the regulations signed by all co-owners.

What few people know is that this solution applies even when the clause has been unanimously accepted by the co-owners. The Law of 10 July 1965, in its Article 1 paragraph 3, indeed provides that the co-ownership regulations cannot contain clauses contrary to the mandatory provisions of this same law. The rules on the apportionment of conservation charges are part of these mandatory provisions.

undefined, I have encountered cases where owners of commercial premises thought they benefited from a permanent advantage thanks to such clauses. This decision serves as a reminder that solidarity among co-owners is not an option but a legal obligation.

What This Means for You — Concretely

If you are a co-owner of a flat, this decision protects you. You cannot be forced to bear alone expenses that should be shared by all. Take a concrete example: in a residential building in Saint-Vincent-de-Tyrosse, the refurbishment of the stairwells costs €50,000. If the commercial premises represent 30% of the building's value, its owner must contribute €15,000, even if a clause in the regulations claims to exempt them.

If you are the owner of ground-floor commercial premises, be cautious: you must check your co-ownership regulations. Any clause that exempts you from charges for the conservation of common areas is potentially illegal. In case of works, the association can demand your share, and you will have to pay, even if you contest it. In such a case, legal proceedings could last 18 to 24 months and cost several thousand euros in legal fees.

If you are a tenant, this decision concerns you indirectly. Your landlord, if they have to pay additional charges, might be tempted to pass them on to you as service charges. But remember: only charges for the conservation, maintenance, and management of common areas can be passed on, and according to strict modalities defined by law.

If you are purchasing a property in co-ownership, this decision should prompt you to be vigilant. Before buying, have the co-ownership regulations checked by a professional. An illegal exemption clause could create future conflicts and affect the value of your investment.

Four Tips to Avoid This Type of Dispute

• Read your co-ownership regulations carefully before buying a property. Seek assistance from a specialised solicitor if necessary, especially for mixed-use buildings (residential/commercial).
• Check the legality of clauses concerning the apportionment of charges. Any clause that exempts a co-owner from charges for the conservation of common areas is suspect.
• In case of doubt, consult the managing agent or the residents' committee. They can inform you if similar clauses exist and how they are applied.
• If you are a member of the residents' committee, propose an update of the co-ownership regulations to remove illegal clauses. A revision can be voted on in a general meeting.

In-Depth Analysis: Related Case Law and Developments

This 1998 decision is part of a consistent line of case law. Already in 1984, the Court of Cassation had affirmed in a famous judgment that "charges for the maintenance and conservation of common areas must be borne by all co-owners proportionally to the value of their units" (Cass. 3rd civ., 6 June 1984).

More recently, in 2015, the Court of Cassation confirmed this principle by specifying that it applies even when the co-owner exempted by the illegal clause does not use the common areas in question (Cass. 3rd civ., 14 October 2015). In other words, even if the owner of the commercial premises never uses the staircases, they must contribute to their maintenance.

The trend in the courts is clear: they protect the principle of solidarity among co-owners and systematically annul clauses that derogate from it. For the future, this means that co-ownership regulations containing such clauses will need to be revised, at the risk of creating disputes with every significant call for funds.

Checklist Before Taking Action

• If you receive a call for funds for works: check whether all co-owners are indeed being charged according to their legal share.
• If your regulations contain an exemption clause: know that it is probably illegal. Do not rely on it to avoid payment.
• If you are a managing agent or committee member: apply the legal apportionment of charges, even if the regulations provide otherwise.
• If you are considering legal action: consult a specialised solicitor to assess your chances of success and the cost of proceedings.
• If you are buying a property in co-ownership: have the regulations checked by a professional and demand the regularisation of illegal clauses before signing.

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