Right of enjoyment in a housing development: can a leaseholder be a co-lot owner?

Imagine the scene: in Somain, Mr. Dupont, owner of a plot in a housing development, signs an emphyteutic lease (a long-term lease, generally 18 to 99 years, with an obligation to build) with a company. The company undertakes to erect buildings. Years pass, the company builds, but the planning permission is not entirely compliant with the development's specifications. Who is responsible? The owner or the lessee? And above all, does the latter have a say in the rules of the development? This is precisely the question that arose in this case, and to which the Court of Cassation answered on 17 November 2004.

This decision is of primary interest to any owner or tenant in a housing development, whether in Somain, Aniche or elsewhere. It settles a often overlooked point: the leaseholder who benefits from a right of enjoyment for building is considered a co-lot owner, i.e., a co-owner of the development. This means that they are subject to the same rules and can act to enforce them, or be pursued if they do not comply.

You may be wondering: how does this affect me? If you are the owner of a plot in a housing development and you lease it out long-term, or if you are a tenant with an obligation to build, this case law gives you keys. It clarifies who must ensure compliance with the specifications and what remedies are available. Let's delve into the details.

The facts: a story that happens every day

We are in a housing development near Douai. An owner, whom we will call Mr. X, grants an emphyteutic lease over a plot to a company. The development's specifications provide that the lessee benefits from the enjoyment of the land for the purpose of erecting buildings. The company therefore builds, but the planning permission it obtains does not comply with certain stipulations of the specifications (for example, distances from boundaries or the height of constructions).

Other co-lot owners (the owners of neighbouring plots) consider themselves aggrieved and sue the company in court to have the constructions demolished or modified. The company defends itself by saying: 'I am only a tenant, I am not a co-lot owner, I do not have to comply with the specifications, only the owner is responsible.' The co-lot owners, on the other hand, argue that the lessee, benefiting from a real right (a right in rem, like a usufruct or easement) of enjoyment, should be considered a co-lot owner.

The Douai Court of Appeal ruled in favour of the co-lot owners. It ordered the demolition of the non-compliant constructions, based on the enforceable planning permission (i.e., unchallenged and final). The company appealed to the Court of Cassation. The Court of Cassation, in its judgment of 17 November 2004, dismissed the appeal. It confirmed that the leaseholder, beneficiary of the right of enjoyment, indeed has the status of co-lot owner. It does not matter whether the planning permission complies with the specifications: the judge may order demolition as long as the permission is enforceable and the construction does not comply with the rules of the development.

The reasoning of the court — dissected

To understand the decision, one must first know what a housing development is. It is a division of land into several plots intended to be built on. Each plot is subject to specifications that set out rules (height, appearance, use, etc.). The owners of the plots are called co-lot owners. They form a free syndical association (a kind of small co-ownership) that ensures compliance with the rules.

The central question was: can an emphyteutic leaseholder (a very long-term lease, with an obligation to build) be considered a co-lot owner? The Court of Cassation answers yes, based on the fact that the specifications confer on them a right of enjoyment over the land 'for the purpose of erecting buildings'. This right is akin to a real property right (a right over the property, enforceable against all), which makes them a co-lot owner.

Next, the Court validates the reasoning of the Court of Appeal, which had ordered demolition based on the enforceable planning permission, even if that permission was not compliant with the specifications. Why? Because planning permission is an administrative act that authorises construction, but it does not dispense with compliance with the private rules of the development. The civil court can therefore order demolition if the construction violates the specifications, regardless of the validity of the permission. Here, the permission was enforceable, so the construction was legally authorised, but it remained contrary to the contractual obligations between co-lot owners. The Court of Cassation clarifies that the judge does not have to verify the conformity of the permission with the specifications: it is sufficient to note that the permission is final and that the construction does not comply with the rules of the development.

In summary, this decision confirms a jurisprudential trend: real rights of enjoyment confer the status of co-lot owner, thereby strengthening the enforceability of specifications against long-term tenants. This is a victory for co-lot owners who want to enforce the rules, but an additional constraint for lessees.

What this changes for you — concretely

For the owner landlord: If you lease a plot in a housing development long-term (emphyteutic lease or building lease), you must ensure that your tenant complies with the specifications. In case of non-compliance, you could be pursued by other co-lot owners, even if you are not the cause of the construction. Concrete example: in Aniche, an owner leases a plot for 30 years. The lessee builds a house that is too high. The neighbours sue. The owner is jointly and severally liable with the lessee for demolition. Cost: €50,000 in works and €10,000 in damages. Therefore, check the construction project before signing.

For the lessee (tenant): You are now considered a co-lot owner. You must comply with the specifications like any owner. If you do not, you may be forced to demolish at your own expense. On the other hand, you also have the right to participate in decisions of the co-lot owners' association and to enforce the rules against others. If a neighbour builds in violation of the specifications, you can sue them directly.

For the purchaser of a plot: Before buying, check whether the land is leased long-term. If so, the lessee has rights that may limit yours. Request a copy of the lease and the specifications. If the lessee has already built, ensure everything is compliant.

For co-lot owners: This decision gives you a direct remedy against the lessee, even if the owner is inactive. You no longer have to wait for the landlord to act. You can sue the lessee in court to stop the infringements.

Four tips to avoid this type of dispute

• Check the specifications before any construction: Whether you are an owner or a lessee, read the development's rules carefully. Have your project validated by the co-lot owners' association or a lawyer to avoid unpleasant surprises.
• Include a compliance clause in the lease: If you are a landlord, impose on the lessee the obligation to comply with the specifications and provide for financial security (surety, deposit) to cover restoration works in case of non-compliance.
• Obtain compliant planning permission: Even if the decision says that an enforceable permission suffices, it is safer to apply for permission that respects the specifications. This reduces the risk of litigation.
• Consult a lawyer specialising in property law: Before signing an emphyteutic lease or starting works, seek advice. A lawyer can analyse the specifications and the project to anticipate disputes. In Somain or Aniche, Maître Zakine can assist you.

Further reading: related case law and developments

This decision is part of a line of judgments that extend the notion of co-lot owner to holders of real rights. For example, the Court of Cassation has already held that a usufructuary (someone who has the right to use and enjoy a property without being its owner) is a co-lot owner (Civ. 3e, 10 May 2001, No. 99-18.764). Similarly, a building lease lessee (a lease that confers a real right on the lessee to build and operate) has been recognised as a co-lot owner (Civ. 3e, 6 February 2002, No. 00-19.584).

The trend is therefore towards assimilating all holders of real property rights (emphyteusis, usufruct, building lease) to owners for the application of development rules. This strengthens the effectiveness of specifications, but may surprise lessees who thought they were merely ordinary tenants. In the future, we can expect courts to continue in this direction, particularly for very long-term leases (over 30 years).

Checklist before acting

• Q: Is an ordinary tenant (3-year lease) a co-lot owner?
  A: No. Only leases conferring a real right (emphyteusis, building lease, lease of more than 30 years) are concerned. A standard residential lease does not confer co-lot owner status.
• Q: Can I demolish a non-compliant construction without authorisation?
  A: No. You must obtain a court order. Unilateral demolition is prohibited. Apply to the judicial court.
• Q: What is the time limit to act against a non-compliant construction?
  A: The action for demolition based on violation of the specifications is time-barred after 5 years from completion of the works. Do not delay.
• Q: Does planning permission override the specifications?
  A: No. The permission is an administrative act, the specifications are a private contract. One does not prevail over the other. You must comply with both.
• Q: What to do if the lessee does not comply with the specifications?
  A: Send a formal notice to the lessee to comply, then apply to the court. You can also claim damages. Consult a lawyer promptly.

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