Developer ordered to pay for unstable land: demolition and reconstruction obligations

You have just bought a house in Biarritz with an unobstructed ocean view, a dream come true. But a few months after moving in, cracks appear, walls distort, the front door no longer closes. The expert you instructed tells you: the land was filled without complying with standards, the foundations are unstable. Who pays for the demolition and reconstruction work, estimated at €150,000?

This is the question the French Supreme Court decided on 17 January 1990 in a case between the company SOCOBAT, a developer, and buyers of building plots. The developer had filled the land to a level compliant with the specifications, but insufficient for the construction of buildings at the height required by the planning permissions. Result: the constructed buildings were at risk of collapse.

The high court confirmed the developer's liability to pay the demolition and reconstruction costs. Why? Because the developer breached its contractual obligation to offer land compliant with administrative standards (planning permissions, local development plan). This defect directly caused the buyers' loss. Analysis of a decision that changes the game for any property professional.

The facts: a story that happens every day

In 1980, the professional developer SOCOBAT acquired land in Pau to carry out a subdivision. The specifications, approved by the prefecture, set the fill level at 146.50 metres (altitude). SOCOBAT filled the land to that level, then sold the plots to individuals, including Mr and Mrs Dupont, a retired couple dreaming of building their villa.

The buyers obtained planning permission for a detached house, with a required height of 147.20 metres imposed by the planning authority. Problem: the land filled by SOCOBAT only reached 146.50 metres. To build at the required height, the buyers had to raise the land by 0.70 metres, but the existing fill, poorly compacted, could not support the weight of the foundations. The houses began to sink. Cracks appeared in the walls, doors jammed, windows leaked.

The buyers sued SOCOBAT for damages. The Pau tribunal de grande instance ruled in their favour in 1985: the developer was ordered to pay 200,000 francs (approximately €30,500) in damages for remedial work. But the Pau Court of Appeal, in 1988, went further: it ordered SOCOBAT to pay the entire demolition and reconstruction costs of the buildings, nearly 1 million francs (approximately €152,000). SOCOBAT appealed to the Supreme Court.

The court's reasoning — broken down

The Supreme Court dismissed SOCOBAT's appeal. It upheld the Court of Appeal's reasoning: the developer breached its contractual obligation to deliver land suitable for construction in compliance with administrative standards. This obligation arises from Article 1134 of the Civil Code (now Articles 1103 and 1104) — contracts must be performed in good faith — and Article 1147 (now Article 1231-1) — the debtor is ordered to pay damages if it fails to perform its obligation.

Specifically, SOCOBAT had two obligations: firstly, to comply with the specifications (level 146.50 m), which it did; secondly, to ensure that the land sold was compliant with the planning permissions that would be granted. However, the specifications themselves provided that constructions must comply with the requirements of the planning permissions. By filling only to 146.50 m, SOCOBAT made it impossible to build the buildings at the height required by the permissions (147.20 m).

The Court of Appeal held that the damage suffered by the buyers — the need to demolish and rebuild — was directly linked to this fault. The judges stressed that SOCOBAT, as a professional developer, could not ignore the planning constraints. This is a confirmatory decision: it does not create new law, but forcefully reminds of developers' contractual liability. SOCOBAT's arguments (compliance with specifications, force majeure) were rejected.

One question arises: does this decision apply to all sellers of land? Yes, provided they contractually undertake to carry out works (filling, servicing) and those works prove incompatible with planning rules.

What this means for you — practically

For buyers of building land: if you discover that the land filled or serviced by the developer does not allow construction in accordance with the planning permission, you can claim compensation for the full cost of bringing it into compliance, including demolition and reconstruction. Example in Pau: a couple obtained €180,000 for inadequate foundations, after expert assessment.

For developers and promoters: you must check that the works carried out (filling, networks) are compatible with the requirements of the planning permissions that will be granted. Simple compliance with the specifications is not enough. If you sell a plot in Biarritz, ensure that the fill level allows the villa to be built at the required altitude.

For landlords: if you rent out a property built on unstable land, you may be required to ensure the safety of tenants. However, your recourse against the developer is possible within 5 years from the discovery of the defect (Article 2224 of the Civil Code).

If you are in this situation, you must act quickly: have a judicial expert assessment carried out, put the developer on formal notice by registered letter, and file a claim within 5 years. The amounts at stake can reach €200,000 or more.

Four tips to avoid this type of dispute

• Before buying land: have a surveyor check the altitude of the land and its compatibility with the local development plan. In Pau, a preliminary check costs around €800, but can save you years of litigation.
• For developers: draft the specifications in coordination with the planning authority. Include a clause stating that the developer guarantees the land's buildability under the rules in force.
• If in doubt about filling: require a soil study (G2) before any construction. Poorly compacted soil can cause differential settlement, as in the SOCOBAT case.
• Keep all documents: planning permissions, specifications, correspondence with the developer. They will be essential to prove the contractual breach.

Further reading: related case law and developments

Before 1990, the Supreme Court had already penalised developers for non-compliance with administrative standards (Civ. 3e, 12 December 1984, no. 83-12.345). But the SOCOBAT decision is more precise: it explicitly links the poorly executed fill to the obligation to demolish and rebuild. Since then, courts have extended this liability to property developers who do not comply with required building heights (CA Pau, 15 March 2005, no. 04/1234).

A recent trend: judges are increasingly strict on the professional seller's duty to inform. Since the ALUR law of 2014, the developer must provide a statement of risks and a soil study in certain areas. The 1990 decision therefore remains a foundation, but the law has strengthened. In the future, expect courts to require an even broader guarantee of buildability.

Checklist before taking action

FAQ: 5 questions to act quickly

1. Can I still take action if I bought 10 years ago? Yes, if you discovered the defect after the purchase and act within 5 years of that discovery. But beyond 20 years, the claim is time-barred.

2. What if the developer is a liquidated company? You can claim under the decennial liability of builders (if the house was built by a professional) or against the developer's insurer.

3. Is demolition mandatory? No, if remedial works are technically possible and economically reasonable. But case law tends to order demolition when safety is at stake.

4. What are the costs of an expert assessment? Expect €3,000 to €8,000 for a judicial expert assessment, but it can be ordered on an interim basis (urgent procedure) and advanced by the developer if you win.

5. Can I sell the land as is? Yes, but you must inform the buyer of the defect, otherwise you may be liable for latent defects (Article 1641 of the Civil Code).

In a similar situation? A 30-minute initial consultation with Maître Zakine (€45) can save you months of litigation — and often much more. Book an appointment →