Construction defects: can you claim damages after selling the property?

A brand new villa, cracks appearing on the walls, a builder denying his liability... and an owner who, weary of it all, sells the property without warranty. This story is that of a widow whose property dream turned into a nightmare. Her claim against the contractor was initially dismissed because she had parted with the house. But the Court of Cassation, seised of the dispute, asked a decisive question: does the mere fact of selling extinguish the right to obtain compensation?

Each year, hundreds of owners faced with construction defects wonder if they can still act once the property has been sold. The answer is not a simple "yes" or "no"—it depends on a little-known legal mechanism: the assignment of the right of action (the transfer of the claim held against the liable party). This decision, handed down on 18 October 1972, sheds light precisely on this grey area.

What is the practical significance of this ruling? How can you protect your rights before a sale? And what should you do if you are the purchaser of a building affected by hidden defects? Let us decipher together this valuable reminder from the High Court.

The facts: a story that happens every day

An owner—referred to as "Widow Y" in the judgment—had had a villa built. Soon, defects (construction defects not in accordance with the rules of the art) appeared. She then initiated proceedings against the contractor to obtain reimbursement of the cost of repairs. The case ran its course... but before a final judgment was handed down, the widow decided to sell the house.

The deed of sale was unambiguous: she sold the building "without reservation" and expressly excluded any warranty for the poor condition of the building and the construction defects. In other words, the purchaser accepted the property as is, waiving the right to take action against the seller for defects. Relying on this clause, the contractor argued that Widow Y's right of action was extinguished: since she was no longer the owner and had sold without warranty, she could no longer suffer any loss.

The Court of Appeal agreed. It dismissed the claim for payment on the ground that the seller had voluntarily parted with her property and could therefore no longer "personally claim repair of the defects". But Widow Y did not give up: she lodged an appeal with the Court of Cassation. She had commenced her action before the sale—her right to obtain damages already existed. Should it necessarily be extinguished with the transfer of ownership? This is what the Court of Cassation would examine.

The court's reasoning—deciphered

The Court of Cassation overturned the Court of Appeal's decision. Its reasoning comes down to a key sentence: the lower court judges could not dismiss the claim without first investigating whether Widow Y had, upon the sale, assigned to the purchaser the right of action she was asserting against the contractor. Two essential concepts clash here: ownership of the property and title to the compensation claim.

A building is a physical object; the right to sue for construction defects is a "claim" (a personal right, a pecuniary value). However, these two elements are not indissociably linked. By selling the villa, Widow Y did transfer the real rights (the building itself), but she did not automatically assign her claim for damages against the builder. For that claim to pass to the purchaser, an express assignment would have been required—a separate legal act or a clause in the sale providing for that transfer.

The principle is an old one: a legal action is a piece of property, a "right of action" capable of being assigned (Article 1700 of the Civil Code). The Court of Cassation reminds us that the mere fact of selling the litigious property does not extinguish a claim that arose beforehand. In this case, it was for the lower court judges to verify concretely whether the deed of sale contained such an assignment. In the absence of this investigation, their decision was without legal basis.

In so doing, the High Court protects litigants against an overly automatic solution. The Court of Appeal had stopped at appearances: sale without reservation = waiver of all recourse. But in reality, the parties' intent matters: the widow could have wished to retain the benefit of her lawsuit, or conversely, to transmit it to the purchaser so that he could pursue the works. Nothing prohibits a seller from assigning his right to compensation while exempting himself from his own warranty.

What this means for you—in practical terms

Profile no. 1: the owner who has commenced an action before selling.
If you have already initiated proceedings against the contractor, do not panic at the idea of selling. Your claim exists independently of ownership. Either you retain it—and you can continue the proceedings even after the sale—or you assign it to the purchaser by stipulating this assignment in the deed. Without an express clause, any doubt benefits the contractor: the courts might consider that you have implicitly waived your right, hence the importance of a written document.

Profile no. 2: the purchaser of a property affected by defects.
You have just acquired a building and discover construction defects that the seller did not disclose. Before bringing your own action, find out: did the seller already have proceedings in progress? If so, did he assign this right in the deed of sale? If yes, you can take over the proceedings yourself. If not, you will have to act on another basis, such as the warranty for hidden defects (Article 1641 of the Civil Code) or the builder's decennial liability.

Example in figures: in Paris, an owner obtained €85,000 in damages for water ingress in a house in the 15th arrondissement, even though she had sold the property six months after commencing proceedings. The deed of sale specified that she "retained the benefit of the ongoing action". Without that phrase, the purchaser might have challenged the legitimacy of her claim.

Conversely, an owner who sells without reservation or any particular clause takes a risk: the contractor could argue that the loss has disappeared, since the seller is no longer the owner and no longer bears the repair costs. You must therefore, before the sale, make a strategic choice: pursue the proceedings to the end or negotiate with the purchaser the transfer of the lawsuit.

Four tips to avoid this type of dispute

• Insert a reservation of rights clause in the preliminary sale agreement. If you have commenced legal proceedings, have it set down in black and white that you retain the benefit of this procedure and any future compensation. Mention the court case number, the amount claimed, and the identity of the defendant.
• If you wish to transfer the action to the purchaser, formalise the assignment of the claim. A simple paragraph in the notarised deed is sufficient, provided it precisely describes the right assigned (nature of the dispute, court seised, status of the proceedings). The purchaser then becomes the new holder of the action.
• As a purchaser, demand from the seller a statement confirming the absence of any ongoing proceedings. This will protect you from unpleasant surprises: a seller who retains an action could be compensated for a loss that you now suffer.
• Consult a specialist lawyer before signing. The drafting of assignment or reservation clauses is delicate. A professional will be able to adapt the deed to your situation and anticipate challenges from the contractor.

Further insight: related case law and developments

This 1972 decision does not stand alone. The Court of Cassation has maintained this position over the decades. Thus, a judgment of the Third Civil Chamber of 10 July 1996 (No. 94-18.787) recalls that "the sale of the building does not, in itself, entail assignment of the claim for damages". More recently, the Court of Cassation confirmed that the seller could claim damages even after the sale, provided he proves a personal and direct loss still subsisting (Cass. 3e civ., 12 Sept. 2019, No. 18-17.650).

These decisions paint a clear trend: the courts protect the seller's right of action, provided he proves that his loss was not fully compensated by the sale price. They do, however, require transparency towards the purchaser. If the seller conceals the existence of a lawsuit, the purchaser could claim fraud (misrepresentation) to have the sale annulled or to obtain damages.

For the future, these principles remain stable. The real issue is one of proof: it is for the seller to demonstrate that he did not waive his claim. Hence the crucial importance of the drafting of the deeds.

What you need to remember

FAQ: your most frequent questions

If I sell my house with construction defects, can I still act against the contractor?
Yes, provided you commenced the action before the sale and you have not assigned this claim to the purchaser. The sale does not automatically extinguish your right to compensation.

What if I have already initiated legal proceedings before the sale?
Your right subsists. The court must examine whether you retained it or assigned it. Notify your lawyer of the sale so that he can adapt the procedural strategy.

Can the purchaser take over the action himself?
Only if you have expressly assigned him the right of action in the deed of sale. Otherwise, he will have to bring his own proceedings.

How do I formalise the assignment of the right of action in the deed of sale?
By a clause drafted by the notary or lawyer, stating that the seller transfers to the purchaser the entirety of his rights and actions relating to the ongoing dispute, together with all ancillary rights (interest, costs).

What are the risks if nothing is provided for in the deed?
The seller risks being found to lack standing to sue, and the purchaser could challenge the legitimacy of the action. In practice, the uncertainty often benefits the defendant (the contractor).

Do you find yourself in a similar situation? A 30-minute initial consultation with Maître Zakine (€45) could save you months of proceedings—and often much more. Book an appointment →