Price of Reserved Land: Expropriation Must Not Spoil You

Imagine: you own a plot of land in Le Cannet, in the Grasse hinterland. For years, you have paid property taxes, maintained the plot, and perhaps hoped one day to build a house for your children. But then, the local urban development plan (PLU, the document setting out building rules in your commune) classifies your land as a "non-affected zone" or "buildable only to the extent of 5% of the total area." In other words, you can do virtually nothing. One day, the commune decides to pre-empt this land to build a public facility (a school, a road, a park). You receive a compensation offer that takes into account this very limited buildability. Result: the offer is derisory, sometimes 10 times less than what the land would be worth if free of any reserve. What to do? This 1970 decision of the Cour de cassation gives you a decisive legal weapon. In clear terms, the judges said: the price of reserved land must be fixed, vis-à-vis the expropriating authority (the public body taking your property), as if that reserve did not exist. Why? Because it is the authority itself that imposed the planning restriction. It cannot rely on it to pay less. Remember this date: 23 April 1970. This judgment is still relevant today and applies throughout France, including in the jurisdictions of Grasse and Mont-de-Marsan where I practise.

The facts: a story that happens every day

We are in the Paris region, but the case could just as easily take place in Sophia-Antipolis or Le Cannet. Mr X owns a plot of land in an area covered by the Paris region planning scheme. This scheme classifies his plot as a "non-affected zone," meaning that buildability is very limited: only 5% of the total area may be built on, and only for buildings meeting specific needs. In other words, the land has a very low market value because it is virtually undevelopable. An expropriation procedure ensues (the public authority forces you to sell your property for a public purpose, such as building infrastructure). The authority offers compensation based on this reduced buildability. Mr X contests: he argues that the compensation must be calculated as if the land were not subject to this reservation servitude (planning servitude, i.e., a restriction imposed by the local urban development plan). The disagreement is total. The case goes up to the Cour de cassation, the highest French judicial court. The lower courts (Tribunal de grande instance, Court of Appeal) had ruled in favour of the authority, holding that the value should take account of the restriction. But the Cour de cassation quashes this judgment: it holds that the price must be fixed as if the reserve did not exist. In other words, to assess the prejudice (the loss suffered by the owner due to the expropriation), one must look at the date when the land was definitively taken, but disregarding the reservation servitude burdening the land. This is a reversal (change in case law) very favourable to owners.

The reasoning of the court — broken down

The Cour de cassation relies on a fundamental principle: that of equality before public burdens. This principle, enshrined in the 1789 Declaration of the Rights of Man and of the Citizen (Article 17), provides that no one may be deprived of their property without just and prior compensation. If the authority imposes a planning restriction (such as a reserve), it cannot then use it to reduce the expropriation compensation. That would be a double penalty for the owner. Concretely, the judges reason as follows: to fix the price, one must ask what the land would be worth if it were not subject to the reserve. One compares it with similar plots, free of any servitude, in the same area. For example, in Sophia-Antipolis, a developable plot may be worth €300 per m², while a plot subject to a buildability reserve limited to 5% would be worth only €50 per m². The authority cannot offer €50 by relying on the restriction it itself imposed. The Court specifies that this rule applies even if the reserve was established before the planning scheme in force at the time of expropriation. Note, however: this is not full compensation for the value in full ownership, but compensation that neutralises the effect of the reserve. In clear terms, the owner receives compensation close to what they would have obtained if the land had never been reserved. This solution is confirmed by several subsequent decisions, including the Cour de cassation judgment of 4 June 1973 (No. 72-70.074) in the same vein. What few people know is that this case law also applies to other planning servitudes, such as non aedificandi servitudes (building prohibitions) or road reserves. undefined, I have come across cases where owners in Le Cannet accepted an insufficient offer because they were unaware of this judgment.

What this means for you — concretely

If you own land subject to a planning reserve (non-buildable zone, limited buildability, reserved site for a public road, etc.) and the authority initiates an expropriation procedure, you must absolutely insist that the compensation be calculated without the reserve. Let's take a concrete example: in Sophia-Antipolis, a 1,000 m² plot in a buildable zone is worth about €200,000. If the commune declares it reserved for a future road, the value drops to €40,000. The compensation offer on that basis would be €40,000. Thanks to the 1970 judgment, you can challenge this and obtain compensation close to €200,000, i.e., €160,000 more. For an owner who lets the land (you lease it to a farmer or operator), the loss of rent must also be compensated taking into account the value without the reserve. For a buyer (you bought a reserved plot knowingly, but at a reduced price), the case law does not allow you to claim an additional amount if you already paid a price reflecting the reserve. However, if you are expropriated, you can claim the benefit of this rule. How to react? If you receive a compensation offer, do not accept it without consulting a lawyer lawyer. You have a two-month deadline to challenge it before the expropriation judge (the judge competent to fix the compensation). After that deadline, the offer becomes final. Note: the authority may try to circumvent the rule by invoking other grounds. Your lawyer must therefore demonstrate that the reserve was imposed by the authority itself and that it has the effect of reducing the value.

Four tips to avoid this type of dispute

• Keep all planning documents: as soon as you are informed of a reserve on your land (e.g., via a planning certificate, a PLU or a land use plan), keep the evidence carefully. They will serve to prove the date and origin of the restriction.
• Never sign a compensation offer without legal advice: even if the offer seems fair to you, have it analysed by a lawyer. A simple signature may deprive you of any subsequent recourse.
• Challenge within the deadlines: if the offer does not satisfy you, refer the matter to the expropriation judge within two months of notification of the offer. Once the deadline has expired, you lose any right to challenge the amount.
• Have your land valued by an expert without the reserve: before any negotiation, ask a property expert to value your land as if it were free of any servitude. This report will be a key piece in your file.

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Further reading: related case law and developments

The 1970 judgment has been confirmed by several subsequent decisions. For example, the Cour de cassation held in a judgment of 4 June 1973 (No. 72-70.074) that the same principle applies to road reserve servitudes. More recently, the Cour de cassation recalled in a judgment of 22 November 2017 (No. 16-25.142) that expropriation compensation must be fixed taking into account all administrative servitudes, except those imposed by the expropriating authority itself. The trend is therefore constant: the judges protect the owner against abuses of public power. However, note: if the reserve was imposed by the State or another authority other than the expropriating one, the rule may not apply. It is therefore necessary to identify the author of the servitude. In the Grasse jurisdiction, I have seen cases where the expropriating commune was not the one that imposed the reserve (e.g., the département). In that case, the owner cannot rely on the 1970 judgment. That is why a case-by-case analysis is essential.

What you must absolutely remember

FAQ:

1. What should I do if I receive a low compensation offer for my reserved land?
Do not sign anything. Consult a lawyer lawyer within two months to challenge the offer before the expropriation judge. You can request that the compensation be calculated as if the reserve did not exist, on the basis of the 1970 judgment.

2. Can I sell my land to a private individual at a price free of reserves?
No, the rule applies only in cases of expropriation. If you sell to a private individual, the price will be freely negotiated, but the buyer will take the reserve into account. The case law only protects against public authorities.

3. What are the deadlines for action?
You have two months from notification of the compensation offer to challenge it. After that deadline, the offer becomes final and you can no longer claim an additional amount.

4. Does this rule apply to all types of planning reserves?
Yes, for all reserves imposed by the expropriating authority itself, whether it is a road reserve, a non-buildable zone or a buildability restriction.

5. How much does a challenge before the expropriation judge cost?
Lawyer's fees vary, but a first 30-minute consultation with Maître Zakine costs €45. The proceedings may cost between €1,000 and €3,000 depending on complexity, but the stakes are often much higher (several tens of thousands of euros).

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