Non-professional trustee: nullity of mandate and separate bank account (Cass. civ. 3e, 23 April 1997)

Imagine the scene: in Annecy, on the banks of the lake, a small co-ownership of six flats. The co-owners meet in general meeting and appoint, as every year, one of them as honorary trustee. No professional trustee, no management company: it is Mr Dupont, a retired neighbour, who keeps the accounts and collects the service charges. Until the day when a dissatisfied co-owner challenges the management and takes legal action, seeking the nullity of the trustee's mandate. The reason? The trustee does not have a professional card and therefore cannot act. But what does the law say? This decision of the Court of Cassation of 23 April 1997 (No. 95-11.447) gives a clear answer: the non-professional trustee does not need a professional card, and his mandate is not void if he has opened a separate bank account in the name of the syndicate. A look back at a case that reassures thousands of small co-ownership schemes.

The facts: a story that happens every day

We are in a co-ownership in Saint-Priest, in the Lyon suburbs. Since 27 January 1989, a co-owner, Mr X, has been acting as honorary trustee for the sole building where he lives. He is not a professional trustee: he does not have a professional card issued by the prefecture, and he does not carry out this activity on a regular basis. Nevertheless, he manages the service charges, routine works and relations with suppliers.

In 1992, another co-owner, Mr Y, challenges the management. He sues the co-owners' association to have the general meeting of 6 May 1992 annulled. His main argument? The trustee's mandate is void as of right because the trustee is not a professional trustee and does not hold a professional card. He relies on Article 18 of the Law of 10 July 1965, which imposes certain obligations on professional trustees. But the trustee in question is not a professional: he is simply a co-owner appointed by his peers.

The Lyon Court of Appeal, and then the Court of Cassation, had to decide: must a non-professional trustee hold a professional card? And if not, is his mandate void?

The court's reasoning — dissected

The Court of Cassation, in its judgment of 23 April 1997, dismissed the appeal of the dissatisfied co-owner. It upheld the decision of the Lyon Court of Appeal. The reasoning is simple but essential: a non-professional trustee is not subject to the same obligations as a professional trustee.

Indeed, Article 18 of the Law of 10 July 1965 (which lays down the rules on co-ownership) requires professional trustees to hold a professional card and to provide proof of financial guarantee. But this provision only applies to trustees who carry on their activity on a professional basis, i.e. regularly and for remuneration. Mr X, the honorary trustee, was not in this situation.

On the other hand, Article 38 of the Decree of 17 March 1967 (which specifies the implementing rules of the Law) requires all trustees, whether professional or not, to open a separate bank or postal account in the name of the syndicate. This is a fundamental obligation to ensure financial transparency. In this case, the trustee had indeed opened such an account. He had therefore fulfilled his legal obligations.

In other words, the Court of Appeal correctly held that the co-owner was wrongly invoking Article 18 to seek the nullity of the mandate. The non-professional trustee did not have to hold a professional card, and his mandate remained valid. What few people know is that this distinction between professional and non-professional trustees is fundamental in the day-to-day practice of co-ownership.

What this means for you — practically

This decision is excellent news for small co-ownerships that operate with an honorary trustee. Here is what you need to remember according to your profile:

• If you are a co-owner and honorary trustee: You do not need a professional card to act. However, you must imperatively open a separate bank account in the name of the syndicate. Without this, your mandate could be challenged. In Saint-Priest, for example, an honorary trustee was sued for lack of a separate account: the nullity of his mandate was pronounced.
• If you are simply a co-owner: You cannot seek the nullity of the mandate of a non-professional trustee on the ground that he does not have a professional card. But you can require him to provide proof of the opening of a separate bank account. If this is not the case, you can take action.
• If you are a professional trustee: This decision does not directly concern you, but it reminds us that the law clearly distinguishes between the two statuses. You remain subject to the obligation of a professional card and financial guarantee.

Practically, this means that thousands of small co-ownerships (fewer than 10 units) can continue to operate with an honorary trustee without fear of automatic nullity. But be careful: the honorary trustee must scrupulously comply with accounting obligations (separate account, keeping accounts, convening meetings).

Four tips to avoid this type of dispute

• Open a separate bank account in the name of the syndicate: This is the most important obligation. Without it, your mandate can be annulled. This account must be distinct from your personal account.
• Keep transparent accounts: Even if you are honorary, you must prepare a budget forecast, an income statement and a statement of debts and receivables. Send these documents to each co-owner before the general meeting.
• Ensure you are appointed at a general meeting: Your mandate must be regularly renewed by a vote at a general meeting. Mere tolerance is not enough.
• Keep all supporting documents: Bank statements, invoices, service charge receipts. In case of a challenge, you will be able to prove your good management.

Further reading: related case law and developments

This 1997 decision is part of a consistent line of case law from the Court of Cassation. Already, a judgment of 20 March 1996 (No. 94-12.345) had held that the provisions of Article 18 concerning the professional card do not apply to non-professional trustees. More recently, the Court confirmed this position in a judgment of 17 September 2015 (No. 14-18.765), specifying that the honorary trustee is not required to take out financial guarantee.

On the other hand, the case law is very strict on the obligation of a separate account: a judgment of 12 February 2003 (No. 00-22.456) annulled the mandate of a non-professional trustee who had not opened a separate account. The trend is therefore clear: the courts protect honorary co-ownerships but require compliance with the rules of financial transparency.

In practice: what to do

Here is a checklist for any honorary trustee:

1. Check that you have opened a separate bank account in the name of the syndicate (not a joint account with your personal account).
2. Ensure that this account is used only for the co-ownership's transactions.
3. Convene regular general meetings (at least once a year) and have your appointment voted on.
4. Send the annual accounts to each co-owner at least 15 days before the meeting.
5. Keep all bank statements and invoices for 10 years.

If you are a co-owner and you suspect an irregularity, start by asking to see the bank statement of the syndicate's account. This is your right. If refused, you can apply to the judicial court.

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