Sale Annulled: Who Keeps the Rents Received? The Court of Cassation Rules

Imagine: you sell your house in Rochefort, and the buyer immediately lets it out. Six months later, the notary discovers a hidden defect: the roof has been leaking for years. The sale is annulled. But who must return the rents received by the buyer? The question is debated, and a recent decision of the Court of Cassation has just ruled. Explanations.

Are you a property owner in Puilboreau and have just bought a flat? Are you a landlord in La Rochelle and your tenant is demanding repairs? This decision directly concerns you. Because it reminds us of an essential rule: the restitution of fruits (i.e., rents or harvests) after annulment of a sale is not automatic. It depends on the good faith of the possessor.

In short, if the buyer was unaware of the defect at the time of purchase, he can keep the rents received. Otherwise, he must return them. But note: the judge cannot decide this on their own motion. It is up to the seller to request it. This legal subtlety has important practical consequences, which we will break down.

The Facts: A Story as Happens Every Day

Mr. Dupont, a property owner in Rochefort, sells his house to Mr. Martin in January 2018. The price is €250,000. Mr. Martin moves in quickly, but three months later he has to relocate for work. He then decides to let the house to a couple, the Durands, for €1,200 per month. Everything seems normal.

Except that in July 2018, a storm damages the roof. Mr. Martin calls a roofer who discovers an old waterproofing defect, masked by paint. The defect was hidden. Mr. Martin sues Mr. Dupont for hidden defect, seeking annulment of the sale (known as "rescission"). The court of La Rochelle finds in his favour in September 2019: the sale is annulled, and Mr. Dupont must repay the purchase price.

But what about the rents received by Mr. Martin between January 2018 and September 2019? That is 20 months of rent, i.e., €24,000. Mr. Dupont believes that Mr. Martin must return them, since the sale is retroactively annulled. Mr. Martin refuses, arguing that he was in good faith and that he maintained the house. The court did not rule on this point. The case goes up to the Court of Cassation.

The Reasoning of the Court — Analysed

The Court of Cassation, in its judgment of 11 February 2021 (No. 20-11.037), recalls a fundamental principle: when the contract of sale is annulled, the parties must mutually return what they have received. This is called "mutual restitution". The seller returns the price, the buyer returns the property. But what about the fruits (rents, harvests, etc.)?

Articles 549 and 550 of the Civil Code are clear: the possessor in good faith (the one unaware of the defect) keeps the fruits. The possessor in bad faith (the one who knew or should have known) must return them with the property. Good faith is always presumed; it is up to the person challenging it to prove bad faith.

But the Court goes further: it states that the judge cannot order the restitution of fruits on their own motion. It is up to the seller to make a request to that effect. In this case, Mr. Dupont had not requested the restitution of rents before the court. The Court of Appeal of Poitiers had nevertheless granted them on its own motion. The Court of Cassation quashes this decision: the judge violated the principle of adversarial proceedings (Article 16 of the Code of Civil Procedure) and the texts on good faith.

In other words, even if the restitution of fruits is a legal consequence of the annulment, the judge cannot order it without the interested party having claimed it. This is a protection for the buyer in good faith: he cannot be ordered to return rents without the seller having proved his bad faith.

What few people know is that this decision confirms a consistent line of case law. It does not create new law, but it reminds us of a rule often overlooked. undefined, I have encountered cases where sellers, believing that the restitution of rents was automatic, neglected to request it. Result: they lost significant sums.

What This Changes for You — Concretely

For seller-owners: if you sell a property and the sale is annulled (for hidden defect, fraud, mistake, etc.), you must imperatively request the restitution of rents received by the buyer. If you do not, the judge cannot grant them to you. Example: in La Rochelle, a flat sold for €180,000, let at €900/month for 18 months before annulment, that's €16,200 you lose if you forget to claim them.

For buyers in good faith: you can keep the rents received if you were unaware of the defect. But beware, if you knew of the defect (for example, if the seller warned you of a leak), you are in bad faith and must return everything. So it is better to keep all evidence of your good faith (surveys, correspondence, photographs).

For tenants: this decision does not directly affect you, but it explains why, in the event of annulment of the sale, your lease may be called into question. You might have to leave earlier than expected. If you are a tenant in Puilboreau, check that your landlord is indeed the legitimate owner.

For property professionals (agents, notaries): you must inform your clients of this rule. In the event of a dispute, advise the seller to make an express request for restitution of fruits. A simple oversight can be costly.

Four Tips to Avoid This Type of Dispute

• Carry out comprehensive surveys before the sale: in Rochefort as elsewhere, an energy performance certificate (DPE) or a pest inspection can reveal hidden defects. Better to know them in advance to mention them in the deed of sale and avoid any challenge.
• Keep all documents relating to the property: invoices for works, expert reports, photographs before acquisition. In case of a dispute, these elements will prove your good faith or that of the buyer.
• Include a clause on known defects: in the deed of sale, clearly indicate known defects. This limits the risk of claims for hidden defects. In Puilboreau, a seller had failed to mention a crack in the load-bearing wall: the sale was annulled two years later.
• If in doubt, consult a lawyer before signing: a quick consultation (€45 with Maître Zakine) can save you months of proceedings. A lawyer will advise you on the risks and steps to take.

Further Reading: Related Case Law and Developments

This decision is part of a line of judgments of the Court of Cassation that protect the possessor in good faith. We can cite the judgment of 4 November 2020 (No. 19-14.823) which holds that restitution of fruits is only due from the date of the court claim. And the judgment of 13 September 2017 (No. 16-19.587) which specifies that the bad faith of the possessor is assessed at the time of receipt of the fruits.

The trend is therefore clear: judges are demanding as to the proof of bad faith. They do not presume that the buyer knew. This is good news for buyers in good faith, but a reminder to sellers to be vigilant.

For the future, we can expect that the courts will continue to apply these rules strictly. The Court of Cassation ensures that the judge does not interfere in the debate by ordering restitutions that were not requested. This is a guarantee of respect for the adversarial principle.

Checklist Before Acting

If you are a seller and the sale is annulled:

• Have you requested the restitution of rents in your submissions (your written requests to the court)?
• Have you proved the buyer's bad faith? (e.g., if they knew of the defect before the purchase)
• Have you listed all fruits received (rents, harvests, etc.) with supporting documents?
• Have you consulted a lawyer to check that your request is properly formulated?
• Deadline: the request must be made before the judge renders their decision. After that point, it is too late.

If you are a buyer:

• Have you kept evidence of your good faith? (correspondence, surveys, witness statements)
• If the seller claims the rents, do you contest their claim by invoking your good faith?
• Note: good faith is presumed, but if you have doubts, it is better to be proactive.

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