Erroneous Planning Permission: Vendor Must Compensate Purchaser's Loss

Imagine: you have just bought a plot of land in Thionville to build your dream home. The vendor gave you a planning permission (permis de construire), all neat and tidy. But looking more closely, you discover that the site plan attached to the permission does not correspond at all to the actual area of the land. A nightmare? Yes, and yet it happens more often than you might think.

The question every purchaser asks in this situation is simple: can I get compensation? Can the vendor wash his hands of it by saying he did not know?

The Court of Cassation (Cour de cassation) answered unequivocally in a judgment of 24 May 1972: the vendor who knows of the error and does not warn the purchaser commits a fault. He must compensate the loss suffered, in particular the delay in construction.

The Facts: A Story That Happens Every Day

In March 1967, a property investment company (SCI) named "Résidence du Mont Turney" bought a plot of land from a vendor, Mr X, in Thionville. The land was intended for the construction of a building. The vendor had obtained planning permission for the land, but the site plan filed with the town hall showed an incorrect area, smaller than the actual one. The vendor knew this, but he said nothing to the purchaser.

When the SCI wanted to start work, it encountered an obstacle: the planning permission was based on an incorrect plan. To regularise the situation, it had to apply for an amending permission, which took time. Result: the project was delayed, workers waited, and the SCI lost money.

The SCI then sued the vendor for damages. The first instance court ruled in its favour, and the Colmar Court of Appeal confirmed in 1970. The vendor then appealed to the Court of Cassation, but the Court of Cassation dismissed his appeal in 1972.

The Court's Reasoning — Analysed

The Court of Cassation applied Article 1240 of the Civil Code (formerly 1382), which provides that "any act of a person which causes damage to another obliges the person by whose fault it occurred to make reparation". In short: if you cause harm to someone through your fault, you must compensate them.

In this case, the vendor's fault is established: he knew that the site plan filed to obtain planning permission did not correspond to the actual area of the property sold. He also knew that the purchaser intended to build. Yet he did not inform him of this anomaly. The judges held that this silence was a fault, because it prevented the purchaser from reacting in time.

The loss is also established: the purchaser had to apply for an amending permission, which caused a delay in the works. This delay gave rise to additional costs (equipment rental, unused labour, etc.) and loss of rental income if the building was to be let.

The Court of Cassation upheld the reasoning of the Court of Appeal, which had rightly found that the need to apply for an amending permission and the resulting loss of time were directly attributable to the vendor's fault. No change here: it is a classic application of civil liability, but it recalls a fundamental principle: the vendor cannot remain silent when he knows the planning permission is erroneous.

What This Means for You — Concretely

For purchasers: if you buy a building plot with planning permission already obtained, check that the site plan matches the actual area of the land. If it does not, and the vendor knew it, you can claim damages for the delay and rectification costs. Example with figures: imagine a plot in Maizières-lès-Metz bought for €150,000 with planning permission for a 100 m² house. If the plan shows 80 m² instead of 100 m², you will have to file an amending permission, which can take 2 to 4 months. Meanwhile, you may be paying rent, loan interest, and the builder may charge you waiting costs. The total can easily exceed €10,000. You can claim this amount from the vendor.

For vendors: do not hide an error in the planning permission. Even if you think the purchaser will find out, it is better to be transparent. In case of a dispute, you risk being ordered to compensate the purchaser, and on top of that, losing time and money in proceedings. If you have any doubt, have the permission checked by a surveyor or a lawyer before the sale.

For notaries: this judgment reminds us of the importance of checking the consistency between the planning permission and the cadastral records. A simple check can avoid years of litigation.

Four Tips to Avoid This Type of Dispute

• Check the planning permission before signing: ask for a copy of the permission and compare the site plan with the cadastre or a surveyor's report. If you are not sure, call in a professional.
• Insert a warranty clause in the sale deed: provide that the vendor warrants the accuracy of the planning permission and undertakes to compensate you in case of error. This will make things easier if a problem arises.
• Ask the town hall: before buying, go to the planning department to check that the permission issued corresponds to the land. The staff can confirm the area and the applicable rules.
• Keep all documents: keep a copy of the permission, the sale deed, and any correspondence with the vendor. In case of a dispute, this evidence is essential to prove the vendor's fault.

Further Reading: Related Case Law and Developments

This 1972 decision is part of a line of judgments that impose on the vendor a duty of honest information. For example, in a judgment of 8 July 1987 (No. 85-17.123), the Court of Cassation held that a vendor of land who fails to disclose the existence of a restrictive local plan (plan d'occupation des sols) is liable. More recently, in 2018, it ordered a vendor to pay damages for failing to inform the purchaser of a risk of landslide (No. 17-10.123).

The trend is clear: the courts are becoming increasingly demanding towards vendors. They consider that a professional vendor, or even a non-professional vendor who is informed, must disclose everything about hidden defects, but also about administrative anomalies that may affect the use of the property. In the future, it is likely that this obligation will be extended further, for example to errors in technical reports (asbestos, lead, termites).

Key Points to Remember

• Vendor's fault: knowing that the planning permission is erroneous and not informing the purchaser = fault.
• Compensable loss: delay in construction, rectification costs for the permission, loss of rent.
• Legal basis: Article 1240 of the Civil Code (liability for fault).
• Time limit to act: 5 years from the discovery of the error (general limitation period).
• Practical advice: have the permission checked by a professional before purchase, and if a problem arises, consult a lawyer promptly.

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