Full compensation if the expropriation displaces a business

Traders forced to move because of an expropriation must be compensated regardless of the age of their facilities.

He is entitled to compensation that allows him to resettle to continue his activity under the same conditions, specifies the Court of Cassation, and there is no taking into account the dilapidation of the expropriated premises in which he worked.

This indemnity relates to the obligation to transfer the business to another place. It has no connection with the value of the expropriated walls or with the value of the goodwill which is not expropriated from it.

A local authority, having expropriated a building that housed a wholesale business, offered a resettlement allowance to the tenant trader and took into account the age and dilapidation of the premises to reduce the sum.

It considered that an indemnity enabling him to relocate to newer premises or ones in better condition would bring a profit to this merchant, whereas his damage must be indemnified without loss or profit, according to the rule of expropriation.

But starting from the same principle of compensation without loss or profit, the Court of Cassation ruled the opposite.

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There is no profit for the trader who receives an indemnity corresponding to his reinstallation costs, even if his new premises turn out to be less dilapidated. It is only a question of paying him an indemnity which will allow him to continue his activity in new premises.

(Cass. Civil 3, 29.6.2022, U 21-15.741).

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