The expropriation of a building that is unhealthy, uninhabitable or subject to a decree of danger, is done under very disadvantageous conditions for the owner, recalled a judgment of the Court of Cassation.
Compensation is the value of the bare land, reduced by the cost of demolition, the Court confirmed, which may eventually lead to an expropriation without compensation.
In the court case, a municipality, applying this calculation, argued that the cost of demolition would be higher than the value of the land and that the owner should therefore be vacated without compensation.
However, said the expropriated party, rehabilitation is not excluded, the demolition depends on a possible decision of the expropriating community and consequently this method of evaluation must be discarded so that the property is paid for its market value. But this argument was rejected.
Expropriation for zero sum is not excluded
The compensation method applied by the expropriating authority, known as the land recovery method, is required by law when it comes to the benefit of the expropriating party, but case law rules out that it be used to benefit an expropriated party. It consists, to determine the value, considering the expected resale price and deducting all the expenses to be made in the meantime (works, financial costs, fees, margins of the participants).
When it comes to determining in particular the value of land earmarked for construction, justice dismisses this calculation and excludes the expropriated party from receiving the price of the land resold for construction, less miscellaneous costs and servicing costs. This reserves the benefit of the added value to the community or the developer and not to the dispossessed owner.
Invest in real estate from €1,000. OUR rankings of the best SCPIs
Even if the Constitution imposes fair and prior compensation in the event of expropriation, it is not excluded that this method, applied to an unsanitary building, entails deprivation of property for a symbolic sum or even zero.
(Cass. Civil 3, 13.4.2023, W 21-25.771).
Reproduction forbidden.