Notaire Must Make All Enquries
Friday 03 March 2017
A notaire has a responsibility to make all appropriate enquiries, including verification of key assertions made by the seller, a French court has ruled.
As the notaires in France hold a monopoly of all conveyancing acts, buyers and sellers are obliged to proceed through them to undertake the legal formalities.
Their responsibilities include all legal searches in relation to the property and the title.
In a case that recently went before the French Supreme Court, the Cour de Cassation, a couple sold a house to a buyer with a clause stating that they did not accept respsonsibility for any hidden or latent defects in the property - clause de non-garantie des vices cachés.
It is a matter for the buyer to decide whether they are prepared to accept such a clause.
Although this clause is often routinely used by notaires at the request of the seller, it does not exonerate the seller from bringing to the attention of the seller any vices cachés in the property. If they fail to do so, and the defect is discovered after the sale has taken place, a court can rule that compensation be paid or that the sale be annulled.
The clause can only be upheld by the courts if the seller acted in good faith; that is to say, they are not aware of any major hidden defects at the time of the sale.
In the case before the French courts the sellers had withheld from both the buyer and the notaire that the property had been subject to an official 'natural disaster' (catastrophe naturelle) in the recent past, due to ground movement arising from drought.
Indeed, the sellers provided to the buyers an erroneous and obsolete report dating from 1989, and withheld from them a report from 1999 showing that the property had defects arising from ground movement.
The lower courts had found in favour of the buyer and ordered the seller to pay compensation amounting to €137,000, more than the actual sale price of the property.
As a result, the sellers brought a legal action against the notaire for not giving them proper advice about the disclosure of information relating to the natural disaster.
The appeal court considered that despite the wilful misconduct by the seller, it did not prevent them seeking a contributory remedy against the notaire, who, having assisted in the drafting of the fraudulent act, may be required to guarantee it partially.
The notaire contested the claim on the basis that he could not be made liable for information deliberately withheld by the seller.
The Supreme Court did not accept this argument stating that the notaire had an obligation to verify, wherever possible, the information provided by the sellers.
In making their ruling, the judges remarked that as the notaires offices were in proximity to the village they would have had knowledge of the official declaration of a natural disaster and should have made appropriate enquiries on the property, which would have been available from public records.
They should have also more closely questioned and advised the sellers on such an important matter.
Since this sale took place, the law on disclosure of natural disasters has been tightened up, so the risk that a case of this particular kind will occur in the future has been greatly reduced.
This article was featured in our Newsletter dated 03/03/2017