Under a vente en état futur d'achèvement, the purchaser buys a property whose construction has not yet been completed. The buyer's choice is made on the basis of a description and several plans. As a result, buyers are never certain of the final quality of the building when they sign the deed of sale. The first fear of the VEFA buyer is that the property will not correspond to what was originally planned, or that the construction will contain defects.
This is why the legislator has introduced a system to protect purchasers, enabling them to take legal action against the seller in the event of a problem.
Defects in conformity
A lack of conformity is not a defect in the construction, but a discrepancy between what was agreed in the contract and what was actually delivered. This may be due to missing elements or elements that are different from those specified.
For example, the flat has a shower whereas a bathtub was provided for in the contract.
These defects are assessed on the basis of what is stated in the deed of sale, the descriptive note appended to the deed, and the section and elevation plans of the property development. In many cases, these documents are not attached to the deed but are filed with a notary. The deed of sale will simply refer to these documents in the deed of deposit.
Similarly, case law sometimes recognises the contractual value of advertising documents used as a basis for assessing lack of conformity.
In practice, provision is often made for an equivalence clause allowing the seller to use equipment of the same brand and quality for the construction as that shown in the contract or in the descriptive notice attached to the sale. This clause will apply in the event of supplier default.
Where there is a lack of conformity, a distinction must be made as to whether or not the defect is substantial. If it is not, and the purchaser notices the defect when the keys are handed over, he or she can deposit the balance of the price (the remaining 5%) and ask for the keys to be handed over. The balance will be paid once the property has been brought up to standard.
If the balance has not been paid, or if the defect is of a substantial nature, the purchaser may askfor the property to be brought into compliance or for the price to be reduced, failing which the sale may be rescinded.
The time limit for taking action depends on whether or not the defect is apparent. In the case of an apparent defect, the time limit is thirteen months from the date of entry into possession. For defects that are not apparent, the period is10 years from acceptance of the work.
Apparent construction defects
These are defects inthe construction that are sufficiently apparent for a non-professional in the construction or property industry to be able to detect them. To be considered apparent, the defect must be revealed at the latest either when the work is handed over, or at the end of a period of one month from the date on which you take possession of the property.
In the same way as for apparent defects in conformity, this action may be brought within thirteen months of taking possession of the works. The purchaser may ask for the defect to be remedied or for the price to be reduced, failing which the sale may be rescinded.
Hidden defects: ten-year and two-year warranties
When a defect is hidden at the time the work is handed over (i.e. cannot be detected by a non-real estate professional), the buyer benefits from the ten-year or two-year guarantee.
The ten-year guarantee
Under article 1792 of the French Civil Code, the VEFA vendor is "automatically liable to the purchaser of the property for any damage, including damage resulting from a ground defect, which compromises the solidity of the property or which, affecting one of its constituent parts or one of its equipment components, renders it unfit for its intended use".
He is also liable for damage affecting the soundness of the building's fixtures and fittings, but only when they are inseparably linked to the foundation, framework, enclosure or roof. This is the case when the removal, dismantling or replacement of the equipment cannot be carried out without damaging or removing material from the structure.
The defect must be sufficiently serious to be covered by the ten-year guarantee. Judges have broad discretion.
The defect must compromise the soundness of the structure, the soundness of an item of equipment that cannot be separated from the structure, or render the structure unfit for its intended use. For example: a lack of fit and finish, failure to comply with earthquake regulations that could jeopardise the building in the event of an earthquake, etc.
The purchaser of a property in a future state of completion, and any subsequent purchasers, may take action against the seller within 10 years of acceptance of the work. The professional vendor is presumed to be responsible for the damage.
The two-year guarantee
The biennial guarantee covers hidden defects in equipment that are not covered by the ten-year guarantee. This guarantee applies to components that can be separated. For example, defects affecting an intercom system, tiles that have simply been glued down, a boiler that can be disassembled, etc., are covered by this guarantee.
The warranty period is two years from acceptance of the work.
Sound insulation defects guarantee
Within one year of taking possession, the seller of a building under construction is liable to the purchaser for any sound insulation defects.
Compulsory insurance
The seller of a building to be constructed must take out two types of insurance:
* damage insurance
The seller of a building to be constructed is legally obliged to take out insurance to cover damage covered by the ten-year guarantee, regardless of any liability claims. In the event of a latent defect covered by the ten-year guarantee, the purchaser and any successive owners of the property within ten years will be able to call on this insurance to cover the cost of repairing the construction defect.
* Liability insurance
The seller of a building to be constructed is obliged to take out insurance to cover his liability for damage covered by the ten-year guarantee. In this way, the insurer that has indemnified the purchasers will be subrogated to their rights with regard to the various participants in the construction that caused the damage. The damage insurer will therefore seek to cover the liability of architects, contractors and other persons bound to the client by a contract for the hire of work, as well as that of the seller where applicable. This is why the seller must take out this liability insurance.