Court of Cassation Reaffirms Rural Lease Preemption Right
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Rural lease preemption right, tenant preemption right, public order, preferential agreement, conventional nature, rural lease agreement, preemption right, lessor/seller, operating lessee, SCEA, Civil Agricultural Exploitation Society, Rural and Maritime Fisheries Code, L412-1, L412-4, fraudulent agreement, Court of Cassation, Court of Appeal, Aix-en-Provence, rural lease, preemptive right, lessee, preferential pact, sale annulment, fraudulent concert, bad faith, restrictive clauses, jurisprudence, Cassation Court decision, judicial facts, factual circumstances, agricultural law, land law, property law, lease agreement, preemption, rural land, tenant rights, lessor rights
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Abstract
The Court of Cassation rules that a rural tenant's preemption right takes precedence over a preferential agreement, reaffirming its public order nature.
Extract
[...] The Court of Cassation, in a joined case, quashes and annuls the decision of the Court of Appeal. The claims of the parties - The SCEA argues that the rural tenant's right of preemption takes precedence over the preferential agreement concluded with a third party, and that, consequently, the sale of 29 August 2014 is perfectly valid. - The defendant party, on the other hand, estimates that there is a fraud, because the lessor/seller had committed to selling the disputed plots to him for a period of 25 years in priority under the preferential agreement. [...]
[...] 3e civ Oct Cass. 3e civ Oct. 1982). The precision brought by the present judgment is that a fraudulent agreement cannot be characterized by the mere knowledge of the tenant to a lease of a preferential agreement. In the light of this decision, we can affirm that the right of preemption can only be set aside in the presence of a real fraud, possibly characterized by acts of bad faith. [...]
[...] Court of Cassation, Civil Chamber 11 January 2024, no. 21-24.580 - Does the right of preemption of a rural tenant take precedence over a preferential agreement concluded by the landlord/seller in favor of a third party? - Case summary The facts Factual circumstances : On 15 March 2005, a landlord, a natural person, concluded a rural lease agreement covering plots in favor of a civil agricultural exploitation society (SCEA). On 26 August 2006, another natural person acquired a castle as well as the aforementioned plots belonging to the aforementioned landlord and his mother under a preferential agreement concluded for a period of 25 years. [...]
[...] Sense of the judgment In this decision, the Court of Cassation reaffirms the public order nature of the tenant's rural lease preemption right. The rural lease being a contract for the rental of agricultural land or buildings by a landlord (lessor) to an operator (tenant). This contract confers on the tenant a preemption right allowing him to be prioritized in the event that the lessor wishes to sell. It is of public order and takes precedence over any other agreement, even if there is a preferential pact allowing the lessor to give priority to the sale to the beneficiary of said pact. [...]
[...] thus the The Court of Cassation reaffirms the precedence of the right of preemption over any other contrary clause. The judges confirm the public order nature of the right of preemption, they only apply literally the aforementioned provisions. As for fraud, a potential obstacle to the exercise of this right, it has not been demonstrated, because the mere knowledge of the preferential agreement by the tenant does not taint his right. This is a legal reasoning that makes sense as soon as no act of bad faith has been characterized. [...]
