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Everything you always wanted to know about France - from France |
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This article is reproduced with the permission of Stephen Smith of StephenSmithFranceLtd.com THE IMPORTANCE OF SEPARATE INDEPENDENT LEGAL ADVICE 1. Forewarned is forearmed This document is intended to help you understand and deal with the imperfect framework within which you must operate when buying your chosen property in France (‘the subject property’). Unless you are a French lawyer, it is unlikely to be your first choice of bedside reading. Nevertheless, it may save you a lot of money to read it carefully, more than once if necessary. In doing so you will be able also to make informed and objectively based decisions rather than trusting to luck. You should also have a much greater control over the legal, tax and practical process involved (‘French conveyancing’). Please do not be put off by the various ‘horror stories’ illustrated in this document. You should not be the victim of these and other possible problems if you take separate independent legal advice before the point when there is a legally binding contract for the purchase of the subject property. Property in many parts of France is overvalued. The subject property may have legal and/or structural problems which are not always visible to the untrained eye. As a result you may not be able to sell the subject property in years to come. None of this will usually be explained to you by the various parties involved in France, who often charge heavily for their involvement. Throughout this document stress is placed on urging you not to assume that advice and information given to you by those with a financial interest in the sale of the subject property, whatever their nationality, is accurate or truthful. By contrast, the fees you pay to your separate independent legal adviser are a fraction of what you will incur in France and he may be the only independent voice you will have throughout the transaction. Please note that in France the contract does not have to be a formal written document drawn up by lawyers. For example, an oral or written expression of serious intent, however informal or innocent it appears, can also be legally enforceable. Do not be misled by a document seeming to be a réservation only. The French word ‘réservation’ does not mean ‘reservation’ in the English sense. It is a binding contract. ‘For this and for many other reasons it is recommended that you obtain separate independent legal advice before you have even found the subject property. At Stephen Smith (France) Ltd we aim to answer your letters and e-mails within twenty four hours of receipt (usually our response is much faster) unless more time is needed to provide a detailed reply. We may however be dependent on estate agents or others in France or elsewhere to move at the same speed which, as explained below, can never be guaranteed. Do not therefore leave things till the last minute. There may be competition for the subject property, and it can be tempting to rush at this stage. Please do not allow yourself be pressured by estate agents or others into signing a preliminary contract and then hope to obtain independent legal advice about your transaction within the seven day ‘cooling off’ period that follows. You may not find someone who is available or willing to undertake urgent matters like these. Buying French property is not a decision to be taken lightly nor on impulse, even when the turnover of properties in your chosen area is fast-paced. 2. What does ‘separate independent legal advice’ mean? The term ‘legal advice’ not only covers all aspects of French conveyancing. It should also include advice on the way in which owning the subject property will affect the rights of your spouse, partner, children or others when you die. Each family situation is different. Under French succession law, your property in France does not necessarily automatically pass to your surviving spouse, even if you have made provision for it to do so in your UK will. Children (of any age) automatically inherit part of a French estate. A spouse or partner may be entitled only to a minority share, whatever the wishes of the deceased. Owning assets in France can give rise to various legal and/or tax problems, even if your family situation is not complex. Complex family situations (e.g. second marriages, stepchildren or minor children) usually need to be provided for before the point where there is a legally binding contract in order to avoid difficult circumstances later. We can advise on a number of legal solutions which may offer you more control over what happens to the subject property and other assets in France after your death. For example, should you buy jointly with your partner, and if so in what method? Do you want your children to be involved? In some cases a company may be recommended to hold the subject property. We can also ensure that our recommendations are fully implemented in France, ideally on or before you complete the purchase of the subject property. Rectifying a wrong initial decision may prove to be difficult and expensive. The terms ‘separate’ and ‘independent’ means more than just obtaining advice from a source other than the person trying to sell you the subject property. First, the advice must be unbiased and given by someone who will only act in your best interests. Secondly, your adviser must have no legal connection or other profit sharing arrangement (e.g. agency or partnership) with the seller and/or estate agent involved. Otherwise a ‘conflict of interest’ could arise. A conflict of interest occurs, for example, when a lawyer has competing professional or personal or financial interests that would make it difficult for him to fulfill his duties fairly. It may for example be difficult for a notaire (please se Footnote 1) or any other lawyer employed/recommended by an estate agent to provide you with independent advice, especially when the estate agent stands to gain a hefty commission on the sale of the subject property. As explained in (1) below, the notaire’s duties and role are not comparable to those of a lawyer in the UK, and you should not expect them to be the same. French estate agents are considered by some notaries and other lawyers to be a main source of business and income, and therefore a notaire or other lawyer recommended by these estate agents may be biased due to this business relationship. There are reported cases of notaires and other lawyers in France or in the UK deliberately ignoring or failing to investigate matters which could adversely affect the best interests of the buyer in order to profit the estate agent/seller. It is dangerous to rely on ‘advice’ given by the seller and/or estate agents mainly because: (a) they are not lawyers; and (b) unqualified advice of this nature is not backed up by professional indemnity insurance; and (c) they both have a financial stake in selling the subject property to you, which inevitably therefore means that their different interests do not coexist well with yours. Put another way, they might tell you what they want you to hear, but not necessarily what you need to know. 3. The importance of written records Beware of relying on oral comments/advice. Notaires, estate agents and others in France are used to meeting face to face rather than working via correspondence. In the event of a dispute you may have limited or no protection if you cannot prove what was actually said. It is therefore preferable for you to have a clear and accurate written record of any important statements, promises or representations made throughout your transaction. (2) Written statements may also need to be authenticated or substantiated. For example, it may be dangerous to accept the word or letter of an estate agent who says that he has written confirmation from the local planning authorities that you can build on your plot of land. You should insist on obtaining a complete copy of the documentation and have it carefully verified. 4. The importance of ad hoc advice You should consider your transaction to be unique, and therefore never rely on the anecdotal or other general advice - however well intentioned it may be given by friends or others who already own or are in the process of buying French immeubles. To take one of many examples on the theme of uniqueness, French planning and other regulations affecting French immeubles can vary markedly from region to region, and that what is permitted on one property may not be allowed on an identical property in the same locality. It is also dangerous to believe what you read in books and French property magazines. They may be a useful source of general information but can also be confusing. Moreover, in order to survive, publications like these need to make money, and do so by selling much of their advertising space to estate agents. Any ‘advice’ given in these or other publications should not necessarily therefore be treated as correct or unbiased. No publication can ever be comprehensive or upto- date. Money saved on ad hoc legal advice is money saved in the long run. 5. A case study To illustrate the initial points made so far, consider the English buyer (Mr. X) who found a French property for sale next door to a property already owned by his English friend (Mr. Y). Mr. X was persuaded by Mr. Y not to bother taking separate independent legal advice, as the estate agent and notaire would apparently do all that was required. The dozen or so properties in the cul de sac formed part of a small housing development and so were virtually identical in appearance. They all had private swimming pools, except for the property that Mr. X was interested in. Mr. X felt that a swimming pool would not only increase the market value of his property, but would also make it more attractive if he wanted to let the property to holidaymakers. Mr. X was verbally told by the estate agents that there would be no problem installing a swimming pool. They also allegedly said that they had a letter to confirm this from the planning authorities, but which they had unfortunately mislaid. The estate agents have subsequently denied saying any of the above. The seller himself (allegedly) swore blind that he would have built a swimming pool in his back garden, were it not for the fact that neither he nor any of his extended family and friends could swim. The notaire (who shared membership of the same golf club as the seller and the estate agent) allegedly told Mr. X (but did not confirm in writing) that he could not prepare a purchase contract with a condition to the effect that Mr. X could withdraw from his purchase without penalty if permission to build a swimming pool was not obtained. This was wrong advice, which the notaire subsequently also denied ever giving. What is however clear is that the notaire did not volunteer either to contact the planning authority himself or to outsource the matter to someone else to verify whether or not Mr. X could build a swimming pool on his property. Mr. X met with the planning authorities to check the position himself, but found that his poor spoken French was just as bad as the planning authorities’ command of the English language, with the result that he made no progress on the question of planning permission. Meanwhile the estate agent stressed the importance to Mr. X of making an early purchase commitment, as there was (allegedly) a queue of other people eager to buy the same property, one of whom had driven overnight from Switzerland and was poised with pen in hand ready to sign a contract which the estate agent had prepared. In haste, Mr. X read a book which (wrongly) stated that written permission is not required to build a swimming pool in France and, armed with that comfort, decided not to investigate the matter further. If all the other properties in the development had a swimming pool, then surely so could he? Mr. X bought the property and then discovered that he would need written permission to build a swimming pool on his property. He was also advised that permission would never be granted for two main reasons: (a) the title deeds to Mr. X’s property contained a clause prohibiting any kind of construction; and (b) Mr. X’ land consisted of shallow earth followed by a thick bed of rock. Even if the title deeds had not restricted construction, and the cost factor to Mr. X of excavation was not in issue, the planning authorities would not have granted permission to build a swimming pool in predominantly rocky terrain. Mr. X’s subsequent attempts to sell the property (using the same estate agents and notaire) were unsuccessful, even at a knock down price. Potential interested buyers were put off, not only by the estate agents’ pressure techniques (e.g. another very interested party had driven overnight from Switzerland etc.), but also by the reluctance of the estate agents to part with a copy of the seller’s title deed when requested, let alone produce anything else in writing (for example, a letter allegedly somewhere in their possession written by the planning authorities confirming that permission to build a swimming pool was a foregone conclusion). Other potential buyers employed separate independent legal advice which quickly diagnosed this and other problems, which cannot be fully disclosed as they are currently the subject of protracted litigation in France. Suffice to say that Mr. X and Mr. Y have a boundary dispute (and no longer speak with each other), it transpires that the original developer never obtained a ‘conformity certificate’ (see Chapter 5) issued by the planning authorities as evidence that all building works to the development as a whole had been carried out properly. The issue was raised because cracks have begun to appear in two swimming pools, and in three of the houses in the development. The developer did not have I insurance to cover these matters. Mr. X has since died without making a French will, and this has caused his family considerable heartache also. 6. The do-it-yourself approach In light of the above case study, and at the risk perhaps of sounding self-serving, it is our experience that no-one should seek to buy French immeubles relying purely on the advice of a notaire or - even worse - an estate agent, without having the documentation looked at by bilingual specialists who have knowledge not only of the French and UK French systems but, more importantly, how they interact. Despite the above warnings, those who want to carry out their own French conveyancing without separate independent legal advice usually find it difficult if not dangerous to do so. At its simplest, French conveyancing demands a detailed knowledge of French land law and tax, French planning and French contract law. French succession law is complex. As a minimum requirement, you should usually make a French will. If you are domiciled in the UK, the process also requires a detailed knowledge not only of French succession law but also of UK taxation and inheritance law. Hence the need to obtain advice from someone familiar with the laws and practices of both systems and how they interact with each other. 7. French law, language and translations All formal documents relating to French conveyancing must be written in the French language and are always governed by French law, regardless of the nationality, residence or domicile of the parties. The parties cannot therefore designate a different foreign law or language of their choice. The language of French lawyers is seen by many as a quaint and at times irritating archaism. The truth of the matter is that lawyers and other professionals in any country have their own technical language. Do not therefore sign any document in French without knowing precisely the scope of your commitment in plain English. Even if you sign an extract or summary in English, it is usually solely the full French version which will prevail. Do not presume that it is a legal defense to claim that the document in French was not understood. Ignorance of the law and language (in any country) is no excuse. If the French authorities think that your command of the French language is inadequate to fully understand what is happening, they may insist that you appoint a qualified translator in France throughout or on completion of the French conveyancing transaction, the costs of which may be significantly higher than the costs of engaging a separate independent legal adviser. Many oral or written translations are incorrect, misleading or make nonsense reading. To provide translations in wholly ‘correct’ legal phraseology wrongly implies that French law is the same as English law. For example, the English meaning of French words like domicile, construction and contrat de réservation is different. In any event, you are legally bound by the terms of documents written in the French language, not English translations. Independent explanation of the legal implications of these documents is therefore far more important than socalled translations. For the above reasons your separate independent legal adviser should be able to communicate with you in plain English, and also communicate with French professionals in the technical language they understand. This usually requires a degree of seniority and experience. For example, a senior Partner of a firm of lawyers in France may find it difficult to deal with a junior employee in a firm of lawyers in England. He will usually insist on speaking with his English counterpart. For this and other reasons you should establish from the outset precisely who will have the day-to-day conduct of your matter. Will it be a senior lawyer or will your file in fact be dealt with by a junior member of staff or a secretary? To avoid unnecessary confusion or duplication of work, there should only be one person responsible for the handling of your transaction. That person should where necessary be sufficiently senior to ‘pull rank’ within the administration of his firm, for example putting you at the top of any typing backlog (which can sometimes be behind by several days or more) to ensure that your best interests are given priority. We place great emphasis on our practical experience (and not just theoretical textbook knowledge) built up through acting in thousands of French conveyancing transactions. The practical experience of owning French property oneself is also an advantage. The level of bilingual expertise normally required to deal with your French matters warrants the involvement of someone senior at all times. There are few Partners or other lawyers in England who speak French (or French lawyers who speak English) to a high technical level. Some claim to be bilingual, but in fact are not. Having a bilingual secretary to field your calls or an inexperienced junior handling your case is not good enough. If the person dealing with your case is not in charge of the department that deals with French property and associated matters (which is presumably insured for this specialist type of work), you can ask the person with overall responsibility for supervision of that department and of your case-handler to confirm to you in writing his precise status within the structure of his firm, and whether he can understand, speak, read and write French at technical level without recourse to others. Although office politics may be invisible to you, it can have an adverse influence on your transaction, especially if the interests of the office rank in priority to yours. Behind the scenes office politics in any country can adversely affect your transaction and be damaging. It therefore pays to engage independent lawyers who offer a personal service and work as an informal and approachable team. 8. French office mentality Language and other barriers apart, conveyancing in France can be a relatively slow process, and the personalities involved in France are not always consumer friendly, whether they are dealing with ‘foreigners’ or their own nationals. Many buyers do not have the patience and diplomacy needed for dealing with the various cultural differences and French bureaucrats (local and national) who handle their transaction. Many French professionals appear reluctant to use fax and e-mail to speed up the process. Other obstructive behaviour includes failure to reply to telephone messages and to deny ever having received other communications (2). Some French professionals are very reliable, but others have a habit of disappearing for days on end and for never sticking to deadlines that they themselves set. As previously stated in Paragraph 2.3 above, notaires, estate agents and others in France are used to meeting face to face rather than working via correspondence. In the event of a dispute you may have limited or no protection if you cannot prove what was actually said (3). Interestingly, many buyers who carry out their own transaction without separate independent legal advice blame the estate agent and/or notaire for any problems that arise. Under French law, a person is negligent if his error or mistake causes someone to suffer loss or damage. Even if these or other problems result in the buyer suffering reasonably foreseeable financial loss, recourse to the French courts should always be viewed as a measure of last resort. (3) A claim in damages for a ‘ruined holiday’ in France or other loss that cannot be quantified in financial terms is unlikely to succeed. 9. Why should you choose Stephen Smith (France) Ltd? At Stephen Smith (France) Ltd we and, on those rare occasions where necessary, our network of notaries and other qualified lawyers, surveyors, accountants etc. throughout France can act as your intermediary. We listen carefully to you and work side by side with you to provide the in-depth advice and individual solutions tailored to your needs. We are proud of our independence, and take steps to ensure that our clients are kept fully informed of progress, and understand each stage of their transaction. We will never try to sell you a particular mortgage, life assurance or other financial product. As explained in Paragraph 2. above, this is because it would be difficult for us to provide you with truly independent advice if we stand to gain a hefty commission. We can however put clients in touch with recommended financial or other advisers. We do not ask for or accept commission for referrals of any nature. We only refer you if we are convinced that you will be given the same quality of service as you expect from us. All of this means that we have no financial interest in whether or not you decide ultimately to purchase a particular property in France. This also means that we have no difficulty in telling you the truth, which in some transactions means having to advise you not to go ahead. You are of course free at all times not to take our advice as you see fit. We recognize that mistakes can sometimes occur. We hold substantial professional indemnity insurance cover which means that we (unlike some others) will be in a position to compensate for financial losses that arise in the unlikely event that we make a mistake. By contrast, you cannot take out insurance against mistakes made by notaires or estate agents. We cannot accept responsibility for the work that they or others undertake on your behalf and over whom we have no control. You should always obtain and agree in writing a prior written quote or estimate of the fees your separate independent legal adviser will charge. A common basis is 1% of the purchase price for the transfer of the subject property, plus additional fees for French wills or similar estate planning matters. Some independent legal advisers will charge on an hourly rate based on daily time recording. There are two potential problems with this system. The first problem is this: fee earners are often under such pressure from their superiors to meet annual financial targets that the temptation to overcharge is great. The second problem is that it is virtually impossible for you to accurately police the amount of time that has truly been spent on your matter. Other advisers will offer a fixed fee (which is usually better value) determined partly by the value of the subject property and partly by the range and complexity of the services to be provided. Our competitive fee structures are tailored as best possible to your specific current needs, and how they may evolve as years go by.. These needs (and our fees) will vary depending for example on whether you are looking to use the subject property as a second home or to make an investment, whether you plan to relocate and work in France, or whether you intend to set up a business or even retire to France. Some advisers will also routinely charge UK VAT at 17.5% on all transactions involving French law, when in fact they should not usually do so (4). By instructing us in the UK, rather than instructing a lawyer in France direct, we may sometimes also be able to save you paying French VAT at 19.6%. (4) If, despite reading all of this document, the additional expense of taking separate independent legal advice is still a deterrent, please remember that much more of your money may need to be spent in putting an undiagnosed problem right. If a problem arises, you may not find an independent legal adviser who is available or wiling to deal with your matter. In any event, remedial action may not be possible. To echo what I said at the beginning of this document, the fees you pay to your separate independent legal adviser are a fraction of what you will incur in France, and he may be the only independent voice you will have throughout the transaction. FOOTNOTES (1) It is impossible for a buyer to do all his own French conveyancing. This is because the formal legal documentation required to transfer ownership of the subject property can only be prepared by and signed in the presence of a notaire, who must be in practice on French soil and nowhere ele. Some usually estate agents often argue that there is therefore no point in instructing solicitors, barristers, Notaries Public or other ‘foreign’ lawyers based in the UK (including French avocats or notaries based in the UK) or elsewhere to intervene on your behalf. This is only true to the extent that notaires in France currently monopolise the preparation of the legal paperwork and formalities required to complete the purchase of French immeubles. This does not however mean that others should be prevented from giving separate independent legal advice. Ultimately it matters not one jot what paper qualifications (e.g. barrister or solicitor) you possess. What matters is that you have the practical experience necessary which is backed by substantial professional indemnity insurance. The notaire will not usually protect or act in your best interests. In fact, the notaire represents both the buyer and the seller in the French conveyancing and is therefore required to be neutral. Although you are his client, and pay him his fees, the notaire is only usually answerable to the French State which he represents. Much of the day-to-day paperwork involved in French conveyancing is not handled personally by a notaire but by one of his unqualified clercs or secretaries. There are very few notaires who can speak English very well and also have a detailed knowledge of UK law and procedures. Practice shows that most notaires dealing with ‘foreigners’ do not advise on all the legal consequences of cross-border issues such as international succession and/or tax planning matters. If they do advise at all it is not unusual to see a notaire suggesting a French solution which may impact badly on the clients’ position in his home country. (In the same way, an English solution proposed by an English lawyer to a French legal problem is not usually appropriate, and can instead be damaging to the client.) Even if cross-border matters are not an issue, most notaires do not see their remit as giving ad hoc advice about French law. Some notaries are openly hostile to clients who expect them to deal with their transaction in an active rather than a passive manner. For example, in one recent case, the notaire said that he not going to act like Zorro for his client. Another notaire systematically refuses to be on sentry duty (i.e. to play an active rather than a passive role) for his clients. Any advice given to a buyer will not usually be volunteered by the notaire. It will instead only usually be given if the buyer asks the notaire specific questions. To put it another way, a notaire is not negligent for not having answered a question that he has not been asked. This presupposes that the buyer knows precisely what questions to ask in the first place! Where the buyer is a ‘foreigner’, even the most skilled of notaires may not appreciate the level of ignorance shown by his client about French law and practice. In a recent case Mr D sued his notaire who had dealt with the conveyancing of a newly built house in France. The house developed cracks and other structural faults which were due to poor construction. The developer did not have insurance to deal with such matters. The notaire had mentioned this point in the French conveyance deed, but did not draw this important matter to Mr D’s particular attention when he completed the transaction in person at the notaire’s offices. The matter went to the French Supreme Court who decided that, because the conveyance deed prepared by the notaire expressly referred to the absence of insurance, the notaire was under no legal obligation to draw the matter to Mr D’s particular attention. In England, lawyers are aware - and usually take steps to ensure that when advising those who seem to have little knowledge of the English legal system or indeed the language, their advice has been understood. This duty was confirmed by the House of Lords in a 2002 case where the client was Ugandan and did not speak English. The House of Lords made clear that special steps should be taken in advising people like this. In France, however, although the Montpellier Court of Appeal decided in 1997 that in advising my English client (and by implication any other ‘foreign client’) notaries were under ‘a special duty and obligation to ensure that their advice has been understood’, this decision has been systematically ignored by French notaries. This is partly because in France there is no legal doctrine of cases being binding as there is in the UK (‘doctrine of precedent’). The decision of the Montpellier Court above is therefore treated by notaries as being for guidance purposes only, and is not legally binding. In the UK a lawyer cannot accept instructions to act for two or more clients (e.g. buyer and seller) in the same conveyancing transaction where there is a conflict or significant risk of conflict between the interests of those clients. In France the notaire (who incidentally can also act as an estate agent) routinely acts for both the buyer and the seller. It is understandably difficult for a notaire to act in the best interests of you (a ‘foreigner’) if he has known the local seller and/or the estate agent, with whom he may be on best terms, for many years. The notaire is usually appointed by the estate agents or the seller, although the buyer can insist on appointing his own notaire at no extra cost. In appropriate cases we can recommend a notaire from our network throughout France. The notaire is not usually appointed to act in a French conveyancing transaction until after a legally binding contract has been entered into between the parties. The period in which the notaire is usually involved is when the original contract is ‘engrossed’ in deed form (acte de vente) and signed by the parties. This completes the transaction (hence the term ‘completion’). Even if a notaire is instructed by you before you enter into a legally binding contract, his obligations are limited. For example, he will not find out if there are any plans to put a new motorway through or near the subject property. The notaire will not routinely make what in the UK are described as ‘preliminary enquiries’ of the seller and/or the local authority. As explained in Chapter 3, these enquiries and questions should be made at the beginning of the transaction following a reading of the purchase contract and an inspection of the seller’s title documents. Enquiries made at this stage typically cover matters concerning the ownership of boundary walls, rights of others to cross or use the subject property, planning problems, mains services and any disputes involving the subject property, among other issues. In the case of an apartment or other leasehold property, different questions should be asked. These enquiries are important because (as explained in Chapter 3) the seller is under a very limited duty to disclose legal or structural defects in the subject property. The seller is not legally obliged to answer any questions, but responses that are deliberately untruthful may make him or his agents liable for misrepresentation and/or give rise to liability in negligence in France. Before the notaire can prepare the legal documents transferring ownership of the subject property to the buyer, he must check that the seller’s background title is in legal order. This involves him checking that all the links in the chain of previous ownership, usually over at least the last 30 years (including dispositions following any death/divorce, gift or sale of part, mortgages and other debts etc) are unbroken. If any documents are missing, he must establish why. Inspecting the seller’s title deeds before you enter into a legally binding commitment is however preferable to dealing with matters at a late stage in the transaction. For example, the seller’s title deeds will indicate whether or not the subject property is freehold or leasehold. If the title deeds state that the owners of the subject property are a married couple, questions must be asked if only one person is now selling the property. Is this because one owner has died or because of a divorce? If so, what formal legal evidence exists to confirm that title to the subject property now belongs to and has been registered in the name of the individual seller? If for example the title deeds describe the subject property as ‘a cow barn situated in 20 hectares of land’, and the estate agent’s particulars describe the subject property as ‘a residential dwelling situated in 15 hectares of land’, checks should be made to verify that all the necessary French planning documents were obtained permitting the conversion and change of use of agricultural premises (the cow barn) into habitable quarters. Enquiries should also be made to explain the ‘missing’ 5 hectares of land. Were they sold to a third party (in which case, where are the boundaries), or are they the subject of an ongoing land dispute? Insurance is theoretically available to cover situations where it transpires that the seller’s title to sell French immeubles is defective. However, for the reasons explained above, the expense of such cover is no substitute for checking (via the notaire or your independent legal advisers) from the outset that the seller has a clear unbroken title to the subject property. Lawyers in the UK complain at the bad press they sometimes get. This is nothing compared to the reputation of the notaire within France itself. The concept of inadequate professional service in France is not as developed or regulated as it is in the UK. In the UK if a lawyer is slow and unable to organize his time in a diligent and professional manner, he might be considered as providing an inadequate professional service. Notaires in France do not face similar rules. It is not reassuring to note that, according to French statistics, more than 80 per cent of buyers and sellers (of any nationality) are unhappy with the level of service provided by their notaire. The rules of conduct of a notaire are enforced by the local Chambre in which reside all the necessary disciplinary powers. However, the profession is zealous in the protection of its members against complaints made by the public, which rarely have a positive impact. A notaire may be sued in negligence but it would be fair to say that this is not a course of action which is likely to result in success. (2) E-mail or fax is an ideal method of communication, since it is a written and dated record which may be copied in to other parties and instantly sends documents as an attachment. Parties to French conveyancing transactions are frequently required by law to address each other by registered letter (the French call this ‘LRAR’). Even when the law does not so require, they should use this means of communication in all dealings with French estate agents and notaires. Indeed, every legal or business communication of any significance in France, irrespective of who is the sender and who the recipient, should go by registered post, whether the law requires it or not. French offices have the habit of not receiving letters, which allows them not to reply to them, and the only manner therefore in which the sender of any documents can protect himself is by the use of this relatively expensive form of postage. (3) Avocats deal mainly but not exclusively with contentious matters in France. Legal disputes relating to French immeubles are usually always subject to the exclusive jurisdiction of the French courts. Since an excellent rule for the non-French to observe is never to become involved, if it is at all possible, in litigation in France, an avocat is not a professional whom you are likely to meet. Litigation in France can be extremely slow and the French have a tendency to appeal any unfavourable decision since this puts off the evil day for a long period. Even if you win the case your avocat’s fees must usually be paid by you in full and not by the losing party. (4) Under UK tax law, charges in connection with work directly relating to the purchase or sale by UK residents of residential property in France are not subject to UK VAT. However, charges incurred in connection with work not directly relating to the above matters (e.g. the preparation of French wills) are within the scope of UK VAT at the current rate of 17.5%. Under French tax law, all professional costs and disbursements you incur in connection with services undertaken by professionals in France on your behalf (whether or not directly relating to a purchase or sale of residential property in France) attract French VAT (‘TVA’) at the current rate of 19.6%, unless you are registered for French VAT purposes. If you are not registered for the purposes of VAT in France, we may be able to mitigate your TVA liability by instructing French professionals ourselves. Their services to us would not usually attract TVA at 19.6%. This article is reproduced with the permission of Stephen Smith of StephenSmithFranceLtd.com There are over 2,000 features and articles on this site about French life and living in France. You can search from the search box above. Do browse through our website and please use the advertising links, they help pay for the site. I do try to reply to all mail - Contact Me - most is about property or living in France. I publish comments in this newsletter which I believe are of interest and may help find answers for people wanting to come to France. I hope readers will go to the adverts which help support our overheads. |