Background
In 2011, a municipality adopted a local urban plan confirming that a parcel later acquired by Terrains 64 was suitable for development as a residential subdivision. At the request of neighboring landowner M. [K], an administrative appellate court upheld the annulment of that planning decision in 2016.
Terrains 64 and M. [K] entered into a settlement on February 1, 2018. M. [K] agreed not to bring administrative or judicial challenges against any future development permit for the project, while Terrains 64 agreed to convey him land adjoining his property. After a new local plan designated the project site as buildable and Terrains 64 obtained a development permit, the parties signed a June 1, 2019 addendum incorporating the transferred parcel into the subdivision as Lot 17.
Terrains 64 later sought to invalidate the settlement and addendum under Article L. 600-8 of the Urban Planning Code because they had not been registered with the tax administration. The Pau Court of Appeal rejected its claims, and Terrains 64 appealed to the Court of Cassation.
The Court’s Holding
The Court of Cassation dismissed the appeal. It held that, under the version of Article L. 600-8 applicable to the settlement, the one-month tax-registration requirement covered only settlements made in connection with an action to annul a building, demolition, or development permit that was still pending before an administrative court.
No administrative proceeding brought by M. [K] remained pending when the parties executed the February 2018 settlement. The settlement therefore was not subject to Article L. 600-8’s registration requirement, even though M. [K] promised not to challenge future planning authorizations. The June 2019 addendum was not autonomous and followed the same legal regime as the original settlement.
The Court accordingly upheld the rejection of Terrains 64’s requests to invalidate the agreements and recover compensation for alleged tax and material losses. It also ordered Terrains 64 to pay the costs and €3,000 to M. [K] under Article 700 of the Code of Civil Procedure.
Key Takeaways
- Under the pre-November 23, 2018 version of Article L. 600-8, mandatory tax registration applied only when a settlement concerned a permit-annulment action still pending before an administrative court.
- An agreement not to bring future challenges fell outside that version of the statute when no relevant administrative proceeding was pending at the time of execution.
- A non-autonomous addendum expressly tied to the original settlement follows the original agreement’s legal regime.
Why It Matters
The decision draws a clear temporal boundary around the former version of Article L. 600-8. A party cannot invoke its registration sanctions merely because a settlement was intended to prevent renewed litigation over the same development; a qualifying permit challenge had to be pending when the settlement was concluded.
The ruling also underscores the importance of identifying which statutory version governs a planning settlement. Later amendments expanding the provision’s scope do not retroactively determine the registration obligations applicable to an earlier agreement.