A French insurance company refuses to accept a claim under the ten year building insurance guarantee due to late commencement of the contract.

As is the case in most other countries of Europe, in France there exists a 10-year latent building defects guarantee.

The guarantee is called the la responsabilité civile décennale/la garantie décennale.

In order to provide a secure framework to the system, builders and architects are required to take out an insurance policy should they face a claim (although it is not obligatory for sub-contractors to do so on a building project).

This insurance is called l’assurance responsabilité civile décennale.

In a recent case heard in the French Supreme Court, the Cour de Cassation, a builder commenced works on the construction of a new dwelling on which he had been engaged by a couple.

A few days after works had started the builder entered into a contract with their insurer for the ten year building guarantee.

The formal declaration of the commencement of works was not actually notified to the local planning authority until after this date.

A year later, for reasons not stated in court, the builder abandoned the site with the dwelling incomplete.

Following a major storm that year substantial damage occurred to the property.

The couple arranged for another builder to complete the works.

They also sought to invoke the ten year insurance policy of their original builder on the basis of the discovery of new defects in their workmanship.

The insurance company contested their liability on the basis that:

• the policy only covered a range of building works, but not the construction of a new dwelling
• the policy was taken out after commencement of the works;
• there had been no handover of the property to the client, as was required in order to invoke the ten year guarantee.

The court determined that on the first count there was no need for the policy to cover specifically the construction of a dwelling, as the activities declared by the builder covered the main elements necessary in the work.

However, as the policy was taken out after works commenced it was not operative. 

We considered the problems and more general confusion about building insurance in France in our article on Building Warranties Against Latent Defects.