Division into volumes and ASL: structuring a complex property development outside co-ownership

The choice has to be made when the operation is designed: a mixed-use complex combining ground-floor shops, offices, housing, underground car parks and sometimes a public facility built above or below does not operate like an ordinary investment building. The co-ownership regime (copropriété), which is mandatory in its field, imposes compulsory joint ownership (indivision) of the common parts and majority rules that block the decisions of an institutional investor owning a single function. Division into volumes (division en volumes), combined with a free association of property owners (association syndicale libre, or ASL), offers a robust alternative, but it shifts the risk from the statutory text to the quality of the drafting of the deeds. This guide covers the conditions for the validity of a division into volumes, the governance of the ASL, the allocation and recovery of charges, enforceability against successive purchasers and the points at which the structure fails in litigation.

When a division into volumes is preferable to the co-ownership regime

Article 1 of Law No. 65-557 of 10 July 1965 sets the scope of the regime. In the version resulting from Law No. 2018-1021 of 23 November 2018 (the ELAN Law), it applies automatically to any built property or group of built properties intended wholly or partly for residential use, the ownership of which is divided into lots among several persons. For properties or groups of properties intended for a use other than residential, the regime now applies only by express agreement. This rewording opened up, for purely commercial assets, a way out that practitioners had been waiting for.

There remains the paragraph on which most structures rely: the regime also applies to property complexes which, in addition to land, facilities and shared services, include built or unbuilt plots subject to private ownership rights, in the absence of a contrary agreement creating a different organisation.

"In the absence of a contrary agreement creating a different organisation, this Law also applies to property complexes which, in addition to land, facilities and shared services, include plots, built or unbuilt, subject to private ownership rights." (Article 1, Law of 10 July 1965)

A division into volumes is precisely that different organisation. It does not derive from any dedicated provision: it relies on Article 552 of the French Civil Code, which attaches ownership of the space above and below to the ground, and on the possibility of derogating from it by agreement, in particular by waiving the right of accession (Articles 553 and 555 of the French Civil Code). A volume is a portion of space delimited in three dimensions by altimetric levels tied to the Nivellement général de la France (the French national levelling datum), and is the subject of a separate and exclusive right of ownership. There are no jointly owned common parts, no lots and no co-ownership shares (tantièmes).

Three configurations objectively justify the use of a division into volumes rather than co-ownership. First, functional interlocking: a shopping centre with housing above it, a railway station with a commercial programme in the superstructure, a public car park beneath a private complex. Second, the involvement of a public body: the inalienability and imprescriptibility of public property, recalled by Article L. 3111-1 of the French General Code of Public Property (code général de la propriété des personnes publiques), sit uneasily with a jointly owned share in common parts subject to a mandatory regime. Third, the heterogeneity of operating regimes, where the functions do not share the same hours, the same fire safety constraints or the same works cycles.

Outside these cases, a division into volumes is fragile. The courts accept a division into volumes where it reflects a real complexity of the property complex; they do, however, accept requalifying as co-ownership an artificial division of a single building that could perfectly well have been divided into lots. The decisive criterion lies in the existence of a genuine property complex, the autonomy of the volumes and the absence of common parts disguised as volumes for collective use.

A last point on timing, often underestimated: leaving the co-ownership regime to move to a division into volumes requires the agreement of all the co-owners, since the operation removes each co-owner's joint ownership right in the common parts. The decision to divide into volumes is therefore taken upstream, when the operation is being structured, and rarely after delivery.

The technical architecture: the descriptive statement of division into volumes and reciprocal easements

The descriptive statement of division into volumes (état descriptif de division en volumes) is the key document. Prepared by a chartered land surveyor (géomètre-expert), it identifies each volume by a number, a land footprint, lower and upper NGF levels, and dimensioned section and plan drawings. It is published at the land registry (service de la publicité foncière) under the conditions of Decrees No. 55-22 of 4 January 1955 and No. 55-1350 of 14 October 1955 reforming land registration. This publication determines enforceability against third parties and the continuity of the chain of title.

The descriptive statement is not enough. It must be supplemented by a specification of obligations and easements (cahier des charges et de servitudes) that governs the physical coexistence of the volumes. Since there are no common parts, everything that in co-ownership would come under collective use must be translated into real easements: easements of support and bearing for structural works, rights of way for access and emergency exits, easements for the passage of pipes and utility networks, overhang easements, ladder-access easements (servitude de tour d'échelle) for façade maintenance, and anchoring easements for signs.

The legal technique calls for particular vigilance. Article 637 of the French Civil Code presupposes two plots belonging to different owners. Yet the easements are created by the sole owner before the division. They take effect only on the first transfer, a mechanism close to the destination du père de famille (easement by destination of the owner) of Articles 692 to 694 of the French Civil Code, provided that the deeds have described them precisely and that land registration has been correctly carried out. An easement whose footprint is poorly described, or whose dominant and servient plots have not been identified volume by volume, becomes unusable on the day a volume owner refuses access to a technical duct.

Two risks of extinction should be neutralised by contract. Merger, where the same owner brings together the dominant and servient plots (Article 705 of the French Civil Code), a frequent situation in complexes where an investor buys several volumes. And thirty years of non-use under Articles 706 and 707 of the French Civil Code, which threatens access easements that are rarely exercised. A clause restating the easements in the event of a later re-division of a volume is a minimum precaution.

As to the equipment that is genuinely shared (boiler room, chiller unit, plant rooms, internal roads), two arrangements coexist. Either this equipment is housed in a volume whose ownership is transferred to the owners' association itself, as a legal entity, which clarifies the liability of the custodian within the meaning of Article 1242 of the French Civil Code. Or it remains in a privately owned volume burdened with easements in favour of the other volumes, the manager being given only a contractual mission. The first arrangement is easier to read in litigation; it requires the articles of association to expressly authorise the association to own property.

The free association of property owners (ASL): formation, legal personality and the formalities on which everything depends

The free association of property owners (association syndicale libre) is governed by Ordinance No. 2004-632 of 1 July 2004 on associations of property owners and by its implementing Decree No. 2006-504 of 3 May 2006. Article 5 makes it a legal entity governed by private law. It is formed by the unanimous consent of the owners recorded in writing, which explains why, in practice, the articles of association are annexed to the deed of division and accepted by each purchaser on their first acquisition.

The critical formality is that of Article 8 of the Ordinance: legal personality is acquired by publication in the Journal officiel of an extract of the articles of association, after a declaration to the prefecture. The Decree of 3 May 2006 specifies the mandatory content of the articles of association, which must in particular state the purpose, the perimeter, the registered office, the bodies, the rules of operation, the method of allocating expenses and the list of properties within the perimeter. Any later amendment to the articles, and any change to the perimeter, are subject to the same declaration and publication requirements.

The consequences of a failure are drastic and are the leading cause of failure of recovery actions. An association without legal personality has no capacity to bring proceedings; its action is barred as inadmissible. Article 60 of the 2004 Ordinance had required pre-existing associations to bring their articles into conformity within two years; Law No. 2014-366 of 24 March 2014 (the ALUR Law) softened the sanction by allowing such bodies to recover their rights, and in particular the right to bring proceedings, from the publication of their articles brought into conformity. It is accepted that the situation may be regularised during the proceedings, under the conditions of Article 126 of the French Code of Civil Procedure, provided that this occurs before the judge rules. Prudence nevertheless requires checking the complete chain of publications before serving a summons, and not afterwards.

The free urban land association (association foncière urbaine libre, or AFUL), governed by the same provisions and by Article L. 322-2 of the French Town Planning Code, is a variant whose purpose is exhaustively defined, centred on the construction and management of works of collective interest. The choice between an ASL and an AFUL must be made in light of the intended statutory purpose, since an AFUL whose purpose exceeds what the Town Planning Code provides for is exposed to challenge.

Governance: freedom in the articles of association and interaction with co-ownership associations

Outside the co-ownership regime, no mandatory majority rule applies. The articles of association freely organise the owners' meeting, the board or management council, the chair and, where applicable, an external manager. This freedom is an advantage for structuring and a source of disputes.

Three parameters structure the governance and must be settled with the same care as a shareholders' agreement.

• The weighting of votes, which may be modelled on shares of charges, differentiated by group of functions, or capped to prevent a majority volume owner from imposing its decisions alone.
• The majority thresholds by type of decision: day-to-day management, improvement works, disposal of a volume belonging to the association, amendment of the articles or of the allocation key, the last two almost always requiring unanimity.
• The powers of the chair, in particular authority to bring proceedings. Unlike the property manager of a co-ownership (syndic), whose powers are framed by Decree No. 67-223 of 17 March 1967, the chair of an ASL has only the powers conferred by the articles of association. An action brought without the authorisation of the meeting, where the articles require it, is inadmissible.

The interaction with co-ownership associations (syndicats de copropriétaires) is the most delicate point in mixed-use complexes. The usual arrangement combines a primary division into volumes and a secondary division: the residential volume is itself subject to the co-ownership regime and gives rise to an association of co-owners, which becomes a member of the ASL. The property manager then represents the association of co-owners at the meeting of the ASL. It must still hold a mandate: on decisions going beyond day-to-day management, its vote requires a prior resolution of the co-ownership general meeting setting the direction of that vote, unless there is a delegation in the articles or a standing mandate expressly granted. A call for funds voted in the ASL without this relay exposes the association to a double challenge, before the judge seised by the association and before the one seised by a co-owner.

The cascade of allocation deserves to be spelled out in the deeds: the share of expenses charged by the ASL to the residential volume becomes a co-ownership charge, allocated among the lots under Article 10 of the Law of 10 July 1965. A co-owner who disputes their share is in reality disputing two successive keys, governed by two different sets of rules.

ASL charges: allocation, calls for funds and recovery

The allocation of ASL charges is governed exclusively by the articles of association. No mandatory provision requires the distinction, which applies in co-ownership, between general charges allocated according to relative value and special charges allocated according to usefulness. In practice, well-built structures set up analytical accounting by item and by group of volumes concerned: fire safety, security staff, lifts, boiler room, roads, insurance, management fees, each item receiving its own usefulness key.

The absence of a mandatory rule has a major consequence for the investor. The action for revision of the allocation of charges under Article 12 of the Law of 10 July 1965, open to a co-owner whose share exceeds by more than a quarter what it should be, has no equivalent in a division into volumes. An inequitable key, adopted when the complex was set up and frozen by a requirement of unanimity in the articles of association, can be corrected only with the agreement of those it benefits. Analysis of the key is therefore a matter of valuation, not of housekeeping. The remedies and time limits applicable in co-ownership are set out in our article on challenging the allocation of co-ownership charges.

Recovery is also governed by ordinary law, and this is where the creditor loses its best weapons. The association has neither the special real property privilege of Article 19-1 of the Law of 10 July 1965, nor the statutory mortgage of Article 19, nor the mechanism of opposition on the sale price under Article 20 of the same Law, nor the obligation placed on the notary to notify the transfer to the property manager. It acts as an unsecured creditor, on the basis of the obligation in the articles of association and Article 1103 of the French Civil Code.

The articles of association must therefore rebuild these guarantees by contract. Four provisions are useful: an obligation on the seller to notify the transfer to the chair of the association, backed by a sanction; joint liability of the seller and the purchaser for charges prior to the transfer, within the limits allowed by ordinary law; a penalty clause and late-payment interest; and the right for the association to register a protective judicial mortgage with the authorisation of the enforcement judge (juge de l'exécution), under the conditions of Articles L. 531-1 et seq. of the French Code of Civil Enforcement Procedures. Where a volume owner is in difficulty, the opening of collective proceedings requires pre-opening claims to be declared under the conditions of Article L. 622-24 of the French Commercial Code, failing which they are unenforceable, and post-opening charges are treated as privileged claims only under the conditions of Article L. 622-17. The conditions for authorising a protective registration and the chain of time limits surrounding it are analysed in our article on the provisional judicial mortgage.

Enforceability against successive purchasers and the purchaser's due diligence on a volume

Enforceability rests on Article 3 of the Ordinance of 1 July 2004, under which the rights and obligations arising from the formation of an association of property owners are attached to the properties within the perimeter and follow them into whatever hands they pass, until the association is dissolved or its perimeter reduced. Membership is therefore neither voluntary nor terminable: it is a real obligation attached to the volume. This characterisation presupposes that the perimeter has been properly published and that the chain of deeds has taken up the membership.

By contrast, the purchaser of a volume benefits from none of the protective information mechanisms available to someone acquiring a co-ownership lot. Neither the dated statement (état daté) of Article 5 of the Decree of 17 March 1967, nor the certificate of Article 20 II of the 1965 Law, nor the handover of the documents under Article L. 721-2 of the French Construction and Housing Code applies to them. Information depends on what the seller agrees to disclose and on what the preliminary agreement requires.

Due diligence must therefore be built specifically. The documents to require are well known, and their absence should be reflected in a condition precedent or a price retention:

• the descriptive statement of division into volumes, its amendments and the certificates of publication at the land registry;
• the specification of obligations and easements, with a volume-by-volume check of the footprint of the easements and of their restatement in the successive titles;
• the articles of association of the association of property owners, their amendments, and evidence of the declaration to the prefecture and of publication in the Journal officiel;
• the minutes of the meetings for the last three financial years, the budgets, the approved accounts and the statement of unpaid sums;
• the state of any pending disputes, including actions challenging resolutions and works disputes;
• the multi-year works programme and the calls for funds already voted but not yet made, which will weigh on the purchaser.

One point deserves particular attention in commercial complexes: the energy consumption reduction trajectory imposed by the Éco Énergie Tertiaire scheme (the French tertiary sector energy-efficiency scheme), arising from Decree No. 2019-771 of 23 July 2019 adopted for the application of Article L. 174-1 of the French Construction and Housing Code. In a complex divided into volumes, the façade and the equipment are not common parts; the allocation of the renovation effort depends entirely on the drafting of the easements and the works clauses. A purchaser who buys at a discount without having identified who legally bears the renovation of the building envelope is buying a deferred liability. The allocation of these obligations between landlord and tenant is dealt with in our article on the tertiary decree in commercial leases.

Points of weakness in litigation

The first risk is requalification. Where the division into volumes rests on no objective complexity, the judge may apply the co-ownership regime, Article 43 of which deems contrary clauses unwritten. The consequences are serious: calls for charges lose their basis, the association's resolutions lose their object, easements between volumes collide with the characterisation as common parts, and the value of each volume is affected. This risk is dealt with upstream, by documenting the reasons for choosing a division into volumes in the constitutive deeds.

The second risk lies in the regime for challenging resolutions. Article 42 of the Law of 10 July 1965 confines challenges to decisions of a co-ownership general meeting to a period of two months from notification. There is nothing comparable for a meeting of an association of property owners: in the absence of a provision in the articles of association, a challenge falls under the ordinary five-year limitation period of Article 2224 of the French Civil Code. A resolution passed several financial years earlier can thus be attacked after the works have been carried out and the funds called. The articles of association must provide for a contractual time limit for challenges and for methods of notifying the minutes whose proof can easily be produced.

The third risk is formal. Irregular notices, no attendance sheet, proxies not limited in number, lack of authority of the chair, unpublished amendments to the articles: each of these failures provides a ground for annulment or a bar to admissibility. In a division into volumes, formal discipline is not formalism; it is the condition of enforcement.

The fourth risk concerns decision-making. A requirement in the articles of association for unanimity on major works turns each volume owner into the holder of a veto. In a mixed-use complex where the commercial volume, the office volume and the association of co-owners do not share the same holding horizons or the same financing capacity, deadlock is structural. The answer lies in thresholds that differ according to the nature of the works, a works fund fed by contract, and an arbitration clause or a clause appointing a third-party decision-maker in the event of deadlock on works required by a regulation.

What we take from this

A division into volumes is not a technique for avoiding the co-ownership regime; it is a structuring technique justified by the real interlocking of functions, the presence of public property or the heterogeneity of operations. Chosen for the wrong reasons, it adds a risk of requalification to an already complex property complex. Chosen for the right reasons, it offers no automatic security: everything that the 1965 Law guarantees as of right, short challenge periods, a recovery privilege, information for the purchaser, judicial revision of charges, must be rebuilt through the articles of association and the specification of obligations. The structure is worth what its drafting is worth.

For an investor acquiring a volume, the recommendation is simple and practical: before any firm offer, have the descriptive statement of division into volumes, the specification of obligations and easements, and the complete chain of publications of the association of property owners, Journal officiel included, audited together. A lack of legal personality, a poorly described access easement or a charges key locked in by a unanimity requirement can no longer be negotiated after signature: they translate into a discount, a condition precedent or a decision not to proceed.

Frequently asked questions

Can a division into volumes be requalified as co-ownership? Yes, where it rests on no objective complexity of the property complex. The regime of Law No. 65-557 of 10 July 1965 is mandatory in its field, and its Article 43 deems contrary clauses unwritten. The courts accept a division into volumes where there is a real interlocking of functions, a superposition of structures or the presence of public property, and strike it down where the division conceals a single building that could be divided into lots. The reasons for choosing a division into volumes must appear in the constitutive deeds.

Must the articles of association of an ASL be published to be enforceable against a purchaser? Article 3 of Ordinance No. 2004-632 of 1 July 2004 attaches the rights and obligations to the properties within the perimeter, which they follow into whatever hands they pass. The association must still have acquired legal personality by publication in the Journal officiel of an extract of the articles of association after a declaration to the prefecture, in accordance with Article 8 of the same Ordinance, and the perimeter must have undergone the land registration formalities. Any amendment to the articles or to the perimeter must follow the same route.

How can ASL charges be challenged? The challenge concerns either the regularity of the resolution that approved the budget or the works, or the conformity of the call for funds with the key set by the articles of association. In the absence of a contractual time limit in the articles of association, the ordinary limitation period of Article 2224 of the French Civil Code applies, unlike the two-month period of Article 42 of the Law of 10 July 1965 in co-ownership. By contrast, the action for judicial revision of the allocation provided for by Article 12 of that Law has no equivalent: an inequitable key can be corrected only by amending the articles of association.

Does an ASL have the special real property privilege to recover its charges? No. The privilege of Article 19-1 of the Law of 10 July 1965, the statutory mortgage of Article 19 and the opposition on the sale price under Article 20 belong only to the association of co-owners. The association of property owners acts as an unsecured creditor. The articles of association must therefore provide for an obligation to notify the transfer, joint liability of seller and purchaser, late-payment interest and, in the event of non-payment, the association may apply to the enforcement judge for a protective judicial mortgage.

Can an association of co-owners be a member of a free association of property owners? Yes, this is the usual arrangement for mixed-use complexes with a primary division into volumes and a secondary division into co-ownership. The property manager represents the association of co-owners at the association's meeting, but its vote on decisions going beyond day-to-day management requires a prior resolution of the general meeting of co-owners setting the direction of that vote, unless the articles of association expressly provide a mandate. The association's calls for funds then become co-ownership charges allocated under Article 10 of the Law of 10 July 1965.

Can an existing co-ownership be converted into a division into volumes? The operation requires the unanimous agreement of the co-owners, since it removes their joint ownership right in the common parts and the corresponding shares (tantièmes). It also requires a new descriptive statement of division into volumes prepared by a chartered land surveyor, a specification of obligations and easements, the formation of an association of property owners and all the corresponding publications. In practice, a division into volumes is decided when the operation is designed, rarely after delivery.

Who bears the energy renovation works in a complex divided into volumes? There are no common parts: the façade, the roof and the equipment belong to the volume in which they are located. The allocation of the effort therefore depends exclusively on the specification of obligations and easements and on the works clauses in the articles of association. In commercial assets subject to the Éco Énergie Tertiaire scheme arising from Decree No. 2019-771 of 23 July 2019, the absence of a quantifiable works clause is a latent liability that a purchaser must value before making an offer.