Summary of the Maastricht Private Law Lecture presented by Prof. dr. Vincent Sagaert

by: in Law

Does a little piece of feudalism in property law contribute to sustainability? The addressed topic was delivered by distinguished scholar Prof. dr. Vincent Sagaert and related to the general principles of property law reform, with the topic of the lecture being: "The Codification of Property Law: A Search for Principles in an Integrated Private Law".

On the 22nd of April, the Maastricht Department of Private Law had the honour to host the Third Maastricht Private Law Lecture, delivered by distinguished scholar Prof. dr. Vincent Sagaert. The addressed topic related to the general principles of property law reform, with the topic of the lecture being: "The Codification of Property Law: A Search for Principles in an Integrated Private Law".

Prof. dr. Vincent Sagaert is a Full Professor of Private Law, with the focus on Private Property Law, and a Director of the Research Institute of Property Law at the University of Leuven. He led a law reform of Property Law in Belgium, together with the University of Liège Law School. Prof. Sagaert was a member of the Expert Committee, which drafted the Act reforming Property Security Law on Movables (2013) and co-directed the Reform of Condominium Law (2018). He has made significant contributions to the new Book on Property Law of the new Belgian Civil Code, by being one of the two drafters of the piece of legislation coming into force on 1 September 2021. Prof. Sagaert has always combined work in academia with private practice, as he was admitted to the Brussels bar at the Law Office Eubelius in 2003.

The event began with a warm welcome from the Dean of the Faculty of Law, Prof. dr. Jan M. Smits, and then followed by his co-host, Dr. Bram Akkermans. In his introduction, Dr. Bram Akkermans shared his real pleasure to have collaborated with Prof. dr. Vincent Sagaert in the past, with the first connection being the Ius Commune Prize in 2001, and a further joint effort on providing the “Ius Commune Casebook on Property Law” - a rich contribution dealing with property security rights.

The lecture delivered by Prof. dr. Vincent Sagaert was about a principled approach for the codification of property law. He began with the famous wordings of Jean Carbonnier: “Codification of law is always a moment of closing the past and opening the perspective to the future.”, and moved on to distinguishing the basic principles of ‘modern’ property law from so-called Napoleonic property law of the early 19th century. The latter is often considered to be the initiation of the modern era for property law in the Western European Civil law countries. When analysing the codification of the property law in the early 19th century, it seems that the main ambition of the Napoleonic codification committee was to retrospectively progress from 18th century feudal foundation. Prof. Sagaert has detected four main pillars of property law of Napoleonic Civil Code: (1) the concept of Anti-feudal ownership, grounding the importance of individual freedom; (2) Ownership as the main source of exclusion in society; (3) Abundance of resources to serve humanity; (4) Exclusive perspective on corporeal real estate (the total absence of attention for incorporeal and immovables). The 1804 Civil Code was building on a specific context and was very much policy-oriented.

The sustainability of the French Civil Code emerged to be more limited than Napoleon expected himself. In the early 19th century, French law was the model law, however, its position had degraded rapidly in the course of the 20th century, yielding to the German Bürgerliches Gesetzbuch. At that time, German codification appeared to be much more influential to Western and Eastern Europe, whereby the French Code was considered to be an untouchable, unamendable instrument. The lack of flexible development of the French Civil Code finally resolved in its self-destruction. The occasion of the bicentenary of the French Civil Code in 2004, marked the beginning of a huge reform project from inside the system. Particularly for property law, it was a hazardous, difficult exercise. The reason for that is, according to Prof. Sagaert, property law gives the basement for private law and directly affects human relations. To quote JW Singer, “Property law is the law of democracy”. The French legislator has succeeded in reforming property security rights in 2006, in reforming the succession law in 2007, in introducing the new law of obligations in 2016, and has managed to introduce fiducie in 2007, but it has failed to reform property law, which, at its core, has too many sacred principles and religious worth.

However, the aftermath of the reform of the French Civil Code, was an initiative launched by the Belgian Minister of Justice for the reform of the full Belgian Private Law, which includes the reform of property law. The draft statute of the reform of property law in Belgium was finally approved on 3 February 2020 and will enter into force on 1 September 2021. The main part of Belgian property law had remained unchanged since 1804. As it had become clear, the 19th century leading principles have lost their weight and, as a consequence, the most fundamental work arising at the beginning of the work in 2016, was to define counter-pillars for the re-codification of property law. The 19th century legislators did not have any perspective for the tragedy of the anticommons, as a direct effect of the absoluteness of ownership. They did not take into account making their laws more sustainable, and there was no perspective about the need for an optimisation of the use of land. Property rights to use were not considered as minor, but even as a possible threat towards ownership. However, property rights to use have regained the importance in many legal systems, in the early 21st century. Demographic developments and democratisation of the access to land have made their lands more expensive. Paradoxically, many can only acquire use rights instead of ownership. The influence of housing law and the influence of tax law has further increased the role of limited property rights in property law. Subsequently, the growing importance of use rights requires a more coherent, systemic, and normative approach.

The property law house does not only need to have separate rules and separate property rights, but it also needs to have an atrium, a common space, in order to provide space for co-existence of these property rights, which was completely absent at the beginning of the 19th century. These leading principles and ground rules were already detected by a fellow professor, Prof Dr Mr Sjef van Erp, in 2007, and, in the last two decades, further developed by the Maastricht Property Law School. They have played a major role in the development of statutes and instruments in Belgium.

The first Title of the new Property Law in Belgium is an ‘umbrella’ chapter covering all property rights with 37 provisions. In search for leading principles in the re-codification, Prof. Sagaert further referred to the principles given in Prof Sjef van Erp’s lecture: (1) Standardisation of property rights; (2) Transparency of property rights. However, the third dimension was also added to the leading principles: (3) Sustainability of property law (Akkermans, “Sustainable property law?”, European Property Law Journal, 7(1), 1-3). It is quintessential for the codification of property law to use leading principles in a pragmatic matter. It essential in codification to apply them, and not to conceptualise them. Prof. Sagaert has further demonstrated it along the three leading principles.

The first principle is the standardisation. According to Prof Sjef van Erp, the leading principle in the most national legal systems is numerus clausus. This determines the extent to which party autonomy is allowed, as well as economic function, and the connected flexibility of property rights. In drafting private law rules, there is always a certain difficulty in choosing between legal theory on one hand and legal practice on the other. In property law theory, scholars fiercely defend the need for standardisation. Standardisation of property rights would simply enhance human relations and legal certainty, both from legal-economic perspective and social-legal one. The focus should also be on the voice of legal practice, especially the real estate legal practice. According to Professor Dirix, more party autonomy creates more sustainability for law statutes. Moreover, in Belgian law, the influence of French law must be taken into account: “If it rains in Paris, it begins to drop in Brussels”. The outcome of this tension between the need for standardisation on the one hand, and the need for party autonomy on the other, must be a balanced, functional system. Belgian law, in its codification, acknowledges four categories of property rights: ownership, co-ownership, property rights to use, and property security rights. However, the counterweight for this closed system of this property is Article 3.1 CC, which states that in principle, parties are free to contractually derogate from the statutory provisions. This should ensure that Belgian property law is a flexible system, where it is possible to protect certain interests in legal practice. The acknowledgement and integration of contractual freedom is one of the ambitions of property law and of the property law reform, in order to safeguard the sustainability of the statutes.

The second leading principle is transparency of property rights, which is traditionally guaranteed by means of possession of movables and registration of immovables. Property rights have effect against the whole world and must be known by the whole world. This principle should be applied in a functional way. According to Prof. Sagaert, in almost all national legal systems, with the exception of Swiss law, there is a very notable exception to the leading principle of property law within the field of property security rights: retention of title. A seller under title retention can exercise his security device and can make his retention of title effective towards the whole world, without having to comply with any publicity requirements. The key argument for this solution is a legal-economic argument: a publicity requirement for a commercial security right as a retention of title, would be too much of a burden and would, to a much greater extent, hinder rapid commercial business transactions, and if no other commercial trade partners of your own legal system introduces publicity requirements, then a less advantageable position will not be created. The Belgian law has permitted the new Book on the Civil Property Law for the holder of a right of pre-emption and for the holder of a purchase option, to give extra legal effect to these rights by making it publicly available, and by registering it in the Belgian land registry, in order to overcome for the sake of transparency the form of distinctions between personal rights and property rights.

The third leading principle of the property law is sustainability of property law. Sustainability has two dimensions: sustainability of the Code, and property law as a source of sustainability for society. Property law directly impacts the sustainability of society. The law of things should be about the sustainability of things. Property law should be the law that deals with the powers we can exercise on things. The fundamental principles which grounded the codifications in the early 19th century are, by nature, unsustainable. An owner must take into account the societal impact of his ownership. The 1804 Civil code defined ownership as an owner that has the right to use in the most absolute manner. With the recent shift, in Belgian law, the owner still has a full right but will have to take into account several reflections of the commons in the exercise of his property rights, in order to avoid the tragedy of the anticommons from happening. As Jean Carbonnier pointed out in 2004, property law should be rather feudal. An example of the sustainability idea in the new Belgian law is the idea of balancing property interests by allowing a preventative nuisance action. If there is a risk for safety or pollution, then a neighbour can initiate judicial proceedings in order to prevent a certain exercise of the ownership: they would not have to wait until the infringement has occurred, but can instead prevent it from happening, having sustainability as the common ground for such an action. Another example of a sustainable approach in property law is not only the use of land on its flat surface, but also the importance to give attention for the third dimension of property: the optimisation in height and depth; ownership of volumes. There is a possibility to create property of volumes and underneath each other (exclusion of accession), in order to safeguard the unbuilt land. Sustainability is also reflected in a way in which we deal with animals. ‘De minimis’ rules for land ownership – rules for interferences by third parties. When a landowner does not put his own land to use, then he should not oppose third parties using for purposes such as walking on it. There are also specific rules towards unlawful vegetation. In addition, sustainability depends not only on the way we use our private resource but also in which we use public resources, e.g., scarcity of fresh air, clean water and etc. 2021 codification should take into account the way in which we use common resources, however, it is still a topic for public debate. There is also some attention given to the sustainability relating to the use of water. As of now, legislators have not created direct obligations, in order to enhance and achieve certain environmental goals. Environmental powers in Belgium are regional and not federal. We have stepped over the dogma that ownership cannot create positive obligations, but we did not pass the river in order to connect it immediately to the environment.

Prof. dr. Vincent Sagaert has tried to demonstrate that it is of utmost importance to present these principles in a functional manner, through specific applications. He noted that legislators, when codifying law, should avoid making the mistake attributed to Napoleon: we should avoid creating new sacred principles, we should avoid causing new religious wars. If the dogmas would affect the abstract system, then it would have made the new Civil Code too vulnerable. Functionalisation of the dogmas in codification should be not by presenting them as strict principles but incorporating them in specific provisions and applications. In this sense, the new Civil Code should be beyond the dogmas. To conclude with a question: does a little piece of feudalism in property law contribute to sustainability? Does a little piece of feudalism create a little piece of heaven?

Written by Milana Ulitina, M-EPLI intern