The Viager System

The story of Me Jean-François Affray and Jeanne Calment  (in her 120th year) is uniquely French ... and you couldn’t make it up. One day in 1965 Affray, a notaire in the southern city of Arles, approached Calment, then aged ninety and frail looking, and asked whether she would be interested in signing a contrat viager with him. This has no equivalent, as far a I know, in other legal systems, and my Oxford French-English Dictionary’s glossing of viager as “a lifetime annuity” is not very helpful. Briefly, under such a contract one party (the buyer) agrees to pay the other (the seller who owns a property) an amount of money – split between an initial lump sum and regular monthly payments – with the right to take over the house or apartment on the other’s death. In the case of Jeanne Calment this looked a very good deal to Me Affray who was convinced that within a few years he would acquire at a knock-down price a house with a significant market value. The problem was that Mme Calment didn’t die “within a few years”. She lived on and on and on ... until finally expiring in 1997, aged 122. (The longest documented lifespan on record, she put her longevity down to a daily glass of port, a moderate consumption of chocolate and ... “having no money worries”.) On the day after Christmas 1996 – by then she had received around a million francs from Me Affray – she was told that the notaire had died. He had been, it was reported, increasingly irritated by the old lady’s protracted survival.

Becoming more and more popular

The viager system has an obvious appeal to both buyers and sellers. The seller gets guaranteed financial security in old age and the buyer (unless he’s unlucky to end up with record-book material like Jeanne Calment) gets a desirable property at often much less than its market value. The contract is a direct agreement between two private individuals and its application is monitored continuously by a notaire or a lawyer. The seller stays in his or her home and there are strong legal guarantees of regular payment. If a buyer defaults on payment for more than a short period the contract is automatically abrogated and the seller keeps anything paid up to that time ... and becomes once again the unconditional owner of the property. Another advantage for the seller is that only one-third of a viager income is taxable.

Contracts of this kind are becoming more and more popular and are available to those of any nationality. A word of caution, though, that might have been useful to Me Affray before he signed up. For a buyer, men are a better bet than women who live longer than men and sometimes much longer: four out of five of France’s over 20,000 centenarians are female. On the other hand, this age-specific difference in mortality means that a contrat viager is especially attractive to widows who can find themselves in dire straits when their partner dies and may be left with nothing but the conjugal home. The kids, if any, might not be too happy about this, but, well ... tough. I’ve given an outline of how the system works. Anyone interested in setting up such an arrangement should consult an English-speaking notaire such as Me Lallemant in Nice .

From Riviera Reporter Issue 128: Aug/Sept 2008