Public and private content of a development agreement: the municipality can only modify the first

Development agreement: modification of the public part

The public information part can be modified by the Municipalityas regards the subdivision project, with the procedure provided for by the art. 28(1) of Law no. 1150/1942 (so-called Urban Planning Law); the destination or building usability of the area may be changed through the introduction of a new general urban planning instrument (with the sole burden, for the proceeding Administration, of making a reinforced motivation in case of worsening modification for the owners); ceases to have effect after the expiry of the final ten-year term (subject to any extensions).

Development agreement: modification of the private part

The private sector, on the contrary, can only disappear in the presence of mutual dissent (and, therefore, due to the desire for the dissolution of the bond by all the owners at a given time) or other causes for the extinction of the obligation, since the same, pursuant to art. 1372 cc(2), has the force of law between the parties and, given nature propter rem of the obligations that arise from it (i.e., of bonds that follow the property), binds with the same effectiveness subsequent buyers as well of the real estate portions forming part of the sector.

Effects of the modification of the public sector on the private sector

The recent one sentence 13 November 2024, n. 3183, of the TAR Lombardia, Milan, sec. IVdealt with a subdivision agreement in which the participants had voluntarily and for the future assumed the mutual obligation not to allow any change in volume compared to the buildings originally built. Nonetheless, following a new regional regulationsone of the subdividers had requested ed obtained a building permit for the related intervention it had entailed an increase in volume; one of the other developers, however, had invoked the administrative judge because the increase in volume was not compatible with the prohibition in this sense provided for in the original agreement and the intervention had compromised one’s right of view.

The practical problem, brought to the attention of the judges, concerns the possibility that, following new regulations and/or new urban planning assessments, the City Council can modify the content of the public sector and, consequently, also the private sector. If there are no difficulties in admitting that over time the public part of a development agreement can be modified by a council resolution, on the contrary it is not possible to assume that this change will have repercussions on the private content. And in fact, as stated by the Milanese judges, private obligations are not available to the Municipality and, regardless of any changes to the development plan or the general urban planning instrument and also regardless of regulatory contingencies, they continue to be in force for the owners of the individual lots, until the extinction resulting from the operation of the specific institutions provided for by the law (for example, mutual dissent).

This means that, even if the Municipality modifies the manufacturing plan (and therefore the implementation planning) or the urban planning regulation of the area at the general planning level (new PGT), private individuals will remain civilly bound, one towards the other, to the obligations assumed at the time of stipulation (and passed on to the new buyers by virtue of the various deeds of transfer of the property, being propter rem).

The consequences on requests for a building permit

The content of these mandatory rights (in the specific case, of no increase in volume) Furthermore, it is not indifferent to the exercise of the municipal power to issue building permits.

In fact, the Municipality has, pursuant to art. 11(3) of the Consolidated Construction Law (Presidential Decree no. 380/2001), the duty to verify the legitimacy of the applicant to carry out the building transformation requested(4); as part of this verification, the Administration will certainly not be able to preclude consideration of the content of a development agreement signed by the Municipality and of the existence of which the latter is perfectly aware.

Notes

(1) 11. In the municipalities with a construction program and in those with a general master plan, even if the detailed execution plan has not been drawn up, the mayor has the right to invite the owners of the building areas existing in the individual areas to submit within a reasonable time completion of a subdivision project for the areas themselves. If they do not comply, it will be filled in automatically.
12. The approved subdivision project with the modifications that the municipal authority has deemed necessary to make is notified by the municipal messenger to the owners of the building areas with an invitation to declare, within 30 days of notification, whether they accept it. Where such acceptance is lacking, the mayor has the right to vary the subdivision project in accordance with the requests of the interested parties or to proceed with the expropriation of the areas.
(2) The contract has the force of law between the parties. It cannot be dissolved except by mutual consent or for reasons permitted by law.
The contract does not produce effect on third parties except in the cases provided for by law.
(3) 1. The building permit is issued to the owner of the property or to whoever is entitled to request it.
(4) Council of State, sec. IV, sentence. 2 April 2024, n. 2983; TAR Lombardy, Milan, section. II, sentence. 2 April 2024, n. 991; TAR Lazio, Rome, section. II quaterheard. 11 May 2022, n. 5855; see TAR Campania, Naples, section. IV, sentence. November 13, 2020, n. 5204, according to which the power (duty) of the Administration to verify the existence of civil limits for the implementation of the building intervention to be approved remains unchanged; TAR Calabria, Reggio Calabria, sentence. 17 July 2017, n. 681, according to which when issuing the building permit the burden of verifying compliance with the private limits falls on the Administration, provided that they are immediately knowable and effectively and legitimately known, referred to by TAR Calabria, Reggio Calabria, sentence. 14 February 2020, n. 97.