Business Contracts

Insofar as the existence of an agency agreement has, in principle, already been proven, proof of its scope is entirely unrestricted. Thus, in the absence of a written document, proof of the scope of the agency agreement entrusted by a client to his lawyer may be sought by reference to the work performed, correspondence exchanged and the wording of fee invoices . 

In effect, the Court of Cassation, in a ruling dated 29 November 1972, held that it is up to the trial courts to make their own assessment of the scope of an agency agreement  which, by virtue of Article 1987, may be general, covering all the affairs of the principal, or specific, covering one or more matters only. However, an agency agreement must be interpreted strictly when the court assesses its content . 

The courts' approach is based on Article 1989 of the Civil Code, which stipulates that the agent may do nothing beyond the scope of the mandate, the power to compromise not being the same as the power to compromise, and on Article 1988, which provides that the general mandate covers only acts relating to matters of administration  and that in the case of disposal, mortgage or any other deed relating to property , the power of attorney must be express. As a result, according to case law, this principle of strict interpretation of the content of the agency agreement justifies the fact that the tacit agency agreement is generally limited to acts of administration, a special and express agency agreement being required for acts of disposal that bind the agent . Thus, the fact that a notary has validly discussed and exchanged views with a colleague in the interests of his client, in an attempt to draw up a global and definitive liquidation plan for his property interests with his ex-wife, does not characterize the existence of an agreement to make compromises in his name and on his behalf, since the notary's agency agreement is only ancillary and does not derogate from the principle of the requirement of a special agency agreement to conclude an arrangement . Nor does the act of mandating a notary to draw up a definitive project for the sale of an immovable and to establish the formalities for that sale constitute an express agency agreement to sell . Similarly, the fact that the seller has granted a real estate agent an agency agreement to sell his property at a certain price does not give the agent the power to represent him in accepting offers to purchase on his behalf, nor to sell the property on his behalf , since the agency agreement, even if exclusive, granted to an estate agent confers  only a mission of intermediation which does not have the effect of substituting him for his principal for the implementation of the proposed sale, unless a special term expressly authorizes him to do so, for a transaction specified in the terms of Article 72, paragraph 3, of the Decree of July 20, 1972 . On the other hand, a power of attorney which, in addition to the general authority to manage and administer all the principal's property, instructs the agent to sell the principal's property and to agree to such sales at such prices, charges and conditions as the agent may advise, constitutes an express agency agreement to sell .

In some cases, evidence of the scope of the agency agreement is presumed. Thus, according to the Court of Cassation, a reinsurer is presumed to have been invested with a general agency agreement, in the absence of any challenge by co-insurers .

CA Bordeaux, 25 April 2023, LawLex202300007606JBJ.

Cass. 3e civ, 29 November 1972, LawLex202300007498JBJ, specifying that a notary's agency agreement to receive the arrears of an annuity does not give him the power to waive, on behalf of the creditor, the benefit of the resolutory clause, so that the principal who informed him that she did not accept the offers of late payment is justified in her action for rescission.

Cass. 1re civ, 6 July 2000, LawLex202200008800JBJ.

Cass. com., 21 November 2018, LawLex202200008893JBJ; Cass. 2e civ., 8 June 2017, LawLex202200008892JBJ.

CA Montpellier, 21 October 2022, LawLex202300007605JBJ.

Cass. 1re civ, 17 May 1993, LawLex202100002627JBJ: a commercial lease is an act of disposal, not an act of management, so that the husband cannot validly perform it on his wife's own property, unless he can prove that she has given him an express agency agreement to perform such an act.

CA Saint-Denis de la Réunion, 7 June 2024, LawLex202400008078JBJ.

Cass. 3e civ., 17 July1991, LawLex202300012148JBJ,

CA Paris, 11 October 2024, LawLex202400007839JBJ.

CA Poitiers, 3 October 2023, LawLex202400002259JBJ; in an earlier case, see Cass. 1re civ., 21 December 1976, LawLex202200010998JBJ; 12 July 2006, LawLex202300007385JBJ.

477. Scope of the agreement