Business Contracts

Since the reform of contract law, voidance for lapse of time (caducité), governed by Articles 1186  and 1187  of the Civil Code, sanctions the disappearance of one of the essential elements of the agreement, subsequent to its formation.
A unilateral promise to sell may be voided in several circumstances.
A unilateral promise of sale becomes null and void if the beneficiary allows the time-limit fo …

Voidance (caducité)

Since the reform of contract law, voidance for lapse of time (caducité), governed by Articles 1186  and 1187  of the Civil Code, sanctions the disappearance of one of the essential elements of the agreement, subsequent to its formation.

A unilateral promise to sell may be voided in several circumstances.

A unilateral promise of sale becomes null and void if the beneficiary allows the time-limit for exercising the option to lapse. For example, a unilateral promise to sell shares where the beneficiary has not exercised the option within the period stipulated in the promise , or has done so belatedly , will lapse. If the unilateral promise of sale has been concluded for an indefinite period without stipulating a specific deadline, the option must have been exercised within a reasonable period of time, “having regard to the intentions expressed by the parties at the time of signing the agreement”, failing which the promise becomes void .

A unilateral promise of sale also becomes void when the deed includes specific provisions concerning the exercise of the option, which have not been met. A unilateral promise of sale which stipulated that the option was to be exercised by signing the deed of sale, with payment of the price and costs by bank check, thus lapsed, whereas the beneficiary only produced a letter of intent, accompanied by conditions, from a banking institution . Conversely, a company, beneficiary of a unilateral promise of sale for the acquisition of two plots of land, is not entitled to invoke its lapse - which sanctions the disappearance of one of the conditions of validity of the contract listed in Article 1128 of the Civil Code - on the grounds that it intended to build a photovoltaic power plant there and that this possibility, an essential element of the contract, would have disappeared in view of the conclusions of an environmental impact study it had carried out, since it only produced a preliminary draft and did not explain how the “possibility of building the power plant” would constitute a condition of validity of the contract, and in particular to what extent the alleged impossibility of carrying out the project would deprive the promise of sale of lawful and certain content .

Where the unilateral promise of sale has been entered into subject to the implementation of a suspensive condition, the breach of the condition renders the promise null and void. For example, a unilateral promise to sell was deemed to have lapsed where the suspensive condition of obtaining one or more loans had not been implemented by the due date, even though it stipulated that, should the beneficiary fail to provide proof of the implementation or default of the condition within eight days of formal notice being given by the promisor, the condition would be deemed to have been breached and the promise deemed to have become void .

On the other hand, neither the death of the promisor  nor his compulsory liquidation  renders the unilateral promise of sale null and void.

Art. 1186 Civil Code: "A validly formed contract becomes void if one of its essential elements disappears.

When the performance of several contracts is necessary to implement the same transaction and one of them disappears, the contracts whose performance is rendered impossible by this disappearance and those for which the performance of the disappeared contract was a determining condition of a party's consent, are null and void.

However, a contract may be declared to have lapsed only if the contracting party against whom it is invoked was aware of the existence of the overall transaction when he gave his consent".

Art. 1187 Civil Code: "Lapse of time terminates the contract.

It may give rise to restitution under the conditions set out in Articles 1352 to 1352-9".

CA Versailles, 10 November 2020, LawLex202300002153JBJ.

Cass. 3e civ, 17 March 2016, LawLex202300005718JBJ.

Cass. com. 27 January 2021, LawLex202300004465JBJ, noting that the unilateral promise to sell lapses when the beneficiary exercises the option more than eleven years and four months after the date of acceptance of the promise.

Cass. 3e civ, 1 July 2015, LawLex202300005701JBJ. See also Cass. 3e civ., 21 October 2014, LawLex202300002516JBJ, noting that the unilateral promise had lapsed on expiry of the contractual term of the promisor's undertaking due to the beneficiary's failure to act, since the latter had not, in accordance with the stipulations of the deed, exercised the option with actual payment of the price on the date on which the time-limit set for signature of the deed expired.

CA Bourges, 20 June 2024, LawLex202400004748JBJ.

Cass. 3e civ, 30 mars 2023, LawLex202300005731JBJ.

Cass. 3e civ, 10 December 1997, LawLex202300002489JBJ.

Cass. com. 7 March 2006, LawLex202200000591JBJ.

Business Contracts

84. Voidance (caducité)

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

84. Voidance (caducité)

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise