Business Contracts

Article 1124, paragraph 1 of the Civil Code defines a unilateral promise as “an agreement by which one party, the promisor, grants to the other, the beneficiary, the right to opt for the conclusion of a contract, the essential elements of which are determined, and for the formation of which only the consent of the beneficiary is lacking”.
According to the Court of Cassation, a unilateral promise t …

Unilateral promise to purchase

Article 1124, paragraph 1 of the Civil Code defines a unilateral promise as “an agreement by which one party, the promisor, grants to the other, the beneficiary, the right to opt for the conclusion of a contract, the essential elements of which are determined, and for the formation of which only the consent of the beneficiary is lacking”.

According to the Court of Cassation, a unilateral promise to purchase is an agreement by which the promisor undertakes to acquire movable or immovable property belonging to the beneficiary if the latter agrees [or not] to sell it to that person  by exercising the option.

The mechanism of unilateral promises of sale and unilateral promises of purchase are closely related and, with a few rare exceptions, are subject to the same conditions regarding their formation. As in the case of a unilateral promise to sell: classification as a unilateral promise to purchase is incompatible with full acceptance of the proposed agreement by both parties; the consent of the beneficiary is the only element required for a contract of sale to be formed; a unilateral promise to purchase must specify the essential aspects of the future contract of sale, i.e. the subject matter and the price; the formation of a unilateral promise to purchase presupposes the free, informed and non-vitiated consent of the parties. On the other hand, the unilateral promise to purchase is not subject to the registration formality provided for under Article 1589-2 , which applies only to unilateral promises to sell .

However, the “reverse mirror effect” of unilateral promises of sale and unilateral promises of purchase also helps to distinguish them from one another. Whereas in a unilateral promise of sale, the promisor makes a definitive binding commitment to sell, and must have the capacity and power to dispose of the property on the day the promise is made, in a unilateral promise of purchase, it is the beneficiary who must be able to dispose of the property on the day consent is given for the sale. The Court of Cassation has reiterated this principle, stating that the capacity of the beneficiary of a unilateral promise to purchase to enter into the definitive agreement must be assessed on the day on which the option is exercised . In its capacity as a professional in the sale of real estate, SAFER, as the beneficiary of a unilateral promise of sale for a property, must therefore inquire about the availability of the property before agreeing to the sale .

Beyond its formation, the unilateral promise of purchase follows a legal regime relatively similar to that of the unilateral promise of sale.

Under a unilateral promise of purchase, the promisor makes a definitive commitment to purchase to the beneficiary, who, acknowledging this commitment, does not undertake to enter into a definitive agreement, but has an option to decide whether or not to consent to the sale in the future. A unilateral promise of purchase which has not been implemented by the date specified in the deed by sending the promisor a registered letter with acknowledgement of receipt  has therefore lapsed.

The promisor's commitment to purchase from the beneficiary is irrevocable. Consequently, if a promisor, who, even though the unilateral promise of purchase of shares has been accepted by the beneficiaries without reservation in the prescribed form and time-limit, and the suspensive conditions have been lifted, fails to appear at the signing of the deed of sale, he/she will be ordered to forcibly implement the sale, even if the forfaitary indemnity has been paid in the event that the termination is not implemented as a result of his/her failure to do so . On the other hand, a promisor who has undertaken, in a unilateral promise of purchase, to acquire a property belonging to a non-trading real estate undertaking (société civile immobilière), subject to the dual suspensive condition of obtaining a license to operate a licensed drinking establishment, as well as a loan, is entitled to the return of the security deposit where the beneficiary has not exercised the option . 

By exercising the option, the beneficiary also definitively consents to the sale. The promisor may then request performance in kind or rescission . In addition, the beneficiary of a unilateral promise of purchase who, despite exercising the option and paying the sale price, refuses to confirm the sale by notarial deed on the pretext of an unestablished discrepancy between the wording and the terms of the promise, may be liable for damages towards the promisor .

Cass. 3e civ. 16 March 2023, LawLex202300004590JBJ.

Art. 1589-2 Civil Code: “Any unilateral promise of sale relating to an building, a real estate right, a business, a right to a lease relating to all or part of a building, or to the shares of the companies referred to in Articles 728 and 1655 ter of the General Tax Code, is null and void if it is not recorded in a notarial deed or in a private deed registered within ten days of the date of its acceptance by the beneficiary”.

Cass. 3e civ., 18 March 1975, LawLex202300003354JBJ.

Cass. 3e civ, 10 September 2020, LawLex202300004595JBJ.

Cass. 3e civ, 29 March 2006, LawLex202300003493JBJ.

Cass. 1re civ. 29 June 2016, LawLex202300004604JBJ, holding that a clause contained in a unilateral promise of purchase and drafted in clear, precise and unequivocal terms, the purpose of which is, after exercise of the option by the beneficiaries, to evaluate in advance the indemnity due by the promisor, in the event of non-performance of the obligation to sign the deed recording the binding nature of the transfer of the shares, does not preclude compulsory enforcement of the agreement. Upholding CA Paris, 21 May, 2015, LawLex202300004628JBJ, which held that the stipulation within a unilateral promise of purchase, of a penalty clause in the event of non-performance of the agreement could not allow the promisor, in the event of non-performance of the agreement, to require specific  performance of the promise.

Cass. 3e civ. 13 May 1998, LawLex202200000971JBJ.

Art. 1217 Civil Code: "A party to whom a commitment has not been performed, or has been performed only partially, may :

- refuse to perform or suspend performance of his own obligation ;

- pursue specific performance of the obligation;

- claim compensation for the consequences of non-performance.

Sanctions which are not incompatible may be combined; damages may always be included".

Cass. 3e civ. 6 November 2013, LawLex202300004596JBJ, having further granted the promisor/buyer's request for rescission. See Cass. 3e civ., 29 March 2006, LawLex202300003493JBJ, qushing the appellate court's decision rejecting the promisor's claim for damages against the SAFER (Real Estate and Rural Planning Agency) beneficiary of the unilateral promise of purchase, even though the latter, in its capacity as a professional in the sale of real estate, should have enquired about the availability of the property before exercising the option.

Business Contracts

88. Unilateral promise to purchase

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Les notions juridiques connexes

88. Unilateral promise to purchase

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise