Business Contracts

The bilateral promise of sale, which contains the essential elements of the sale, is formed by the conjunction of an offer and an acceptance, by which the promisor and the beneficiary express their intention to enter into a contract . As with any agreement, its validity depends on the consent of the parties, their capacity to contract, and its lawful and certain content .
The consent of the partie …

Substantive conditions

The bilateral promise of sale, which contains the essential elements of the sale, is formed by the conjunction of an offer and an acceptance, by which the promisor and the beneficiary express their intention to enter into a contract . As with any agreement, its validity depends on the consent of the parties, their capacity to contract, and its lawful and certain content .

The consent of the parties to a bilateral promise of sale must be given freely, in an informed manner and must not be vitiated. The parties must therefore respect the pre-contractual information obligation, which is a matter of public policy under Article 1112-1 of the Civil Code , and give consent that is free from mistake, fraud or duress, in accordance with Articles 1130 to 1144.

According to the courts, if a breach of the duty to provide pre-contractual information can only be held against the promisor insofar as the beneficiary of the promise to sell is legitimately unaware of the information - a ventilation problem - of which she claims to have been deprived, this is not the case when, before signing the promise to sell, the beneficiary visited the  basement in question five times, with different people, so that she was able to appreciate the particular nature of the premises and should have been alerted to the level of humidity in the dwelling .

A promise of sale must be annulled on the grounds of a mistake as to the essential qualities, and the clause under which the purchasers undertake to accept servitudes, whether apparent or not, continuous or discontinuous, must be declared unenforceable against them, since they would not have bought the property if they had known that the usable surface area offered for sale was almost ten percent less than that which they intended to acquire, and that they would have to bear a risk of eviction .

The concealment by the vendor of the exact situation of the property sold with regard to the rules governing high-rise buildings and the amount of the security costs involved constitutes fraudulent non-disclosure justifying the invalidity of the bilateral promise of sale, insofar as such elements were decisive for the beneficiary, who should have been in a position to assess the profitability of the real estate transaction and would at the very least have purchased at a lower price if he had known the exact situation . 

The seller of a campsite also commits fraudulent non-disclosure (dol par réticence) if, during the negotiations and the confirmation of the promise to sell, he fails to inform the purchaser, even though he is required to do so, of a letter from the local prefect informing him of a new ministerial order concerning the classification of campsites, following which by failing to present a letter of reclassification by a certain date, the establishment is at risk of being automatically reclassified, and obscures the essential element of the campsite's classification in the deed of sale .

Similarly, a property dealer who refrains from revealing to future buyers that the dormer windows of the building to which the bilateral promise of sale relates had been the subject of a certificate of non-conformity, the extent and legal consequences of which, as a professional seller, he could not have been unaware, is guilty of fraudulent concealment, for the sole purpose of inducing them to enter into a contract . 

The seller also commits fraud, justifying compensation to the purchaser for the loss of a chance to obtain a reduction in the sale price, when the promise to sell stipulates that during the “transfer” period, between the signing of the promise to sell and the signing of the deed of sale, the seller undertakes to periodically inform the purchaser of any change that could significantly affect the property and the buyer, the building and its rental situation, so that the rental situation of the building has been established as a decisive aspect of the parties' consent, if he conceals the financial difficulties of the tenant of the building sold, for which the sum of the rents paid represents approximately half of the rents received . On the other hand, a company specializing in real estate sales is not entitled to seek the invalidity of a preliminary sales agreement for fraudulent concealment on the grounds that several of the dwellings in the building are insalubrious, insofar as it is neither a lay purchaser nor inexperienced and, having visited the dwellings concerned, was able to make all relevant assessments before signing the agreement in full knowledge of the facts .

For the bilateral promise to be validly formed and the sale completed, the consent of the parties must also relate to the subject matter and the price, which must be determined or determinable, insofar as the pre-contract includes the essential elements of the future contract of sale. A bilateral promise is binding if the beneficiary of the promise accepts the offer on the day it is issued, and if the parties agree on the goods and the price . On the other hand, in the absence of agreement on the subject matter and the price, the beneficiary of a bilateral promise of sale is justified in refusing to confirm the sale by deed, since the promise fixes the sale price of the plots concerned by reference to an indication of value, which implies indexation, without however expressly providing for re-evaluation, and the courts cannot substitute themselves for the parties in choosing the methods for updating the price . Pursuant to Article 1583 of the Civil Code , a promise to sell is binding as soon as the parties have agreed on the price and the subject-matter, even if the subject-matter has not yet been delivered or the price paid  and failure to reach a final agreement on the incidental aspects of the sale cannot prevent the sale from being deemed completed . However, as the rule laid down in Article 1583 is only suppletive, the promise may include stipulations making a secondary element a decisive element of the parties' consent .

Entering into a bilateral promise also implies being able to dispose of the property that is the object of the promise. For example, the manager of a non-trading property company (société civile immobilière -SCI) alone cannot sign a bilateral promise of sale for  social housing , if he does not have the power to dispose of the property under the articles of association . Lastly, such property must not be inalienable in order to be sold .

Cass. 3e civ. 11 June 1992, LawLex202100006120JBJ.

Cass. 3e civ. 4 October 1989, LawLex202300004501JBJ.

Art. 1583 Civil Code: “[the sale] is complete between the parties, and ownership is automatically acquired by the buyer from the seller, as soon as the thing and the price have been agreed, even if the thing has not yet been delivered or the price paid”.

Cass. 3e civ, 18 February 2009, LawLex202100006408JBJ.

Cass. 3e civ, 14 January 1987, LawLex202300003149JBJ.

For an application, see Cass. 3e civ. 16 September 2021, LawLex202300004721JBJ, above.

Cass. 3e civ. 5 November 2020, LawLex202200003580JBJ.

Cass. 3e civ, 30 January 2020, LawLex202100006415JBJ, having considered valid the bilateral promise of sale, which, relating to a property subject to an inalienability clause, could not be confirmed by an authentic deed for which no time-limit was provided and which the parties did not intend to terminate, since, as a result of a death, the legal obstacle to regularization by notarial deed, relating to the inalienability of the property, had ceased to exist on the day when, in disregard of the agreed sale and in fraud of the purchaser's rights, the promisor made a subsequent donation of said property.

Art. 1112-1 Civil Code: "A party who is aware of information the importance of which is decisive for the consent of the other party must inform that other party if the latter is legitimately unaware of the information or has confidence in the other party.

However, this obligation to inform does not apply to the estimation of the value of the service.

Information which has a direct and necessary link with the content of the contract or the capacity of the parties is of decisive importance.

The onus is on the party claiming to be owed information to prove that the other party owed it to him, and on the other party to prove that he provided it.

The parties may neither limit nor waive this obligation.

In addition to the liability of the party who was bound by it, failure to comply with this obligation to provide information may result in the annulment of the agreement under the conditions set out in Articles 1130 et seq.".

CA Riom, 19 October 2021, LawLex202100006138JBJ.

Cass. 3e civ, 15 February 2006, LawLex202300005126JBJ.

Cass. 3e civ, 22 June 2005, LawLex200600002189JBJ.

Cass. 1re civ, 16 October 2001, LawLex200700000786JBJ.

Cass. 3e civ, 16 September 2021, LawLex202300004721JBJ.

Cass. 3e civ, 7 May 2014, LawLex201400001122JBJ.

Business Contracts

91. Substantive conditions

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91. Substantive conditions

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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