Written commercial agreement

Significant imbalance

Sudden termination of established relationships

Competition investigation – French law

Civil competition action

French competition law

Competition investigation – European law

European competition law

Vertical restraints

Distribution law

Liability for defective products

Consumer law

Prohibition of measures having equivalent effect

European business law

Corruption

Compliance

Economic law

Shareholders' agreements

Removal of company directors

Abuse of voting rights

Companies

Action for infringement (counterfeiting)

Rights conferred by the trademark

Patentability

Industrial property

Commercial rent review

Renewal of the commercial lease

Despecialization (change of use)

Commercial leases

Reform of contract law

Reform of the law of special contracts

Preliminary sales agreement

Obligation to deliver goods in conformity

Classification of the contract for services (contrat d'entreprise)

Effects of the agency agreement with respect to third parties

Business contracts

Ongoing contracts

Recovery claims

Court-approved transfer plan

Bankruptcy proceedings

Personal data breaches

White collar crime

Commercial law

500 Questions - Business Law

The delivery of an item not in conformity with the contractual specifications must be distinguished from the scenario where the item sold is affected by a latent  defect, meaning when the delivered object does correspond to the contractual specifications but has a non-apparent defect that prevents its use or diminishes it so significantly that the buyer, had they been aware of it, would not have p …

How does a latent defect differ from non-conformity?

Pursuant to Article 1603 of the Civil Code, the seller has two main obligations: to deliver (in the sense 'handover') and to guarantee the item sold. Case law has developed the theory of the obligation of conforming delivery based on the concept of delivery, defined in Article 1604, as “the transfer of the item sold into the power and possession of the buyer.”

The concept of conforming delivery is dual because it requires the seller to deliver the item sold and for this item to conform to the agreed item. This duality is reflected in the burden of proof, with the proof of performance of the delivery obligation resting on the seller , while the proof of non-conformity between the delivered item and the agreed item rests on the buyer .

Despite the legal definition of delivery as set out in Article 1604, delivery does not necessarily imply transport, so delivery and handover are not synonymous. In practice, the obligation of handover rests on the seller only insofar as the buyer is not required to collect the item sold, as is the case, for example, in real estate matters.

The delivery is also not synonymous with the transfer of ownership because, in contracts whose purpose is the alienation of ownership or the assignment of another right, the transfer of ownership of the item sold - including the transfer of risks - occurs, except for exceptions, solo consensu, that is, by the mere exchange of wills, independently of the delivery, which constitutes only the material act of making it available.

Conformity implies that the delivered item corresponds to the stipulations of the sales contract .

However, the concept of conformity today more broadly refers to the general obligation of conformity provided by Article L. 411-12 of the Consumer Code, which is binding on any party responsible for the first placing on the market of a product and involves assessing the compatibility of goods with the standards and regulations in force, as well as with the legal and commercial guarantees of conformity provided by the same code, applicable to the consumer or non-professional who has contracted with a professional.

Since it is up to the party demanding the performance of an obligation to prove it, it is the seller who claims payment of the full price and to whom the buyer enforces having received only part of the order, who must prove that the rest of the goods were delivered.

Cass. com., 23 October 1990, LawLex200500008714JBJ.

The non-conformity of the item is not demonstrated when the only delivery notes provided by the purchaser do not mention the alleged non-conformity regarding the agreed characteristics of the item.

Cass. com., 8 November 2011, LawLex201300000689JBJ.

Non-conformity consists of a difference between the item promised in the contract and the item delivered.

CA Toulouse, 13 May 2009, LawLex201300000772JBJ.

What does the obligation of conformity entail?

Delivery is governed by Articles 1604 to 1624 of the Civil Code. According to the first of these texts, “delivery is the transfer of the sold item into the power and possession of the buyer.” However, since delivery does not necessarily imply the transport of the sold item, case law considers that it consists, for the seller, of making the sold item available to the buyer so that they can take possession of it .

The terms of this provision vary according to the nature of the item sold.

For real estate, Article 1605 of the Civil Code states that “the obligation to deliver real estate is fulfilled by the seller when he has handed over the keys, if it is a building, or when he has handed over the title deeds.” However, this text only obliges the seller or his representative to hand over the keys of the property to the buyer if he himself has them .

Furthermore, according to case law, the obligation to deliver a building is fulfilled only if it is free of occupation. To satisfy this, the seller of the building must either vacate and evacuate it if they occupy it themselves, or have it vacated and evacuated at their expense if it is occupied by a third party who does not have a right enforceable against the buyer .

For movable property, the Civil Code distinguishes between tangible and intangible goods.

Regarding tangible movable property, according to Article 1606, the provision of movable effects is carried out:

either by delivering the item into the hands of the buyer or their representative  or to those of the carrier in the case of a distance sale ;

either by handing over the keys to the buildings that contain them;

either “by the sole consent of the parties, if the transport cannot be carried out at the time of the sale, or if the buyer already had them in his possession under another title” .

Regarding intangible property, Article 1607 provides that the transfer of intangible rights is carried out either by the delivery of the titles , or by the use made by the purchaser with the consent of the seller.

Unless otherwise stipulated, the costs of delivery are in principle borne by the seller and those of removal by the buyer pursuant to Article 1608.

The burden of proof for the performance of the obligation to deliver rests on the seller. The seller must also provide proof of the delivery of the ancillary items of the thing sold .

Regarding the place of delivery, according to Article 1609, it corresponds:

for specific goods, at the place where the item was at the time of sale, unless otherwise stipulated;

for fungible things sold by weight or measure, their provision takes place where they become specific goods, that is, at the place of their individualization, in accordance with the provisions of Article 1585.

Regarding the date of delivery, it occurs, pursuant to Article 1610, at the time agreed upon by the parties . The burden of proof that delivery occurred within the allotted time lies with the seller . In the absence of a stipulated time, it is up to the trial court to set a reasonable time .

If the seller does not deliver within the stipulated time, the buyer may, under Article 1610, request, at their choice, the rescission of the sale or possession, if the delay is solely attributable to the seller . In all cases, according to Article 1611, the seller must be ordered to pay damages to the buyer if harm results from the failure to deliver by the agreed deadline.

The sale cannot be automatically rescinded due to the buyer's failure to fulfill their obligation to collect within the agreed timeframe without determining whether the seller made the sold goods available before the expiration of this term.

Cass. 1re civ., 24 October 2000, LawLex202200000343JBJ.

Article 1605 of the Civil Code only obliges the seller or their representative to hand over the keys if they themselves have them.

Cass. 1re civ., 16 June 1982, LawLex202300008959JBJ.

In the absence of an agreed deadline, it is up to the trial court to determine the reasonable time within which the sellers were required to deliver the item sold.

Cass. 3e civ., 10 April 1973, LawLex202200000201JBJ.

The buyer, who, after ordering a truck from a manufacturer with only an approximate delivery date, notifies the seller three months after this deadline that he considers the sale “rescinded” and refuses to take delivery of the subsequently delivered vehicle, must have the sale rescinded at his fault since he unilaterally and without resorting to the courts terminated the contract due to the delay by his contracting party in fulfilling its obligation.

Cass. com., 24 June 1980, LawLex202300003755JBJ.

Since the specifications did not contain any specific clause limiting or modifying the scope of the obligation to deliver that any sale, even forced, imposes on the seller of real estate, who must vacate and clear it if they occupy it themselves, or have it vacated and cleared at their expense if it is occupied by a third party, fails in this obligation, even without formal notice, the bankruptcy trustee who, maintaining a purely passive attitude, did not have the business premises vacated by the bankrupt merchant who occupied it.

Cass. 1re civ., 24 April 1967, LawLex202300008977JBJ.

The buyer is not entitled to invoke a breach by the seller of their obligation to deliver when their agent came to inspect the goods at the seller's premises and then handed them over to the carrier for shipment by air.

Cass. com., 17 February 1998, LawLex202200008818JBJ.

The seller who hands over the goods to the carrier, who accepts them without reservation, fulfills their obligation of delivery.

Cass. com., 8 October 1996, LawLex200500008709JBJ.

The obligation to deliver the transferred shares is fulfilled by signing the transfer orders, which is the sole responsibility of the transferor.

Cass. com., 24 May 2011, LawLex202200011403JBJ.

In the transfer of a claim, a right, or an action against a third party, delivery is effected between the assignor and the assignee by handing over the title.

Cass. 3e civ., 13 July 1999, LawLex202100006427JBJ.

It is the responsibility of the seller of a road tractor, and not the buyer who is seeking the rescission of the sale, to provide proof that the maintenance logbook and the report from the Mines Service were delivered to the latter at the time of sale.

Cass. com., 11 December 2001, LawLex200500008711JBJ.

The clause that gives the delivery period an indicative nature and exempts the seller from paying damages in the event of a breach of their essential obligation to deliver within the agreed time is unfair.

Cass. 1re civ., 16 July 1987, LawLex200300001210JBJ.

The seller, bound by the obligation to deliver the sold vehicle, must prove that they made it available to the buyer within the agreed timeframe.

Cass. 1re civ., 19 March 1996, LawLex200500008713JBJ.

What are the methods of delivery?

According to Article 1614, the item must be delivered in the condition it is in at the time of sale, with the fruits belonging to the buyer from that day. It follows from this text that the seller, as the custodian of the item, is required to preserve it and take care of it as a prudent person would, until its actual delivery .

However, there are two cases in which the seller is not obliged to deliver:

Article 1612 states that the seller is not required to deliver the item as long as the buyer does not pay the price and the seller has not granted them a payment deadline. It follows from this text that the seller can withhold the item until they have been paid by raising the defense of non-performance.

Furthermore, under Article 1613, the seller is not obliged to deliver the item, even if a payment deadline has been granted, in the event that, since the sale, the buyer has gone bankrupt or become insolvent, placing the seller in imminent danger of losing the price, unless the buyer provides a guarantee of payment at the due date.

Advice: Attempt to reverse the burden of proof by arguing that it is up to the buyer to provide evidence of the partial delivery of the equipment they ordered.

The seller, obliged to deliver the item sold, is thereby responsible for ensuring its preservation until the agreed date for its actual delivery, regardless of whether this date has not yet passed or the ownership of the item has previously been transferred to the buyer.

Cass. com., 12 May 2004, LawLex202300009005JBJ.

Who bears the obligation of delivery?

Non-conformity refers to a difference from the agreed characteristics, even if the goods sold are likely to satisfy the buyer . The obligation of conformity in delivery therefore implies an exact match between the item delivered and what was agreed upon between the buyer and the seller .

According to case law, agreed characteristics should be understood to mean not only the contractual stipulations (sales contract, order form, or general terms and conditions of sale) but also all documents , plans , or materials in consideration of which the sale was concluded, thus entering the contractual sphere . The item delivered must not only conform to the contract but also to the standards in force related to the nature of the good and the circumstances of the sale . When the item sold is governed by legal or regulatory standards, compliance with these provisions falls within the contractual scope, even if the contract does not mention them . The commercial practices in force also fall within the contractual sphere .

The agreed characteristics are, according to case law, the technical characteristics of the object sold: the weight of a vehicle ; the aesthetic characteristics in consideration of which a sale is concluded ...

According to Article 1602 of the Civil Code, the seller must clearly explain what they are committing to, as any obscure or ambiguous agreement is interpreted against them . In the event of a dispute, it is up to the trial court to determine whether the equipment delivered by the seller meets the specifications outlined in the parties' agreement.

However, the buyer must specify the conditions of use of the goods : for example, a professional buyer who claims that the percentage of additives in the organic floral water they ordered is essential to them, but who specifies nothing at the time of ordering and does not verify the composition of the requested samples upon receipt, does not demonstrate a breach by the seller of their obligation to deliver in conformity.

Advice: Point out that the buyer did not specify any requirements at the time of ordering, so that any non-conformity cannot be attributed to the seller.

The delivery of a product of good quality, but which does not meet the specifications contractually agreed upon between the parties, constitutes a breach of the obligation of conforming delivery.

CA Amiens, 29 May 1990, LawLex200500010229JBJ.

Just as the seller is required to deliver an item whose characteristics correspond to the order, the buyer cannot be required to accept an item different from that initially provided for in the contract.

Cass. 1re civ., 1 December 1987, LawLex200500008715JBJ.

An agreement must be interpreted in favor of the buyer when the seller of a vehicle has not clearly indicated the characteristics, model, and price of the vehicle they committed to deliver.

Cass. 1re civ., 13 April 1999, LawLex200500008750JBJ.

The provision of presentation boxes for chocolates affected by a persistent odor, even though the order was for an odorless product, is sufficient to establish the seller's violation of their obligation to deliver goods in conformity, justifying the rescission of the sale.

CA Versailles, 11 September 2018, LawLex201800001313JBJ.

The invoice by the seller containing the statement “non-accident vehicle” also brings this quality into the contractual scope of the parties.

CA Bordeaux, 19 February 2013, LawLex201300000781JBJ.

The seller who delivers to the buyer an apartment located on the fourth floor, facing a five-story building situated directly opposite the apartment, whereas the buyer ordered from plans an apartment located on the fourth floor with a view of a three-story building offset to the left in relation to the windows, has failed in their obligation of conforming delivery.

Cass. 3e civ., 10 March 2015, LawLex201600000102JBJ.

The documentation accompanying the vehicle and the indications on the fuel tank flap constitute documents and indications falling within the contractual scope of the parties.

CA Reims, 29 August 2005, LawLex200600001712JBJ.

Unless otherwise stipulated, the lack of conformity must be assessed with regard to the technical data known or foreseeable on the day of the sale and cannot result from the inadequacy of the item sold to standards subsequently developed and arising from technological advancements.

Cass. 1re civ., 7 May 2008, LawLex200800001011JBJ.

The seller who delivers an item that does not comply with the regulations fails in their obligation of conforming delivery.

Cass. com., 9 December 2020, LawLex202100000065JBJ.

The seller, who had committed, according to a practice established between the parties in business relations for several years, to deliver seeds always treated, failed in their obligation to deliver in conformity with the usual contractual stipulations by delivering untreated seeds, sold at the price of treated seeds.

Cass. com., 30 March 1999, LawLex202200002758JBJ.

The seller who delivers a semi-trailer with an excess weight of 2,740 kilograms, thereby limiting its payload, fails to meet their obligation of conforming delivery.

CA Paris, 3 March 2016, LawLex201600000540JBJ.

To assess the scope of the seller's obligation to deliver, consideration must be given to the characteristics for which the sale was concluded, particularly aesthetic ones, as the aesthetic dimension is important in the purchase and installation of a fitted kitchen.

CA Pau, 28 March 2017, LawLex201700000687JBJ.

What is meant by agreed characteristics?

Under Article 1604 of the Civil Code, the seller must deliver an item that conforms to what was agreed upon between the parties.

This is an obligation of result, the contours of which have been defined by case law that has developed a strict compliance requirement: the item delivered by the seller must be strictly in conformity, in its nature, quality, and quantity, with what was agreed between the parties .

For the Court of Cassation, the extent of the obligation to deliver is assessed considering the characteristics based on which the sale of the item was concluded . However, the nature of the item also determines the scope of the obligation to deliver in conformity. Thus, the sale of a new item implies an item without defects . For complex items  or those of high technicality , the Court of Cassation considers that the obligation to deliver in conformity is not limited to the delivery of the material elements actually ordered: the obligation is fully executed only once the effective adjustment of the sold item is achieved, with the seller being required to ensure at their expense the necessary adjustments for the complete execution of their obligation.

To be compliant, the delivery must not only be identical but also complete in relation to the order. A seller must thus deliver all the elements comprising the ordered item . The same applies in the case of delivering an item partially conforming to the agreed characteristics . The obligation of compliant delivery also implies that the seller is prohibited from modifying the ordered item on their own initiative, as long as it no longer corresponds to what was agreed with the buyer . In general, compliance is assessed on a case-by-case basis .

Article 1615 of the Civil Code states that “the obligation to deliver the item includes its accessories and everything intended for its perpetual use.” The obligation of conforming delivery incumbent on the seller therefore applies not only to the item agreed upon by the parties but also to its accessories, which must be delivered at the same time as the item or very shortly thereafter.

The courts adopt a very broad concept of the notion of ancillary . Initially limited to material elements necessary for the use of the item, such as a vehicle's spare tire or the user, operating, and maintenance manuals of the item, the notion of ancillary has been extended to all administrative documents necessary for the normal use of the item .

Furthermore, the concept of ancillary includes the legal rights attached to the item, and notably, in the case of successive sales, the legal actions attached to the item that belong to its author .

Conformity refers to the content, contractually agreed upon, of the identity and quality of the item as it is at the time of sale, and not its value.

CA Orléans, 10 October 2019, LawLex201900001252JBJ.

The professional seller who delivered a product that did not conform to the order, regarding its brand and thickness, violated their obligation of conforming delivery.

CA Pau, 12 January 2018, LawLex201800000092JBJ.

To comply with its obligation of conforming delivery, the seller of a vehicle must provide the buyer with all administrative documents related to the car being sold, and in particular, the registration certificate, as this document is necessary for driving.

CA Douai, 4 March 2013, LawLex201300000512JBJ.

The sub-purchaser of a good has a direct contractual action against the original seller based on the potential non-conformity of the delivered item.

Cass. 1re civ., 22 February 2000, LawLex202200000170JBJ.

Defects in operation and aesthetics discovered on a vehicle presented as new for sale justify the exercise of a legal action for non-compliance with the contractual stipulations of the order.

Cass. 1re civ., 3 July 2008, LawLex201300000736JBJ.

The obligation to deliver complex products is fully performed only once the effective development of the item sold is completed, which is not the case when the delivered website does not function.

Cass. com., 26 November 2013, LawLex201400000540JBJ.

Regarding the scope of the obligation of conforming delivery of a combined solar station, the courts consider that it is not limited to the supply of solar panels and the equipment specified in the purchase order, but also includes achieving the expected performance in terms of energy savings.

CA Aix-en-Provence, 16 February 2017, LawLex201700000392JBJ.

The omission of an inseparable element of the item ordered is sufficient to constitute a breach of the obligation of conforming delivery.

Cass. 1re civ., 19 November 1996, LawLex200500008706JBJ.

The seller who has committed to providing a buyer with apple seedlings of a certain quality, and who only partially fulfills this commitment, breaches their obligation of conforming delivery.

Cass. 1re civ., 24 November 1993, LawLex200300001216JBJ.

The seller does not fulfill their contractual obligation to deliver wine that is compliant, fair, and merchantable when, on their own initiative, they proceed with its chaptalization, and it subsequently turns out that this wine must be withdrawn from the market.

CA Montpellier, 15 April 1993, LawLex200500010204JBJ.

The seller of a product that proved unsuitable for its contractually defined use as an exterior coating fails in their obligation of conforming delivery.

Cass. 1re civ., 17 June 1997, LawLex200500008753JBJ.

The seller of a vehicle must provide the buyer with the technical inspection certificate dated less than 6 months prior, as this document is necessary for the vehicle's registration in the buyer's name and thus constitutes an ancillary item within the meaning of Article 1614 of the Civil Code.

CA Douai, 10 October 2011, LawLex201300000518JBJ.

What does the conformity of the item and its accessories cover?

The delivery of an item not in conformity with the contractual specifications must be distinguished from the scenario where the item sold is affected by a latent  defect, meaning when the delivered object does correspond to the contractual specifications but has a non-apparent defect that prevents its use or diminishes it so significantly that the buyer, had they been aware of it, would not have purchased it or would have done so at a lower price.

For a time, the Court of Cassation made an extensive interpretation of the non-conformity of goods, considering that the seller is obliged to deliver an item that conforms to its intended use , thus allowing the purchaser of a defective item an option between the action for warranty against hidden defects, subject to the time limit of Article 1648, and the one based on the breach of the obligation to deliver a conforming item, subject to the ordinary law prescription.

Then, the Court of Cassation reversed its case law by stating that when defects render the item unfit for its normal use, the warranty against hidden defects constitutes the sole possible basis for the action .

Jurisprudence has also been inconsistent regarding the role of the judge in cases of legally unfounded claims. However, a ruling by the Plenary Assembly of the Court of Cassation dated 21 December 2007 clarified the situation: the judge may change the designation or legal basis of the parties' claims, although they are not obliged to do so.

Non-conformity and hidden defect are now clearly differentiated: all the seller's formal promises that prove unsatisfactory in view of the characteristics of the vehicle ordered constitute non-performance of the delivery obligation, while all reductions in usability or serious malfunctions fall under the regime of hidden defects . According to the Court of Cassation, the malfunctions of a new item constitute a hidden defect.

Advice: Argue that the lack of conformity constitutes a latent defect, with the result that the buyer’s action, which must therefore be brought within two years from the discovery of the defect, is time-barred.

Non-conformity of goods refers to goods that are correct but do not comply with the stipulations of the contract, as well as those affected by an anomaly that makes them unsuitable for their intended use.

Cass. 1re civ., 6 June 1990, LawLex200500008722JBJ.

Non-conformity refers to goods that are correct but not in accordance with the contract stipulations, as well as those affected by an anomaly that makes them unsuitable for their intended use.

Cass. 1re civ., 13 June 2006, LawLex200600002182JBJ.

If the non-buildability of a plot of land that was exchanged, resold, and then leased is attributable to the original seller's failure to fulfill their obligation to deliver a thing conforming to what was promised in the exchange deed, it constitutes, however, for the intermediate seller, a hidden defect for which they are required to provide a guarantee.

Cass. 3e civ., 30 September 2021, LawLex202100005513JBJ.

The obligation to deliver in accordance with the terms of the contract, as set forth in Articles 1604 and 1615 of the Civil Code, includes a third component: the obligation to provide information, details, and advice, which falls on the seller when delivering the item. Developed by case law by combining these texts with Article 1602, para. 1, which states that the seller clearly explains what they are committing to, this obligation of information, generally considered as ancillary to the item, is only incumbent upon professional sellers .

First, prior to the conclusion of the contract, the professional seller is bound by a duty to advise the inexperienced buyer, which requires them to precisely inquire about the buyer's needs and the suitability of the proposed equipment for its intended use. The duty to inform not only concerns the technical constraints of the item sold but also the various applicable administrative requirements, the non-compliance with which would prevent it from achieving the intended purpose. If necessary, the seller is then obliged to warn the buyer of the non-conformity of the item to its intended use .

Then, during the performance of the contract, the seller has the obligation to inform the buyer in a precise, clear, and fair manner about all useful or essential indications for the use of the item sold . The Court of Cassation, however, considers that the seller is only bound by a “legal” duty to inform the buyer within the limits of their technical expertise .

The professional seller is bound by this obligation of information, instruction, and advice primarily towards the non-expert buyer. With respect to professional buyers, the professional seller is subject to this obligation only to the extent that the buyer acts outside their area of technical expertise.

Finally, Article 1602, para. 2, states that “any obscure or ambiguous agreement is interpreted against the seller” . It follows that the seller who does not provide the technical sheets of the purchased furniture makes the sales contract obscure or ambiguous, so that the buyer is justified in refusing the delivery of an aesthetically defective product that does not correspond to what was ordered.

Advice: Assert that the buyer, as a professional purchaser, is capable of assessing the exact scope of the technical characteristics of the item sold and therefore cannot claim any lack of conformity..

When the seller and the buyer are both non-professionals, the seller is not bound by a specific duty to inform the buyer, as both are on an equal footing.

CA Riom, 5 January 2012, LawLex201300000616JBJ.

The seller of an air conditioning system is thus required to inform purchasers of the noise disturbances caused by this type of equipment when it turns out that the system is to be installed in the bedrooms of their residence.

CA Angers, 4 December 2012, LawLex201300000614JBJ.

When the use of the item requires administrative authorization, the obligation to inform is reinforced.

CA Amiens, 11 October 2012, LawLex201300000662JBJ.

A seller of a video surveillance system does not breach its duty to inform when it does not draw the purchasing undertaking's attention to the incompatibility of its installation with the provisions of the Labor Code.

Cass. 1re civ., 25 June 2002, LawLex200500005849JBJ.

An agreement will be interpreted in favor of the buyers when the seller has not clearly indicated to them the characteristics, model, and price of the vehicle they are committed to delivering.

What does the disclosure requirement associated with the obligation to deliver compliant goods entail? entail?

When the buyer finds that the delivered product does not conform to the contractual specifications, they must report this non-conformity to the seller, so that the seller can take the necessary measures to remedy the observed defect.

500 Questions - Business Law

437. How does a latent defect differ from non-conformity?

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437. How does a latent defect differ from non-conformity?

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