French Property News – August 2019

http://www.completefrance.com August 2019 French Property News 79

ACCEPT DEFEAT?

Being gazumped on a property purchase is never nice, but it’s

even worse when you believe you already have a contract in

place. David Anderson explains where the law stands on the

issue and what you can do

G

azumping is rare in France
but there are circumstances
in which it can happen.
Consider the following scenario
and how it could be resolved.
Mr X viewed a flat in Paris and
made a formal written offer in
July, which was accepted through
the estate agent. At the request of
the seller, the offer stipulated that
the sale was ‘perfected by
acceptance’ (i.e. was not subject to
contract). On this basis, it was
agreed between all parties that
there would be no compromis
(contract) and that the parties
would go straight to the acte de
vente (completion). Everyone felt
this was simpler and avoided
spending time on a formal
contract. The terms of the acte de
vente were agreed.
Mr X put his notaire in funds.
The seller and buyer’s notaires
turned up to the scheduled
completion meeting at which the
seller announced that he had
made a “mistake” and could not
sell the flat to Mr X. He offered a
similar flat in the same building.
Mr X was not prepared to
change, and the seller walked out
of the completion meeting. It
turned out that the seller had been
contacted by another buyer who
particularly wanted the flat and

was prepared to pay over the odds

for it.

The problems surrounding offer

and acceptance in property sales

are a source of significant

litigation under French law – and

in central Paris this been

exacerbated by the recent sharp

increase in prices.

Letter of the law

To be valid, any offer must be

precise and firm (according to

Article 1114 of the French Civil

Code). To be an acceptance, the

intention of the recipient of the

offer must be the same as the

intention of the person who makes

the offer. There is acceptance of

the offer if the recipient expresses

his full agreement with the

proposal made to him (article

1118 French Civil Code).

If the acceptance is different

from the terms of the offer, it will

not be a valid acceptance but

rather a counter offer.

An offer letter drawn up by the

estate agent, which is signed by all

parties and is clear as to the

property, the parties and the price,

will operate as a binding contract

under French law. Mr X can force

the seller to complete, as there is

no need for a formal contract to

make the arrangement binding.

What should Mr X do?

Mr X should decide whether he

wishes to treat the agreement as

rescinded and walk away and buy

elsewhere or pursue the purchase.

If he wants to press on, he

should immediately ask his notaire

to call a huissier (a sort of bailiff)

to attend the notaire’s office. The

notaire should make a formal

declaration to the huissier that he

was in funds to complete and that

the seller attended the completion

meeting and attempted to switch

the flats. He should also produce

the estate agent’s signed offer

letter. France is much more

formalistic regarding proof of the

facts, and these written sworn

constats (statements) to the facts

by a huissier are very difficult to

David Anderson is a solicitor-

advocate and chartered tax adviser

at Sykes Anderson Perry Limited

Tel: 020 3794 5959

saplaw.co.uk

 The problems surrounding offer and

acceptance in property sales are a source of

significant litigation under French law 

EXPERT ADVICE

©TarikVision– iStock / Getty Images Plus

overturn later in court.

Mr X should immediately

instruct an avocat to serve notice

on the seller that he is in breach of

contract and give him a short time

to attend a further completion

meeting. The letter should spell

out all the facts. If he fails to do so,

proceedings should be issued in

the court applicable to where the

property is situated with a request

for an expedited hearing date.

The judge will usually order that

the sale is completed and that the

seller must pay an astreinte, or

penalty, of a fixed amount for each

day of delay. The judge would fix

the astreinte, and amounts of €500

per day are normal. The judge can

order that if there is no completion

by a certain date, the judgement

becomes the sale document.

Alternatively, the seller may have

to go back to court for a sale order.

The judgement should be sent

to the publicité foncière (similar to

the UK’s Land Registry) so that the

seller cannot sell to a third party.

If, as in this case, there is a

likelihood the seller will sell to a

third party, an urgent application

should be made to the court for an

injunction. It is sensible to serve

the court orders on the seller’s

notaire as well.

Mr X should also speak to the

estate agent who will normally be

keen to see the sale complete and

receive his commission. The agent

may also be involved in the claim

for his commission.

On costs, Mr X needs to be

aware that the costs awarded

in French courts are usually

much lower than in England.

Unfortunately, he may be awarded

only €2,000 and end up funding

the balance of his costs himself. 

Everything you need to

know before completing a

French property purchase

completefrance.com/

french-property/law

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