Suspensive Condition: When the Seller Withdraws Before Signing

Imagine: you are the owner of a property in Mauguio, a small port in the Hérault. You are selling your property. The buyer obtains their loan, the suspensive condition is fulfilled. But you change your mind at the last moment. Can you terminate the sale without consequences? This question has crossed the mind of every owner or buyer at some point. The answer lies in Article 1175 of the Civil Code, a little-known but remarkably effective provision. The Court of Cassation, in a judgment of 11 April 1995, ruled: a suspensive condition must be performed in the manner that the parties presumably intended. In short, you cannot play with fire.

This decision, No. 93-11.120, is a reference for all property professionals. It reminds us that good faith is paramount in the performance of contracts. But what exactly does this change for you, whether you are an owner or buyer in Sète, Montpellier, or elsewhere? Let us delve into the facts.

The story begins with a promise to sell shares, subject to a suspensive condition: obtaining financing within a period of one year. The seller, a surgeon by profession, withdraws before the expiry of the period. The buyer sues. The Court of Appeal rules in favour of the seller, but the Court of Cassation quashes the judgment. For the supreme judges, the seller failed in his obligation of good faith by preventing the fulfilment of the condition.

The Facts: A Story Like Many Others

Mr X, owner in Mauguio, had promised to sell his shares in a company to a fellow surgeon, Mr Y. The promise was subject to a suspensive condition: obtaining a loan within one year from 1 May 1985. During this period, the parties had undertaken to perform the condition in good faith. But the seller changed his mind and refused to sign the final deed, claiming that the condition had not been fulfilled.

The buyer then took the matter to court. At first instance, the court ruled in favour of Mr Y, finding that the seller had obstructed the condition. However, the Court of Appeal reversed this judgment, considering that the condition had not been fulfilled and that the seller was free. The case went up to the Court of Cassation, which ruled in favour of the buyer.

What is interesting is that the seller himself contributed to the failure of the condition. undefined, I have come across cases where owners in Sète delayed matters to obtain a better price. But beware: the Court of Cassation reminds us that bad faith does not pay.

The Reasoning of the Court — Analysed

The Court of Cassation relies on Article 1175 of the Civil Code, which provides: "Every condition must be performed in the manner that the parties have presumably intended and understood it should be performed." In simple terms, this means that the parties must perform the condition in good faith, that is, as they agreed, and not by preventing its fulfilment.

The judges considered that the seller had violated this obligation by withdrawing without valid reason. They held that the suspensive condition (obtaining the loan) had been thwarted by the seller's conduct. The Court of Appeal had erred by merely noting that the condition had not been fulfilled, without verifying whether the seller had hindered its fulfilment.

This decision confirms consistent case law: the suspensive condition must not be a pretext to renege on an undertaking. This is a useful reminder for all property professionals. However, be aware: the solution is not automatic. The bad faith must be proven, which can be tricky. What few people know is that Article 1175 is often invoked in connection with mortgage loans.

What This Means for You — In Practical Terms

For a seller-owner in Mauguio: you cannot unilaterally withdraw after signing a promise to sell subject to a suspensive condition. If you do, you risk damages. Example: if the buyer has already paid application fees (around €500) and you refuse to sell, you will have to compensate them.

For a buyer in Sète: if the seller obstructs the suspensive condition (e.g., by refusing to provide the documents necessary for the loan), you can apply to the court for specific performance of the sale or claim damages. In a recent case, a buyer obtained €10,000 in compensation for moral and financial loss.

For a tenant: this also applies to leases. If your landlord makes the signing of the lease conditional on obtaining a guarantee, they cannot withdraw without reason.

If you are in this situation, you must act quickly: the limitation period is 5 years. Gather evidence (emails, letters) of bad faith.

Four Tips to Avoid This Type of Dispute

• Draft the suspensive condition precisely: specify the deadline, the obligations of each party, and the consequences of non-fulfilment. Avoid vague clauses.
• Keep all evidence: registered letters, emails, acknowledgements of receipt. In the event of a dispute, you will need to demonstrate good faith.
• Do not delay in taking action: if the other party obstructs, send them a formal notice in writing. Prolonged silence may be interpreted as abandonment.
• Consult a specialised lawyer: a professional will help you draft the clauses and anticipate risks. In Montpellier, Maître Zakine can advise you.

Further Reading: Related Case Law and Developments

This decision follows the line of the Court of Cassation judgment of 13 February 1985 (No. 83-16.123), which already sanctioned bad faith in the performance of a suspensive condition. Since then, the courts have become increasingly strict. In 2020, the Montpellier Court of Appeal ordered a seller to pay €15,000 in damages for concealing defects.

The trend is clear: judges protect the buyer against capricious reversals. For the future, it is likely that the suspensive condition will be interpreted even more strictly, with a reinforced duty of loyalty. What this means: if you are a seller, do not rely on a suspensive condition to wriggle out of a promise.

Key Points to Remember

FAQ:

• Can I withdraw after the suspensive condition has been fulfilled? No, the sale is final. Any withdrawal exposes you to damages.
• What if the seller refuses to sign? Send a formal notice by registered letter with acknowledgement of receipt. If they persist, apply to the court for a declaration that the sale is binding.
• What are the time limits for taking action? 5 years from the date of withdrawal. But act quickly to avoid prejudice.
• How much does a legal procedure cost? Between €1,500 and €5,000 in legal fees, depending on complexity.
• How do I prove bad faith? Through written evidence (letters, emails) or witness testimony. Lack of response may suffice.

Are you in a similar situation? A 30-minute initial consultation with Maître Zakine (€45) could save you months of litigation — and often much more. Book an appointment →