Unilateral Promise to Sell: the Seller Can No Longer Withdraw After Signature

You have signed a unilateral promise to sell, and suddenly the seller changes their mind. They tell you they no longer wish to sell. What can you do? Until recently, some thought the seller could withdraw as long as the buyer had not exercised the option (i.e., notified their intention to buy). But the Court of Cassation has put an end to this uncertainty. By a judgment of 20 October 2021 (No. 20-18.514), it affirmed that, in a unilateral promise to sell, the promisor (the seller) is definitively obliged to sell from the conclusion of the preliminary contract, unless otherwise stipulated. In other words, once the promise is signed, the seller cannot withdraw, even if the buyer has not yet exercised the option. This decision, rendered in a case concerning plots of land, overturns property practices. undefined in Aix-en-Provence, I regularly see cases where sellers, often under pressure, sign a promise and then try to back out. Now they know it is impossible. And buyers can rest easy: their promise is equivalent to a forced sale. But beware, it is not all so simple. Analysis.

The Facts: A Story That Happens Every Day

Mr and Mrs X, owners of several plots of land in La Ciotat, in the Bouches-du-Rhône, decide to sell a group of plots. They sign a unilateral promise to sell with a property developer, Company Y. The promise is signed on 10 January 2018. The developer is given three months to exercise the option, i.e., to notify its decision to buy. But in the meantime, the owners receive a more attractive offer from another buyer. Thinking they could withdraw, they notify the developer on 5 February 2018 that they are renouncing the sale. The developer, who had not yet exercised the option, protests and sues the sellers to obtain a forced sale. The Aix-en-Provence Court of Appeal rules in favour of the sellers: it holds that the withdrawal, made before the option was exercised, prevented the completion of the sale. The developer appeals to the Court of Cassation.

The case thus goes up to the Court of Cassation, which quashes the appeal judgment and refers the case back to the Montpellier Court of Appeal. The High Court recalls that, in a unilateral promise to sell, the promisor (the seller) is definitively bound from the signature, unless otherwise stipulated. The withdrawal, even before the option is exercised, is therefore ineffective. The sale is perfected as soon as the beneficiary exercises the option, and this exercise can occur even after the withdrawal. In short, the developer could still buy, despite the sellers' change of heart.

What is striking in this case is how quickly the dispute arose: barely a month after the signature, the sellers wanted to go back. But the law is clear: a unilateral promise to sell is a firm commitment by the seller. The beneficiary merely has an option: they may buy or not. But the seller can no longer back out.

The Court's Reasoning — Analysed

The Court of Cassation relies on Article 1124 of the Civil Code, which defines a unilateral promise to sell as a contract by which one party (the promisor) grants the other (the beneficiary) the right to opt to purchase a property. But above all, it interprets this article in the light of Article 1103 of the same Code, which provides that contracts lawfully formed have the force of law for those who have made them. In other words, once the promise is signed, the seller is bound.

The Court specifies that the unilateral promise to sell contains, in addition to the promisor's consent, a firm obligation to sell. The promisor cannot therefore unilaterally withdraw, as that would undermine their commitment. The only exception is an express clause in the promise authorising withdrawal. But in the absence of such a clause, the withdrawal is ineffective. The exercise of the option by the beneficiary, even after the withdrawal, results in the formation of the sale.

This reasoning marks a departure from previous case law, which was uncertain as to the exact moment of the seller's commitment. Some older decisions allowed the seller to withdraw as long as the option had not been exercised, because the sale was not yet perfected. But the Court of Cassation puts an end to this uncertainty: the seller's commitment is immediate and irrevocable. In other words, the unilateral promise to sell is not a mere offer, but a synallagmatic contract (creating obligations for both parties) from its conclusion.

In this case, the sellers from La Ciotat therefore lost: they had to sell their plots to the developer at the agreed price, even though they had found a better price elsewhere. The withdrawal did not help them; quite the contrary: they had to bear the costs of the proceedings and probably damages.

Note, however, that this decision does not mean the seller has no recourse. If the beneficiary does not exercise the option within the stipulated period, the promise lapses and the seller regains their freedom. But as long as the period is running, the seller is bound.

What This Means for You — Practically

For seller-owners: if you sign a unilateral promise to sell, know that you are bound from the signature. Do not sign lightly. If you have doubts, negotiate a withdrawal clause or a cooling-off period. For example, in Istres, an owner signed a promise for a 1,000 m² plot, then received an offer €20,000 higher. He tried to withdraw, but the judge ordered him to sell at the initial price. Result: a net loss of €20,000, plus legal costs.

For buyers: you are in a position of strength. Once the promise is signed, you can take your time to exercise the option (within the agreed period), even if the seller tries to back out. You can even demand a forced sale in court. Concrete example: a couple in La Ciotat signed a promise for a house, then the seller tried to withdraw to sell at a higher price. The couple sued the seller and obtained the sale at the initial price, plus damages for the harm suffered (delayed move, extended rent).

For property professionals (agents, notaries): this decision requires you to draft promises with particular care. If your seller client wishes to retain a possibility of withdrawal, you must insert a clause to that effect. For example: "The promisor reserves the right to withdraw until the option is exercised, subject to paying an indemnity of 10% of the price." Without such a clause, the seller is trapped.

Finally, for co-owners: if your co-ownership association signs a unilateral promise to sell (for example, for a co-ownership lot), know that the commitment is immediate. Ensure that the general meeting has authorised the sale and that the mandate is clear.

What few people know is that this case law also applies to promises to sell residential, commercial or agricultural property. Regardless of the nature of the property, the principle is the same.

Four Tips to Avoid This Type of Dispute

• Read the promise carefully before signing. Check whether there is a clause authorising the seller's withdrawal. If not, consider that you are definitively bound. Seek advice from a lawyer specialising in property law before signing.
• Negotiate a cooling-off period. If you are a seller and fear committing too quickly, ask for a clause allowing you to withdraw within 7 to 10 days, subject to paying an indemnity. This gives you time to compare offers.
• Keep all evidence. In case of the seller's withdrawal, keep the signed promise, email exchanges, registered letters. These elements will be crucial to prove the seller's commitment and obtain a forced sale.
• React quickly. If the seller withdraws, do not delay in exercising the option in writing (preferably by registered letter with acknowledgement of receipt) and suing. The longer you wait, the more the seller can argue that you have renounced. Act immediately within one month of the withdrawal.

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Further Analysis: Related Case Law and Developments

The Court of Cassation had already initiated this shift in a judgment of 23 June 2020 (No. 19-11.075), where it ruled that the promisor's withdrawal before the option was exercised did not prevent the sale from being formed if the beneficiary exercised the option afterwards. The 2021 judgment confirms and strengthens this position. Before 2020, case law was divided: some appeal courts considered that the seller could withdraw until the option was exercised, while others held that the commitment was immediate. Now, the trend is clearly in favour of the irrevocability of the seller's commitment.

This development is part of a broader movement to secure property transactions. The legislature, with the Macron Law of 2015, has already strengthened the protection of the buyer in unilateral promises to sell. The Court of Cassation is moving in the same direction. In the future, we can expect courts to be even stricter towards sellers who attempt to withdraw. For buyers, this is good news: their position is strengthened. For sellers, it is a call for caution.

What You Absolutely Must Remember

FAQ:

1. Can I withdraw after signing a unilateral promise to sell as a seller? No, unless the promise contains an express clause authorising you to do so. Otherwise, you are definitively bound.
2. What if the seller withdraws? Exercise the option in writing (recommended by registered letter with AR) and apply to the judicial court for a forced sale. You can also claim damages.
3. What are the time limits for action? You must exercise the option within the period provided by the promise. If the seller withdraws before that, you can exercise the option immediately. In court, you have 5 years from the withdrawal to act (ordinary limitation period).
4. Does this decision apply to promises to sell building plots? Yes, it applies to all immovable property, whether built or not.
5. Can I insert a withdrawal penalty clause in the promise? Yes, absolutely. You can provide that the seller may withdraw subject to paying an indemnity (for example, 10% of the price). This clause must be clear and precise.

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