Promise of Sale and Abuse of Confidence: What the 1969 Judgment Reveals

Imagine: you own a building in Bordeaux, and you entrust an agent with managing and selling your apartments. On the same day, you sign a preliminary contract with this agent, but with a clause stating that he will only become the owner upon the notarial deed. Then, without waiting, the agent sells one of the apartments to a third party and pockets the price. What happens? This situation, experienced by a Bordeaux owner in 1965, gave rise to a famous judgment of the Cour de cassation on 13 May 1969 (no. 68-93.570).

The question every owner asks: does a promise of sale immediately constitute a sale? And what does someone risk who sells prematurely? The answer is nuanced. Article 1589 of the Civil Code states the principle: a promise of sale constitutes a sale when there is mutual consent on the thing and the price. But caution: this principle gives way if the parties have expressed a contrary intention or if they have made the promise subject to a suspensive condition. In the case decided, the promise was conditional on the execution of a notarial deed. The agent, by selling before that deed, committed an abuse of confidence.

This judgment, rendered over fifty years ago, remains a reference for all property professionals. It reminds that the line between promise and sale is fragile, and selling prematurely can be costly. Whether you are an owner in Périgueux or a tenant in Bordeaux, this decision concerns you. Analysis.

The facts: a story that happens every day

Mr X, owner of a building in Bordeaux, entrusts Mr Y, an estate agent, with a mandate to manage and sell by apartments. On the same day, they sign a preliminary contract (synallagmatic promise) covering the entire building, with a clause stipulating that Mr Y would only become the owner upon the signature of the notarial deed of sale. In other words, the sale was not immediate: it was suspended until the completion of a formality.

A few months later, without waiting for the notarial deed, Mr Y sells one of the apartments to a third party and pockets the price. He does not remit anything to Mr X. The latter, discovering the truth, files a complaint for abuse of confidence (misappropriation of funds entrusted under the mandate). The criminal court convicts Mr Y, who appeals. The Court of Appeal upholds the conviction, but Mr Y appeals to the Cour de cassation.

Before the Cour de cassation, Mr Y argues that the preliminary contract constituted an immediate sale, so he was already the owner of the building. Therefore, he had the right to sell the apartment. But the Court does not follow him: it reminds that a promise of sale only constitutes a sale if the parties have not provided for a suspensive condition. However, here the clause requiring the notarial deed was a suspensive condition. As long as the deed had not been signed, Mr Y was not the owner, and he had no right to sell. By doing so, he abused Mr X's confidence.

The reasoning of the court — analysed

The Cour de cassation relies on Article 1589 of the Civil Code (the promise of sale constitutes a sale) but clarifies its limits. It states a clear principle: if the parties have expressed a contrary intention or if they have made their promise subject to a suspensive condition, then the promise does not constitute an immediate sale. In other words, mutual consent is not enough if the parties have made the sale conditional on a future event.

In this case, the preliminary contract contained an explicit clause: the agent would only become the owner upon the execution of the notarial deed. This clause constituted a suspensive condition. Consequently, Mr Y was not the owner before the notarial deed. By selling the apartment beforehand, he misappropriated the funds entrusted to him under the mandate, thus constituting an abuse of confidence (Article 314-1 of the Criminal Code).

What few people know is that the Court could have considered the preliminary contract as a perfect sale if the parties had not stipulated a condition. But here, the parties' intention was clear: the sale was not immediate. The judges therefore validated the reasoning of the lower courts, which had convicted the agent for abuse of confidence. The decision is a confirmation of prior case law: contractual freedom allows parties to arrange the effects of the promise.

In short, this judgment reminds that a preliminary contract is not automatically a sale. You must read the clauses. And if a suspensive condition is provided, the sale only occurs after its fulfilment. However, be careful: if the promise is firm and unconditional, it constitutes an immediate sale. The nuance is crucial.

What it changes for you — concretely

For landlord owners: if you sign a promise of sale with a suspensive condition (e.g., obtaining a loan, signing a notarial deed), you remain the owner until the condition is fulfilled. Do not let the buyer occupy or sell the premises beforehand. Concrete example: in Périgueux, an owner signed a preliminary contract with a suspensive condition of obtaining a loan. The buyer moved in before the notarial deed, then did not obtain his loan. The owner had to start eviction proceedings. With this judgment, he could have required the buyer to wait.

For buyers: if you sign a promise of sale, check whether it is firm or conditional. If it is conditional, you are not the owner until the condition is fulfilled. Do not sell your property before you are sure you own the new one. A Bordeaux buyer thus lost significant sums by reselling an apartment before the notarial deed, thinking he was already the owner.

For property professionals: be cautious. An agent who sells before the notarial deed commits an abuse of confidence, punishable by up to 5 years' imprisonment and a fine of €375,000 (Article 314-1 of the Criminal Code). undefined, I have encountered cases where estate agents, too hasty, had to repay considerable sums. If you are in this situation, you must consult a lawyer before any sale.

If you are a co-owner: this decision may concern you if your managing agent sells common parts before the general meeting. The same logic applies: as long as the conditions are not met, the sale is not valid.

Four tips to avoid this type of dispute

• Read the clauses of your promise of sale carefully. If a suspensive condition is provided (notarial deed, loan approval, etc.), do not consider the sale as finalised before its fulfilment. Have a lawyer assist you in deciphering the terms.
• Do not sell a property before you own it. If you are a buyer, wait for the notarial deed to resell. If you are an agent, do not collect the price before the conditions are lifted.
• Always formalise suspensive conditions in writing. An oral clause is difficult to prove. In the preliminary contract, clearly state that the sale is subject to a specific event.
• In case of doubt, seek legal advice. A 30-minute consultation can save you years of litigation. For example, in Bordeaux, an owner avoided a dispute by having his preliminary contract checked before signing.

Further reading: related case law and developments

Before this judgment, the Cour de cassation had already stated the principle of Article 1589 in a judgment of 7 March 1960 (Bull. civ. I, no. 132). But the 1969 judgment is the first to so clearly specify the effect of a suspensive condition on a promise. Since then, case law has evolved: for example, the judgment of 3 December 2002 (no. 00-18.953) held that a unilateral promise of sale only constitutes a sale upon exercise of the option, reinforcing the distinction between promise and sale.

The trend of the courts is to protect the parties' consent: if the conditions are not fulfilled, the sale does not take place. This means that, for the future, judges are increasingly demanding regarding the drafting of clauses. A simple "subject to the signing of the notarial deed" is enough to delay the transfer of ownership. However, be careful: certain ambiguous clauses may be interpreted against the person who drafted them (principle of contra proferentem).

In practice, this case law remains relevant. If you are faced with a premature sale, you can invoke the 1969 judgment to establish an abuse of confidence. But do not forget that each case is unique: consult a lawyer.

What you absolutely must remember

FAQ – Promise of sale and abuse of confidence

• Does a promise of sale always constitute a sale? No, only if the parties agree on the thing and the price without a suspensive condition. If a condition is provided, the sale only occurs after its fulfilment.
• What if I have signed a preliminary contract with a suspensive condition and the buyer sells before the notarial deed? You can file a complaint for abuse of confidence. The sale by the buyer is void, and he must return the price to you.
• Can I sell my property after signing a promise of sale? Yes, if the promise is not firm. But be careful: if you sell to another buyer, you risk damages. It is better to wait for the conditions to be lifted.
• What are the time limits for action? The limitation period for abuse of confidence is 6 years from the discovery of the misappropriation. Do not delay in consulting a lawyer.
• What is the cost of proceedings? Lawyer's fees vary, but a first consultation (€45 with Maître Zakine) allows you to assess your chances.

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