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In principe, an agreement on the object of the contract and on the price is equivalent to a sale; but the conditions of a sale are rarely all combined when the parties envisaged this transaction. Notably, sales of real properties will be drawn up by a Frenc notary. Because the French notary must gather different documents, the waiting period is sometimes quite long. Until the signature of the authentic instrument, the agreement between the vendor and the purchaser is guaranteed by a preliminary contract.
The synallagmatic or reciprocal agreement to sell and purchase (or mutual agreement to sale)
The mutual agreement to sell is a contract by which two parties commit mutually. The seller commits to sell and the purchaser commits to purchase at a fixed price. Considering article 1589 of French Civil code, the mutual agreement to sale is deemed equivalent to sale "A promise of sale is the same as a sale, when there is reciprocal consent of both parties as to the thing and the price". The acceptance of the mutual agreement is equivalent to a definitive commitment of purchase. As well as the unilateral undertaking, the mutual agreement can be concluded by an authentic instrument or by an instrument under private signature.
Down payment ("acompte"), deposit ("arrhes"), compensation payment ("dedit"), penal clause
Often a down payment, a penal clause, a deposit or a compensation payment are inserted in the mutual agreement of sale and it will be necessary to determine exactly the nature of this payment.
A down payment is a part payment; it is imputed to the amount of the price. A penal clause is one by which the debtor, if he doesn't respect his commitment, will pay an indemnity fixed in advance to the creditor, and its amount is independent of the prejudice. It can be stipulated against the vendor if he stands in the way of implementation of the contract, but also against the purchaser if the sale is not implemented or if the implementation is lately reached by his fault. A deposit is enabling the parties to repudiate commitments, the party paying the deposit simply foregoing the right to restitution if it dos not proceed, while the party receiving the deposit it is under an obligation to restore double of the amount received, in the event of his default. A compensation payment works similarly, except that payment is made by one party only to the other.