Anyone who obtains a loan to carry out a specific operation cannot complain of being sanctioned by the bank if he used the funds for another project. The clause in the loan contract which prohibits using the funds for an operation other than that planned is not an unfair clause, clarified the Court of Cassation.
A borrower, who had obtained a real estate loan to acquire a main residence, but had committed the funds to another project, lost the lawsuit he had brought against the bank when it broke the contract, demanding immediate repayment funds.
The obligation to use the funds for the operation specified in the contract is a determining condition of the lender’s consent to grant the funds, explained the Court of Cassation. The clause which provides for the expiration of the term, that is to say the termination of the contract with immediate reimbursement in the event of non-compliance with this obligation, only dictates the sanction which attaches to the obligation to contract in good faith. faith. It is not abusive because it does not create a significant imbalance in favor of the professional lender and to the detriment of the borrower.
For example, it does not give the banker a discretionary right to terminate the contract, contrary to what was argued by the borrower who retains the option of going to court. The Court of Cassation recalled that the exercise of this sanction by the bank must be preceded by a formal notice clearly specifying the reason for the termination of the contract and the period granted to the borrower to return to compliance with the terms of the contract. CONTRACT.
(Cass. Civ 1, 24.1.2024, Q 22-12.222).
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