IDuring a real estate transaction, it happens that the seller conceals from the buyer the faults of his accommodation (annoying neighbour, insolvent tenant). It also happens, more rarely, that it is the buyer who deceives the seller, as the following case shows.
On October 5, 2011, Mr.me X undertakes to sell to Mr. Y, at the price of 1.1 million euros, an apartment “occupied” (by its tenant), which the chamber of notaries estimates at 1.4 million euros, if he was “free”. Mr. Y gives himself until January 12, 2012, to decide. He then exercises the option. The sale is concluded, under the conditions provided for in the promise, on January 17, 2012.
Three years later, as part of a succession, Mr.me X is led to make inquiries with the mortgage registrar. She then discovered that, as of April 26, 2012, Mr. Y sold, “free from occupation”the maid’s room and the storage room which were attached to his accommodation.
She learns that, on November 23, 2011, i.e. between the unilateral promise to sell and the exercise of the option, Mr. Y signed a “amicable termination protocol” with the tenant. The latter, in exchange for the sum of 100,000 euros, and on the condition that the sale takes place in January, has undertaken to leave the property on March 31. Mme X realizes that, if Mr. Y had revealed this agreement to her, she could have sold her property at a higher price.
“Wilful reluctance”
She can still go to court, the time to act being five years, from the discovery of the deception. It therefore summons Mr. X before the Paris tribunal de grande instance. She asks that he be condemned to pay her 300,000 euros (difference between the price received and the one she could have received), for having breached the“obligation of loyalty, good faith and sincerity which is essential in contractual matters”.
Mr. Y admits that the purchaser is bound by this obligation. But he affirms that his good faith must be assessed on the date when the seller “consented” sale and its conditions, i.e. that of the unilateral promise. However, at that date, he had not yet concluded an arrangement with the tenant. The court agrees with him, and dismisses Mr.me X.
The Paris Court of Appealwhich it seizes, judges on the other hand that good faith must be assessed on the day when “the meeting of the wills of the seller and the buyer has taken place”. It cannot be during a “unilateral promise, where only the promisor undertakes to sell, and where the beneficiary does not contract the obligation to buy “. It is therefore January 17, 2012. However, on this date, Mr. Y had obtained the departure of the tenant, without informing Mr.me X.
The court judges, January 24, 2020than “this concealment of the release of the premises by the titular occupant (…) constitutes fraudulent concealment, giving rise to a right to damages for the seller”. What the Court of Cassation validates, on January 19 (2022, 20-13.951) : the buyer, like the seller, must act in good faith.