Conditions suspensive, what do they correspond to?
Sale: Conditions precedent, what do they correspond to?
The condition precedent in a pre-sales agreement sets the terms upon which the sale will only push through if they are met. These commonly include:
- In the case of a condition precedent for obtaining a building permit, the sale can only take place if the buyer is granted their building permit.
- In the case of a suspensive condition of non-exercise of the right of pre-emption by the tenant or the town hall, the sale can only be carried out if both parties do not exercise their right of pre-emption.
- In the case of a loan suspensive condition, the sale can only be carried out when the buyer has obtained his loan.
French law Articles L313-40 et seq. of the Civil Code specifies that when the request is made to include the clause of the suspensive condition of obtaining credit in the pre-sales agreement, it cannot be refused since it's recognized as a right ( especially in the case where the buyer is non-professional and purchases the property for residential use).
The duration upon which any or both parties can terminate the conditions precedent is a minimum of 1 month. Usually, a longer period is provided to account for bank delays, which often leads to a total duration of around 45 to 60 days (approximately 2 months).
The invocation of a suspensive condition
The very principle of the condition precedent, as mentioned above, is to render the sale null and void if the event invoked has not occurred, giving each of the parties total freedom.
It is important to note that in the event of a non-termination of the condition precedent, any amount paid by the buyer as a security deposit upon signing the pre-sales agreement ought to be fully returned to them.
In the case that the buyer invoked the non-termination of the condition, they will then have to pay the deposit to the seller.
All of these are legally framed by French law Articles L313-40 et seq. of the Civil Code.
Waiver of a condition precedent
When the buyer wishes to waive the condition precedent concerning their obtaining a mortgage or loan, the terms should be included in the pre-sales agreement as handwritten by the buyer. This indicates that the buyer acknowledges that the recourse to a mortgage makes them unable to benefit from a suspensive condition.
- The condition precedent corresponds to a clause written in the pre-sales agreement that allows either the seller or buyer to withdraw from the real estate sale without suffering any penalty.
- The duration for the termination of the condition precedent is a minimum of 1 month.
You want to
to sell in Paris or its surroundings ?
Posted on 21/10/2021 by
Andy LECUYER
