Annulment of Sale due to Breach of Preference Agreement
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Themes
Preference agreement, commercial lease, annulment of sale, breach of contract, Civil Code, Court of Cassation, nullity, substitution, priority right
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Abstract
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Abstract
A legal document discussing the conditions and consequences of breaching a preference agreement in a commercial lease, and the possibility of annulling a sale.
Extract
[...] It will be a matter of knowing in what conditions the annulment of the sale is possible in case of non-respect of the preference agreement. By a decision of 14 February 2007, the Court of Cassation dismissed the appeal and therefore validated the decision of the Court of Appeal. It held that the parties were aware of the existence of the preference agreement and of the beneficiary's intention to invoke it. It therefore concluded that the SARL could request the annulment of the sale. [...]
[...] In addition, several times, the SELARL has expressed its willit is to take advantage of the sale of the building, which means once again that the SCI was aware of the existence of the preference agreementrence. II/ The consequence of the breach of the preference agreement The annulment of the sale - Article 1123 paragraph 2 of the Civil Code : « When a contract is concluded with a third party in breach of a preference agreement, the beneficiary may obtain compensation for the damage suffered. [...]
[...] The consequences of nullity will be that the property will either be put back on the market, or, as is the case here, the beneficiary of the preference agreement will be able to acquire the property by making an offer beforehand: Cass, 3rd civ November 2011 The existence of another recourse The notion of substitution : Article 1123, paragraph adds that 'the third party may request the judge to substitute him for the third party in the contract' This has been the subject of a reversal of jurisprudence : Cass. Ch. mixte May 2006 The Court of Cassation holds that the beneficiary of a preference agreement can require the nullity of the contract, but, in addition, he can request his substitution to the buyer = the beneficiary will ultimately be able to choose between nullity and substitution. [...]
[...] 05-21.814 - In what conditions is the annulment of a sale possible in case of non-compliance with the preferential agreement? - Detailed stop sheet and plan Stop sheet + detailed plan In this case, a tenant had concluded a commercial lease with a lessor, which contained an immovable preference agreement in favor of the tenant. The latter then made a contribution of his business assets, as well as the commercial lease, to a SARL, including the preference agreement, with the lessor's approval. [...]
