Question: What does the compromis de vente contain?
The compromis de vente is the document which records the agreement reached between a buyer and a seller. It is therefore important that it contains full details of the parties to the proposed sale and purchase, an accurate description of the property and details of the agreed sale price.
In addition, details of the deposit payable and to whom it is to be paid should be set out as well as an indication as to the target completion date.
The compromis will also include various conditions, many of which are standard conditions which appear in all contracts for the sale and purchase of a residential dwelling. In order for the sale to proceed to completion all conditions included in the contract must be fulfilled, except where a buyer chooses to waive a condition made in his favour and proceed at his own risk.
The standard conditions normally found in a compromis de vente are that the notary’s Land Registry search must not reveal anything adverse in the title history of the property nor reveal the existence of a charge or mortgage which would not be cleared from the proceeds of the sale. Similarly, the notary’s local authority planning search must not show any breach of planning, any undisclosed public rights or any development plans which may have an adverse impact on the property or prevent it being used for its intended use.
Probably the most important standard condition relates to the financing of the transaction; if a buyer is reliant on raising finance in order to fund the purchase, the contract must be conditional on the buyer receiving a mortgage offer meeting pre-determined criteria. If the buyer fails to secure the finance, he can pull out of the purchase and will usually be entitled to recover his deposit.
The contract may, in addition contain certain special conditions, which are specific to the transaction. Special conditions are usually introduced at the express request of the buyer. The buyer may want to make the purchase conditional on him getting outline planning permission for the conversion of a barn into habitable accommodation. Alternatively, the seller may agree to the inclusion of a special condition whereby he undertakes to have the septic tank emptied and cleaned at his own expense before completion.
In summary, the compromis de vente is designed to give legal effect to the basic agreement reached between buyer and seller. It sets out the ground rules which each party must observe and it also contains provisions detailing the consequences of the failure of one party to complete the transaction when called upon to do so. It is therefore a crucial document and care must be taken to ensure it is embodies the entire agreement of the parties. The meaning of each clause must be clear and unambiguous. Any buyer who does not speak fluent French should take independent legal advice before signing.
This article first appeared in Issue 75 of French Magazine – July/August 2009
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