In France, a notaire is a public official with non- judicial functions, tasked with ensuring that certain transactions — especially real estate sales — are enforceable and compliant with French law.
In this capacity, notaires hold a legal monopoly on property conveyancing. They are also able to process the initial sale and purchase contract, the compromis de vente.
Yet many international buyers, eager to secure their dream home, unwittingly agree to preparation and signing of the sale and purchase contract through the seller’s estate agent and then proceed to accept their recommendation in the choice of a shared notaire for the conveyancing process. While this practice is perfectly legal, there are wiser choices that can be made.
Estate Agents
In our own experience, buyers who have found the property of their dreams can too hastily be ushered into signing the compromis by an estate agent without fully understanding its implications.
Although often seen as a ‘formality,’ this contract is in fact legally binding: once both parties sign, neither can withdraw without penalty, except under specific legal conditions (notably the buyer’s 10-day cooling-off right — délai de rétractation - or the conditions precedent, eg mortgage).
Given the agent’s commercial interest in closing the deal, and the absence of independent legal scrutiny on the buyer’s behalf, there is a compelling case for involving a notaire from the outset. Estate agents use standard forms of contract, but one size is unlikely to fit all and changes to a contract require legal drafting.
As one commentator in France has put it: “Even the best estate agent lacks a notaire’s capacity to verify the legal status of a property. Integrity is not the issue — the legal scope of their role is.”
In short, the agent’s role is primarily commercial, with the intention of closing the sale as soon as possible; the role of the notaire primarily legal, with the intention of ensuring the validity of the contract.
Shared or Separate Notaire?
The next question is whether both parties should use the same notaire. Here, the issue is more nuanced, as by law notaires are independent, which enables them to act for both sides in a transaction.
As a result, it remains common in France (particularly in the regions) for a single notaire to act for both buyer and seller.
Nevertheless, it is difficult to see how that can be accomplished in a satisfactory manner, for as each party has their own interests to protect, the scope for independent advice and action is inevitably compromised. Thus, for instance, it might be particularly difficult for a notaire under a shared mandate to form a judgement as to whether a conditional clause in the contract had been fulfilled.
Notaires realise that dilemma, which they invariably resolve by restricting their role to the mechanical implementation of the agreement reached, minimising any advice they offer to either side. Their implicit stance is often that if no question is asked, there is no need to provide an answer.
However, what is not always understood is that each party can freely choose their own notaire, without there being any increase in the fees payable. When there are two notaires the regulated fee (which the buyer pays) is simply split between the notaires.
Many international buyers also require financial and legal advice over and above the conveyancing role. This is particularly the case with inheritance laws and taxes and ownership structures. Whilst some notaires may be willing to offer such advice as part of the process, this is not always the case.
In addition, although notaires have a legal duty to be impartial, appointing your own notaire ensures that they focus entirely on protecting your own interests. ‘Impartiality’ may not be the main quality that you seek in a shared notaire; there is a role for advocacy in the legal process. Buyers also need to be careful of any existing professional connections between a notaire and the seller and/or the estate agent. The risk of even unintended bias is preferably eliminated.
Although they cannot legally refuse to do so, some notaires are reluctant to act for only one side in the transaction. Where they agree to do so, some may be unenthusiastic, as a result of which response times may be slower. The reason often comes down to perceived extra administration, lower ‘top slice’ of the fee, or unwillingness to share control of the process.
However, there is nothing to stop the buyer finding another notaire. There is no requirement (or necessity) to even use a local notaire. Indeed, it is sometimes useful to consider resorting to a notaire used to sales to international buyers in order to anticipate as best as possible estate planning questions and to remove local influences.
International Lawyers
It is of course also always open to an international buyer to appoint a legal representative from their own country, but this adds substantially to the cost and is rarely necessary.
There are some very good international lawyers, but before engaging one buyers need to ask their lawyer just what the added value is they would bring to the process: translation can be offered by an interpreter and an explanation of the law by your own notaire. Only where the transaction is particularly complex, high value, or there are significant estate planning issues that need to be resolved as part of the transaction might it be advisable to do so.
The appointment of your own notaire (ideally one who is bi-lingual) should meet the requirements of the majority of international buyers. The process will often take longer than with a single notaire, but the use of a shared electronic platform between notaires has significantly reduced such delays. And whether it takes longer may well depend on how the two notaires divide up the tasks between them; a good working relationship could actually shorten the process.
However, whatever approach is adopted, it makes sense to adopt a pro-active approach in the transaction, to understand the law and process, and to undertake your own pre-contract enquiries, in addition to those of the legal experts.
If you would like assistance with finding a bi-lingual notaire with good international experience, drop us a line at editor@france-insider.com. and we will endeavour to assist.
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