RESIDIS against GLOBAL EXPLOITATION

RESIDIS (appellant) and the company S.A.S.U. GLOBAL EXPLOITATIONSummary of the judgment of the Paris Court of Appeal (Division 1, Chamber 2) – 16 April 2026, No. 25/11179

Background and parties involved

The company S.A.S. RESIDIS (appellant) and the company S.A.S.U. GLOBAL EXPLOITATION (respondent) are both operators of tourist and student accommodation. In September 2022, RESIDIS proposed to acquire two residences (“Beaumarchais” and “Chat perché”) owned by GLOBAL EXPLOITATION. A unilateral promise to sell was signed on 30 January 2023, followed by a notarial deed of confirmation on 14 April 2023.

Dispute and proceedings

In September 2024, RESIDIS refused to pay an additional price of €1.2 million, arguing that GLOBAL EXPLOITATION had concealed a 2019 judgment (upheld on appeal in September 2023) validating the eviction of 44 co-owners of the “Beaumarchais” residence. According to RESIDIS, this judgment would have vitiated its consent and created a significant imbalance in the contract.

GLOBAL EXPLOITATION served formal notice on RESIDIS to pay the additional sum, then brought the matter before the judge hearing summary proceedings at the Paris Commercial Court in February 2025. By order of 23 May 2025, the judge ordered RESIDIS to pay a provisional sum of €1.2 million (with statutory interest from 16 October 2024) and €6,000 pursuant to Article 700 of the Code of Civil Procedure. RESIDIS lodged an appeal.

Arguments of the parties

• RESIDIS argues:
  • Fraudulent concealment: GLOBAL EXPLOITATION allegedly failed to mention the ongoing proceedings concerning the co-owners’ notices to vacate, even though this information was crucial to its consent.
  • A contractual imbalance: The price supplement clause is inapplicable due to GLOBAL EXPLOITATION’s bad faith (e.g. the mention of 109 flats in the letter of intent, when only 65 remained).
  • The failure to renew the leases: Certain disputed leases are of no value, rendering the price supplement unjustified.
• GLOBAL EXPLOITATION counters:
  • RESIDIS’s objections are not valid: The ongoing proceedings were mentioned in the annexes to the preliminary sale agreement (Annex B and the ‘summary of disputes’).
  • The price adjustment clause is clear: it is payable in full unless RESIDIS serves notices of termination with a refusal to renew covering more than 5% of the leases within 18 months. However, RESIDIS has not provided such evidence.
  • RESIDIS is indeed operating the 109 flats, which validates the payability of the price adjustment.

Decision of the Court of Appeal

The Court upholds the order of 23 May 2025 and rejects RESIDIS’s arguments:

1. No fraud or withholding of information:
   • The ongoing procedure was documented in the preliminary sale agreement (detailed annexes).
   • RESIDIS, as a professional, had the means to verify this information.
   • Any withholding of information might have justified the cancellation of the contract, but not a simple refusal to pay the additional sum.
2. Payability of the additional sum:
   • The letter of offer stipulates that leases not renewed but still in force are considered renewed.
   • RESIDIS has not proven that it was not operating certain leases or that the conditions for a reduction in the additional payment (notice of termination rate > 5%) were met.
3. Orders:
   • Confirmation of the provisional payment of €1.2 million plus statutory interest.
   • Order that RESIDIS pay the costs and an additional €6,000 to GLOBAL EXPLOITATION pursuant to Article 700.

Conclusion

The Court considers that RESIDIS’s obligation to pay is indisputable and that its objections are without foundation. The judgment illustrates the importance of contractual good faith and rigour in the performance of clauses, even in the presence of prior disputes.