Poor performance is not a "hidden defect"

A hidden defect is a defect inherent in this object, movable or immovable, objective, while a defect likely to be linked to the use made by its purchaser does not meet this definition, explains the Court of Cassation.

It was a real estate purchase made by a buyer who intended to make a rental investment and quickly discovered that the business was not as profitable as expected. The turnover of tenants, in particular, affected profitability by increasing expenses.

But for the judges, the seller can and must only guarantee the potential of what he is selling, in this case the technical potential for yield, and not guarantee what was hoped for by the buyer. It cannot guarantee economic profitability since it no longer has control over use, operation or management after the sale. The mere fact of not making the expected profit is not proof of default, the court concluded.

Profitability had however been announced, according to the purchaser, but this argument was considered insufficient by the Court.

According to the law, the hidden defect is a defect that must be guaranteed by the seller because it existed before the sale and reduces the use that could be expected of the object.

The buyer must prove that he would not have bought if he had known or would have offered a lower price. If the defect is recognized, he can obtain the cancellation of the sale or compensation.

(Cass. Civ 3, March 21.3.2019, 18, U 12.026-XNUMX).