Key points
- Issue: The purchaser of a parapharmacy business sought a reduction in the purchase price, alleging that the seller had retained a WeChat account.
- Decision: The Paris Court of Appeal overturned the judgement, finding no evidence of fraud or a breach of contract on the part of the seller.
- Outcome: The sum of over €150,000 was awarded to the seller; the buyer was ordered to pay the costs (legal costs) and €2,500 to each appellant.
WeChat account allegedly retained: without proof, the purchaser must pay the full price.
In a judgement of 24 September 2026 (Case No. 24/00042), the Paris Court of Appeal (Division 5, Chamber 3) quashed the judgment and rejected the claim for a reduction in the purchase price of the business, in favour of the seller and its manager, represented by Goldwin Avocats. The purchaser claimed that a WeChat account had not been transferred, without providing any evidence to support this.
Sale of a health and beauty shop: the buyer demanded a reduction in the price.
The buyer of a parapharmacy business in Paris accused the seller of retaining the WeChat account through which sales were made. The deed of sale dated 25 March 2022 included the WeChat and Xiaohongshu accounts, without specifically identifying the account being transferred.
The Paris Commercial Court had ruled in his favour on 20 November 2023, before the Court of Appeal overturned that decision on every point.
| Issue decided | Commercial Court (2023) | Court of Appeal (2026) |
|---|---|---|
| Price reduction | Approximately €110,000 was awarded. | Dismissed |
| Non-competition clause | Approximately €15,000 was awarded. | Rejected |
| Personal misconduct by the manager | €2,000 awarded | Dismissed |
| Solicitors’ fees (Article 700) | €5,000 to be borne by the sellers | €2,500 for each appellant |
The seller, which was dissolved and subsequently placed in voluntary liquidation, and its manager lodged an appeal, represented by Goldwin Avocats.
Reduction in the sale price of the business: the court requires evidence.
The Paris Court of Appeal rejected the claim for a reduction in the sale price of the business and ordered payment of the price to the seller. Fraud, defined as manoeuvres or falsehoods intended to obtain the other party’s consent (Article 1137 of the Civil Code), was ruled out: the alleged acts occurred after the sale and could not vitiate consent (Article 1130).
The claim for a reduction on the grounds of defective performance (Articles 1217 and 1223) also failed. The bailiff’s report did not prove either that the seller managed the disputed account, or that this account existed prior to the sale. A fall in turnover or the creation of a company with a similar corporate purpose was not sufficient.
In the absence of proven breach, no violation of the non-competition clause was established. The personal liability of the director required intentional misconduct of a particularly serious nature (Article L223-22 of the Commercial Code).
Seller or purchaser: what the judgement means for you
A purchaser claiming a price reduction must prove the seller’s breach, point by point. Mere indications are not sufficient where the deed of sale remains vague.
The court noted that the deed did not identify either the account being transferred or the proportion of sales made online. For a transfer involving digital assets, it is therefore advisable to:
- specify each account being transferred by its exact identifier;
- quantify the proportion of turnover generated online;
- record in writing the handover of usernames and passwords.
However, each situation must be analysed on a case-by-case basis, depending on the terms of the deed and the available evidence.
Are you the seller or buyer of a business and there is a disagreement regarding the price or the assets being transferred? Contact one of our contract law solicitors to review your deed of sale.
Related areas of expertise
Commercial and business law › Contract law solicitor – contractual law
Frequently Asked Questions on the Sale of a Business
Yes, provided that a breach by the seller can be proven. Article 1217 of the Civil Code allows for a claim for a reduction in price in the event of defective performance, and the Court of Cassation also recognises this right in cases of fraud. In the case decided on 24 September 2026, the claim was unsuccessful because there was no evidence of a breach.
No. Fraud implies manoeuvres or lies that determined the consent at the time of signing. Subsequent actions may constitute a breach of contract, but they do not vitiate an agreement that has already been given.
The Paris Court of Appeal ruled out fraud on these grounds, as the facts cited occurred after the transfer.
Yes, but only if he has committed a breach of duty that is separate from his official duties. This must be an intentional breach of a particularly serious nature and incompatible with the normal performance of his duties.
In the absence of any proven fraud or breach by the company, the court quashed the order made at first instance requiring the managing director to pay €2,000 in damages.
Jonathan BELLAICHE
