2025 - THE SCI! A REAL TRAP IF NO AGREEMENT, WITH EXIT CLAUSE, HAS BEEN SIGNED AT THE TIME OF ITS CREATION!

Circumstances: A couple thought it would be a good idea to put all their real estate assets into a real estate company (SCI). The husband and wife therefore created three SCIs, including one to which they contributed their primary residence and their vacation home. Unfortunately, things do not always go perfectly in an ideal world.

The husband decided to divorce, but all his assets were tied up in these SCIs.

Furthermore, for the SCI that held the primary and secondary residences:

• There was no income, only expenses: the deficit is growing,
• The spouses were fighting over who will contribute to what,
• The forced cohabitation was unbearable,

When contributing assets in the past, the husband lost the majority, so the wife, having become the majority shareholder, was literally doing whatever she wanted in this company (spending freely while claiming these are advances made on behalf of the company and that she therefore had a corresponding receivable against the company, having false accounts drawn up with a claim of €1.3 million registered in her favor etc.... ...).

In short, the system became unmanageable and dangerous for the husband  As a reminder, in an SCI, each partner is indefinitely liable for the debts.

Since the spouses had not been properly advised legally when setting up the SCIs, no shareholders’ agreement had been signed to include an exit clause in case of divorce or any other deadlock situation.

Dumas Structure 1st intervention:

The husband asked for the assistance of Dumas Structure to get out of this trap.

As a first step, Dumas Structure had to go to court to request, in particular, the judicial withdrawal of the husband, meaning to ask the judge to authorize and allow the SCI to force the buyback of the husband's shares. Dumas Structure obtained this withdrawal after a two-year procedure.

But even after that, the road was still long!

 - The real estate company (SCI) did not have the money to buy back the shares;

- The value of the shares, in the absence of an agreement, had to be determined by an expert appointed by the court; this would have still required at least two years of proceedings!;

- The sale of the properties had to be authorized at a shareholder’s meeting requiring both votes; therefore, the spouses had to agree on the sale, which was not the case. Moreover, even if they agreed on the sale, if money came into the SCI, the husband feared that the wife would use the money to reimburse her FAKE current account of € 1.3 million!

And these are just a few of the difficulties encountered in this case.

Dumas Structure further Intervention :

In the end, after 3 years of proceedings (5 trials, of which Dumas Structure won 3 and 2 are still pending), Dumas Structure was finally able to obtain that the spouses reach an agreement where the Parties concurred on the entire course of action to get out of this trap. Dumas Structure in cooperation with the wife's lawyer, drafted this very complex agreement The intelligence of the wife’s lawyers was an essential factor for Dumas Structure to be able to reach this agreement.

CONCLUSION: Plan Ahead ! If you create a real estate company, make sure to be assisted by a good lawyer to have a shareholder’s agreement drafted and signed, with proper exit clause to avoid such a dramatic trap.

Dominique Dumas, Managing partner, Dumas Structure: 01 56 59 00 60 - contact@dumas-structure.com