It was 11:47 at night when my phone rang. “Ilan, I have a problem,” said Danny, a longtime client of mine, his voice trembling. “The French sellers want to cancel the deal. After two weeks of negotiation, they suddenly froze.”
Danny, an experienced Israeli real estate developer with an impressive investment portfolio in the US, had decided to expand into Europe. The goal: a luxury residential building in Paris's 16th arrondissement. 8 million euros. An excellent location. Conservative sellers, a family that had held the property for three generations.
“Send me the contract you gave them,” I asked.
When I opened the file, I immediately understood what had happened.
92 pages. In English. Full of complex Indemnification clauses, 18 pages of Representations & Warranties, and Escrow structures that sounded like planning a military invasion.
“Who wrote this?” I asked.
“My lawyer from New York,” Danny answered proudly. “He's the best. I've done five deals with him in Manhattan.”
Here is the problem: he did a deal in Paris as if he were doing a deal in Manhattan.
The cultural-legal crisis
The next morning I flew to Paris. A meeting with the sellers' lawyer, Monsieur Dupont, 67, an office with antique wooden furniture and photos of his grandfather, who founded the firm in 1923.
“Monsieur,” he began with meticulous French politeness, “my clients are very troubled. This contract... how shall I put it... il n'a pas de confiance.”
“It has no trust?” I repeated.
“Exactly,” he explained. “In France, we live under the Civil Code. We have had a Code Civil since Napoleon. Every real estate contract rests on centuries of clear law. When a contract like this arrives,” he waved the 92 pages, “it means the other side doesn't trust us, doesn't trust the system, and wants to protect against every possible apocalyptic scenario.”
He was completely right.
The basic difference
In the US, in a Common Law system, the contract is everything. There is no comprehensive civil code, so lawyers must anticipate every case, every exception, every possibility. That's why 100 pages is not unusual - it is necessary.
In Europe, especially in Civil Law countries (France, Germany, Greece, Spain), the law already regulates everything. The contract only needs to adapt the general principle to the specific case. 12-15 pages is average. 30 pages is already suspicious.
When an Israeli arrives in Europe with an “American” contract, the implied message is:
- “I don't trust you”
- “I don't trust your legal system”
- “I'm here to exploit you”
The solution: building legal trust
I sat with Danny and explained that we needed to start over. Not legally - culturally.
Step 1: Acknowledging the local system
We met the French family again. Danny apologized in person. “I apologize. It was my mistake. I didn't realize there was another way. I want to do this the way it's customary here, in France.”
Monsieur Dupont's eyes softened.
Step 2: A local lawyer leads
We hired a respected French lawyer (from a firm with 150 years of history) to work alongside me. He prepared a 14-page contract, in French, with translation into Hebrew and English. Every clause was based on the French Civil Code.
Step 3: Transparency and simplicity
Instead of a complex Escrow in London, we agreed on a local French notary who would hold the money. Instead of 18 pages of R&W, one clause: “The seller declares that the property is free of debts and liens according to the public registry.” Instead of endless Indemnification clauses, we agreed: “Hidden liabilities will be handled in accordance with French law.”
Step 4: Building a relationship
Danny invited the family to dinner. They talked about the history of the building, about the grandfather who built it after the war. Danny showed genuine respect for the heritage.
The end: 7.8 million euros and lifelong friendship
The deal closed after three weeks. The French family even took 200,000 euros off the price because “Danny understood our values.”
Today, three years later, Danny has done four more deals in Paris and two in Athens. Each time, he starts with a local lawyer, a short contract, and building trust.
The lesson for Israeli developers
If you are moving from the US to Europe (or vice versa):
- Identify the legal system - Common Law ≠ Civil Law
- Work with locals - not only for formalities, but because they understand the culture
- Less is more - a giant contract = lack of trust
- Respect the local culture - legal and social
- Invest the time - trust is built more slowly in Europe, but lasts for years
Remember: in the global world, the most important sentence is not the one written in the contract.
It is the unwritten law of mutual respect.
Stories are based on real situations, with identifying details changed. Not legal advice.
Translated from the Hebrew original. עברית