Declaration of Claim and Presumption (Safeguard Procedure)

On 8 February 2023, the French Cour de cassation (commercial chamber; F-B, n°21-19.330) had the opportunity to reiterate that the knowledge of the claim by the judicial representative (mandataire judiciaire) creates a presumption of such declaration of claim by the creditor, but only within the limit of the content of the information provided for to the judicial representative by the debtor (see previous decision of the commercial chamber dated 5 September 2018 – 17-18.516; P+B+I).

Under French law, a creditor has to declare his claim within a 2-month period otherwise his claim is barred by effluxion of time (forclusion). It has to be stressed that forclusion has not the same legal meaning as prescription and is more stringent. This is due to the fact that the commercial activity of the debtor has to be protected.

In the event of safeguard procedure, the receiver (administrateur) has to contemplate the possibility to restructure and to turn around the company. In this perspective, article L622-6 alinea 2 of the French commercial Code states that “The debtor gives to the receiver and to the judicial representative, for the purposes of the exercise of their mandate, the list of his creditors, of the amount of his debts and material ongoing contracts.”

This gives the receiver the possibility to assess the strengths and weaknesses of the company, receiving amongst others, a list of the creditors edited by the company itself. In this perspective, the receiver is informed of the creditors of the company without the declaration of claim of the creditors. According to the French Cour de cassation, such information creates a presumption of a declaration of claim effectuated by the creditor and only within the limit of the content of the information provided for to the receiver by the debtor.

As a result, a difference between the information provided for by the debtor and a separate declaration of claim by the creditor may arise, especially regarding the amount of the claim, the debtor seeking to minimize such amount. In such a context, if a creditor does not declare his claim, he should nevertheless be in the position to rely on the information provided for by the debtor, at least. In addition, if the creditor also declares his claim, such later declaration shall prevail (see on this question F. Pérochon, with M. Laroche, F. Reille, T. Favario and A. Donnette, Entreprises en difficulté LGDJ, 11 ed. 2022, n°2763 et seq., p. 1113).

One should be puzzled to observe that from primary antagonist positions (creditor against debtor) a party (the debtor) can act on behalf of the other (the creditor) to secure a claim against himself. This why this new legal scheme has been named a revolution (see F. Pérochon, op. cit.).

Up to date 8 February 2023.

Ludovic Timbal Duclaux de Martin, EIRL Me Ludovic Timbal Duclaux de Martin Avocat à la Cour – Barreau de Paris 

Criminal procedure and characterization

The French criminal Cour de cassation (n°20-85.968 – FS B) stated on 10 January 2023 (n°20-85.968 – FS B) that article 388 of the French Code de procédure

pénale shall be construed as prohibiting the criminal judge from adding or substituting distinct facts during the characterization process (except with the express consent of the accused).

The import of this decision has to be stressed. The French lower courts (Tribunal correctionnel and Cour d’appel) initially agreed with such unilateral change of characterization. A such, according to the French criminal supreme Court, if the duty of the criminal judge is to restore the due characterization of the facts to name the accurate alleged offence, it is on the condition that there shall not be addition or substitution of facts which are different from those of the initial bill of indictment. Only the accused is entitled to agree with such a change, leading to a potential other more severe conviction.

This is now one of gravity centers of these cases. We know that French doctrine (Bernard BoulocProcédure pénaleDalloz, 27ème éd. n°690, p. 609) clearly mentions the possibility for a judge to change the characterization of facts but not the facts themselves. This later, according to this author, in no events shall be changed. In addition, it is a constant Human Rights principle that any recharacterization has to be made in accordance with the nulla poena sine lege principle. The express consent of the accused carve out has also of course to be applied within such a secular principle.

In light of this, one should always remember that procedure is the crucial element that has to be preserved before stating on the merits of the case. If the power of the judge increases, the Human Rights guarantees have also to be increased within the same intensity. In this perspective, it remains the duty of the lawyers to protect the rights of the accused and ensure that the express consent of the accused has not been obtained by duress (or by any other illegal means).

This decision is in line with the ECHR case law (Pélissier et Sassi c. France – Req.254444/94 dated 25 March 1999 see obs. Sofian Goudjil in Dalloz Actualité 10 February 2023) and France should be welcome for the reiteration of this solution as not only the accused made an appeal before the Court of appeal allowing then the Cour de cassation to state the case but also the representative of the French State (the Procureur de la République). In addition, the French supreme Court also clearly shows its willingness to release this decision within a wide doctrinal specter (due to the B letter classification – formerly “P”).

Ludovic Timbal Duclaux de Martin, EIRL Me Ludovic Timbal Duclaux de Martin Avocat à la Cour – Barreau de Paris

Up to date 10 February 2023.