Business Contracts

Judicial rescission, the principal means of rescinding a contract under former Article 1184 of the Civil Code, is the last option for terminating a contract under Article 1224 of the Civil Code in the event of a serious breach in performance .
Prior to the reform of contract law, former Article 1184 of the Civil Code stipulated: “A resolutory condition is always implied in bilateral contracts, in  …

Judicial rescission

Judicial rescission, the principal means of rescinding a contract under former Article 1184 of the Civil Code, is the last option for terminating a contract under Article 1224 of the Civil Code in the event of a serious breach in performance .

Prior to the reform of contract law, former Article 1184 of the Civil Code stipulated: “A resolutory condition is always implied in bilateral contracts, in the event that one of the parties fails to fulfill his or her obligation. In this case, the contract is not automatically rescinded. The party towards whom the obligation has not been performed has the choice of either compelling the other party to perform the agreement, where this is possible, or seeking rescission with damages . Rescission must be sought in court, and the defendant may be granted a suitable period of time according to the circumstances”. As the provisions of Article 1184 were not a matter of public policy, a contracting party could nevertheless waive in advance the right to seek judicial rescission of a sale by means of a waiver, provided it was unequivocal, comprehensible to a layman, and expressed in a clear, precise and unambiguous manner.

To justify the judicial rescission of the sale, the courts required that there be a serious breach of contract , the assessment of which was left to the discretion of the lower courts .

Judicial rescission could be imposed to the exclusive detriment of the debtor of the unfulfilled obligation, i.e. either the buyer or the seller. A buyer who failed to pay the agreed price , or who had not withdrawn the goods before the expiry of the period stipulated in the contract, was therefore subject to rescission to his detriment . Conversely, the sale could be rescinded to the detriment of the seller if the latter failed in his obligation to provide information or advice  or in his obligation to deliver, including the delivery of a thing in conformity with the object promised . While the creditor of the unperformed obligation was not entitled to obtain judicial rescission in the event of insufficiently serious non-performance, the situation was different when the non-performance was attributable to both parties. In such cases, the court could declare that both parties were jointly responsible for the breach . 

Now, pursuant to Article 1227: “Termination may, in any event, be requested by a court”  . The creditor may therefore apply to the court “to have the contract rescinded, even if a resolutory clause has been provided for in the contract, or even if a procedure for rescission by notice has been engaged” , or in the event of “serious non-performance” covered by Article 1224. According to the Commercial Chamber of the Court of Cassation , serious non-performance does not necessarily mean “ culpable non-performance ”. This provision is supplemented by Article 1228, which states: “The court may, depending on the circumstances, declare or pronounce the rescission or order the performance of the contract, possibly granting a time-limit to the debtor, or award only damages”. In the event of judicial rescission, the end of the contract takes effect “either on the date set by the court or, failing that, on the date of the summons to appear before the court” (Art. 1229 Civil Code).

Art. 1224, Civil Code: “Rescission results either from the application of a rescission clause or, in the event of sufficiently serious non-performance, from notification by the creditor to the debtor or from a court judgment”.

See for an application: Cass. 1re civ, 8 November 1988, LawLex202200000900JBJ.

Report to the President of the Republic on Ordinance No 2016-131 of 10 February 2016 reforming the law of contracts, the general legal system and the proof of obligations, p. 19.

Cass. com. 18 January 2023, LawLex202300012683JBJ, in relation to a contract for catering services.

Cass. 3e civ, 26 January 2011, LawLex202300005985JBJ: the sale of building land may be rescinded if the purchaser has committed a sufficiently serious breach of his contractual obligations which he does not contest, even if the contract does not include a resolutory clause. - See also. CA Lyon, 14 April 2022, LawLex202200002123JBJ.

Cass. com. 4 June 1980, LawLex202200002815JBJ.

Cass. com. 24 September 2003, LawLex202200000045JBJ.

Cass. com. 13 May 1975, LawLex202200003180JBJ.

Cass. com. 30 June 1992, LawLex200500006100JBJ; 19 December 2006, LawLex200800001445JBJ; 22 January 2020, LawLex202000000209JBJ.

Cass. 1re civ, 14 February 1989, LawLex202200000179JBJ. See previously Cass. 1re civ, 21 February 1979, LawLex202200000176JBJ.

Cass. com, 6 September 2011, LawLex202300011528JBJ, overruled an appeal ruling that the sale had been rescinded to the joint detriment of the parties on the grounds that the plant purchased did not meet the purchaser's expectations in terms of production, since the latter had not informed the seller of the purchase agreement binding him to another undertaking, it should have investigated whether the seller had informed himself of the purchaser's needs, and then informed him of the suitability of the equipment for the intended use.

CA Lyon, 17 November 2022, LawLex202300006269JBJ.

Business Contracts

249. Judicial rescission

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249. Judicial rescission

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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