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Company Law (en cours)

The corporate purpose of a civil company must, in principle, correspond to the exercise of a civil activity. In the event of a discrepancy between the corporate purpose and the activity carried out, the Court of Cassation sometimes gives precedence to one, sometimes to the other, making the solutions appear difficult to discern.

In a decision that is admittedly isolated but published in the Bulle …

Civil object

BONDUELLE, Drafting of articles of association for civil companies, JCP N 2008, No 1349.

The corporate purpose of a civil company must, in principle, correspond to the exercise of a civil activity. In the event of a discrepancy between the corporate purpose and the activity carried out, the Court of Cassation sometimes gives precedence to one, sometimes to the other, making the solutions appear difficult to discern.

In a decision that is admittedly isolated but published in the Bulletin, the Court of Cassation thus went beyond the appearance created by the declared purpose to hold that the nature of the company should rather be assessed in light of its actual activity .

In the vast majority of cases, it instead prioritizes the corporate purpose to consider that acts contrary to it must be annulled. This is the case when a non-reinstallation clause contained in the internal regulations of a non-trading private company imposes significant restrictions on the free exercise of their right of withdrawal by the partners, while the company's statutes give it the exclusive purpose of facilitating the exercise of each member's activity . It is also the case when the sole asset constituting the patrimony of a civil company is sold to a third party, while its corporate purpose does not expressly provide for the ability to sell the property. Many decisions indeed hold that statutes that only refer to “the acquisition and management of real estate assets” or “the ownership of real estate” do not authorize its sale and, exceeding the corporate purpose, the act is subject to annulment . However, some divergent decisions consider, on the contrary, that “the ownership of a property” grants its holder the right to dispose of it . To secure the transaction in light of these conflicting solutions, it is recommended that the partners convene a general meeting deciding by the majority required for amending the statutes, to authorize the manager to conclude the sale .

In other cases, finally, it is the compass of the corporate interest that allows for the annulment of an act that is otherwise in compliance with, or not contrary to, the corporate purpose. This is the case, notably, of a loan taken out by a real estate investment company (SCI) to finance a current account contribution by its manager in another company of which she is also the manager , or of the security interest  or guarantee  given by the company for a loan taken out by a partner. Indeed, even if such guarantees are not expressly prohibited by the statutory corporate purpose, they may be declared contrary to the corporate interest when their mobilization would be likely to jeopardize the company's existence by risking the loss of its sole asset.

Cass. 3e civ., 5 July 2000, LawLex202200007500JBJ.

Cass. com., 1 March 2011, LawLex202200004053JBJ.

Cass. 3e civ., 23 November 2023, LawLex202400003947JBJ; 5 November 2020, LawLex202200003580JBJ; 23 October 2013, LawLex202200002980JBJ; 31 March 1999, LawLex202300009276JBJ.

Cass. 3e civ., 11 May 2022, LawLex202200010374JBJ; 18 December 2001, LawLex202300009277JBJ; Cass. com., 26 February 2008, LawLex202200002983JBJ.

Cass. 3e civ., 6 September 2011, LawLex202200006155JBJ. - See also, a contrario, Cass. 1re civ., 11 January 2023, LawLex202300009716JBJ. - Contra, Cass. civ. 3e, 12 September 2012, LawLex202300009791JBJ, considering that the unanimous consent of the partners is not sufficient to repurchase the operation.

Cass. 3e civ., 15 October 2015, LawLex202300009646JBJ.

Cass. civ. 3e, 13 April 2023, LawLex202300012888JBJ; 12 September 2012, LawLex202300009791JBJ; Cass. com., 23 September 2014, LawLex202200007373JBJ.

Cass. 1re civ., 11 January 2023, LawLex202300009716JBJ.

Company Law (en cours)

655. Civil object(1)

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

655. Civil object(1)

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