This book provides a wide-ranging review of the European rules relating to distribution: exclusive purchase and exclusive supply, exclusive and selective distribution, motor vehicle distribution, franchises, commercial agents.

French Distribution Law

Some suppliers provide for unilateral termination clauses in case of a criminal offense committed by the exclusive distributor. Such clauses are limited in their effectiveness and their formulation and their implementation must comply with specific rules in order to be valid. Thus, where the clause does not refer to a criminal offense but merely to a serious breach by the exclusive distributor, it …

Termination for criminal offense.

Some suppliers provide for unilateral termination clauses in case of a criminal offense committed by the exclusive distributor. Such clauses are limited in their effectiveness and their formulation and their implementation must comply with specific rules in order to be valid. Thus, where the clause does not refer to a criminal offense but merely to a serious breach by the exclusive distributor, its implementation will be easier and will not depend on the outcome of criminal proceedings . Case law tends to impose adversarial proceedings such as to enable the exclusive distributor incurring exceptional termination based on a criminal offense the opportunity to justify its conduct . Where the offense of breach of trust is at stake, as in a case of motor vehicles left in deposit by the supplier, it is often wiser to rely on a termination clause for outstanding amounts or even for breach of the retention of title clause, even though in those cases the violation of the supplier's ownership must be proven. In effect, prior payment default clauses have proved effective in this kind of situation .

Cass. com., 16 November 1981, JurisData No 1981-703287. In this case, the wrongful practices were not limited to the initial offense having consisted in charging a customer for a seriously damaged car as if it was a company car in perfect state of maintenance, but in the fact that the continuity of the offense had to be retained insofar as its authors had caused and maintained the deceit by repeated acts for the term of the successive annual contracts. Moreover, the dealer did not act to compensate the victims of the fraud despite the supplier's incentives.

CA Paris, 31 January 2001, LawLex200200005331JBJ: the termination of a concession contract based on the criminal condemnation of the dealer for deceit is abusive where it took place suddenly, without the dealer having had the possibility to explain himself, approved by Cass. com., 8 October 2003, LawLex200300003741JBJ: the obligation to perform the contract in good faith imposes othat the supplier obtain obtain the dealer's explanations before terminating the contract, where the measure is based on the existence of a non-definitive criminal condemnation against the distributor.

CA Aix-en-Provence, 11 March 1999, LawLex200200005190JBJ: where the supplier ignores the distributor's financial difficulties, the implementation of a termination clause for lack of payment of motor vehicles before the initiation of the bankruptcy procedure is valid; CA Lyon, 3 October 1997, LawLex200200005050JBJ: a supplier does not cause any unlawful trouble by applying a contractual clause allowing it to terminate for serious breach where misappropriations of new motor vehicles left in deposit are established against its distributor; TGI Paris, 26 April 2000, LawLex200200004739JBJ: the termination of a contract is justified where, contrary to its contract duties, the distributor sells motor vehicles without having paid the price to the supplier beforehand; Cass. com., 19 December 2000, LawLex200200004786JBJ: an order to carry on a relationship is not mandatory where the termination of the contract is justified by the non-payment of motor vehicles and that the causal link between the distributor's compromised financial position and the termination of the contract is not established; TGI Paris, 2 April 2001, LawLex200300000831JBJ: the implementation of a termination clause for non-payment of motor vehicles by the distributor is justified where several summons remained unanswered; Cass. com., 19 March 2002, LawLex200200004695JBJ: the implementation of a termination clause some days after the statement of suspension of payments of the distributor is not unlawful where it is not based on that distributor's financial difficulties, of which the supplier was not aware, but penalizes the non-payment of motor vehicles.

French Distribution Law

112. Termination for criminal offense.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

112. Termination for criminal offense.

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise