Bankruptcy Law

The Cour of Cassation strictly regulates the exercise of the action for extension in time.
In the first place, only facts occurring prior to the judgment opening the insolvency procedure of one legal entity or natural person can justify their extension to another .
Secondly, the adoption of a plan in the main procedure , or in those already opened against the person in respect of whom the extensio …

Framing the action in time

The Cour of Cassation strictly regulates the exercise of the action for extension in time.

In the first place, only facts occurring prior to the judgment opening the insolvency procedure of one legal entity or natural person can justify their extension to another .

Secondly, the adoption of a plan in the main procedure , or in those already opened against the person in respect of whom the extension is requested, is an obstacle to the extension. In fact, insolvency procedure cannot be extended to another person on the basis of the merger of assets, after the court has adopted a total  or partial  sale plan or a continuation plan  in the main procedure, even if the judgment is provisionally enforceable ipso jure .

Nor can an insolvency procedure be extended, on the basis of the merger of assets and liabilities, to another legal entity already subject to insolvency procedure, when a plan of disposal or continuation  has been adopted in the context of the latter . Conversely, an insolvency procedure initiated against one company may be extended to another, also subject to an insolvency procedure, as long as no plan has yet been adopted as part of this procedure .

A receivership procedure instituted after the safeguard plan has been rescinded, which constitute a separate procedure from the safeguard plan, cannot be extended to another company on the basis of abnormal financial flows which took place prior to the opening of the first set of procedure, all the more so when a disposal plan has been adopted . A request to extend the procedure initiated against a company to its manager, after the resolution of the plan adopted in respect of the company alone, must be rejected in the absence of proof of merger of their assets and liabilities since the judgment must adopting the plan . On the other hand, there is nothing to prevent the court from extending the insolvency procedure of one company to another on the grounds of merger of assets and liabilities, as long as this procedure has not been closed , even if the assets of the first company have been realized in the meantime .

Cass. com. 28 November 2000, LawLex202100004128JBJ (LJ); 16 October 2012, LawLex202100004138JBJ (LJ). A contrario v. Cass. com, 24 May 2005, LawLex202100004130JBJ (LJ); CA Paris, 7 September 2021, LawLex202100005672JBJ (LJ).

Cass. com., 22 October 1996, LawLex202100002133JBJ (RJ) considering that the receivership opened against one person cannot be extended to another after the approval of the settlement plan within the framework of the procedure already opened.

Cass. com., 15 March 2005, LawLex202100004176JBJ (RJ).

Cass. com., 11 July 1995, LawLex202100002130JBJ (LJ).

Cass. com., 13 November 2002, LawLex202100004143JBJ (LJ).

See in particular Cass. com. 18 January 2005, LawLex202100004112JBJ (RJ); 28 November 2000, LawLex202100004144JBJ (RJ); 5 April 2016, LawLex202100001186JBJ (LJ) considering that the adoption of a plan for the total sale of the business is an obstacle to the extension of the debtor's insolvency procedure to a third party due to merger of assets; 27 September 2017, LawLex202100001187JBJ (LJ).

See in particular Cass. com. 11 March 2020, LawLex202100004111JBJ (RJ) holding that a judgment adopting a plan for the partial disposal of a debtor's assets prevents the extension of his insolvency procedure to a third party on the grounds of confusion of assets or fictitiousness; 5 December 2018, LawLex202100001188JBJ (LJ).

Cass. com., 27 November 2001, LawLex202100002777JBJ (RJ).

Cass. com., 12 November 1991, LawLex202100002128JBJ (LJ).

Cass. com., 5 February 2002, LawLex202100002114JBJ (LJ).

Cass. com., 19 November 2003, LawLex202100002117JBJ (LJ).

Cass. com., 4 January 2000, LawLex202100004142JBJ (LJ).

See by analogy, Cass. com., 16 October 2012, LawLex202100004141JBJ (LJ).

Bankruptcy Law

304. Framing the action in time

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304. Framing the action in time

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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