Bankruptcy Law

In the absence of a connectedness between two claims declared as liabilities in the receivership procedure, legal set-off can be invoked . Article 1347 of the Civil Code defines set-off as the simultaneous extinction of reciprocal obligations between two persons. Article 1347-1 of the Civil Code specifies that legal set-off can only occur between two obligations that are fungible, certain, liquid  …

Fungible, certain, liquid and due obligations

In the absence of a connectedness between two claims declared as liabilities in the receivership procedure, legal set-off can be invoked . Article 1347 of the Civil Code defines set-off as the simultaneous extinction of reciprocal obligations between two persons. Article 1347-1 of the Civil Code specifies that legal set-off can only occur between two obligations that are fungible, certain, liquid and due.

The court may not reject a creditor's claim for legal set-off between his sale price debt and his dividend restitution claim on the grounds of lack of connectedness, without investigating whether the conditions for such set-off had not been met prior to the judgment opening the debtor's insolvency procedure . Indeed, the absence of connectedness between debts does not exclude the possibility of legal set-off, provided that they are reciprocal, certain, liquid and due before the opening judgment .

Since the conditions are cumulative, legal set-off cannot validly take place in the absence of reciprocity between the claims and debts invoked, when the court opens two separate insolvency proceedings against an EARL and its manager, after ruling out any merger of assets . Similarly, there can be no legal set-off between the guarantee held by the tax authorities and the Trésor Public's claim if the latter was not due and payable before the judgment opening the debtor's insolvency procedure . Nor can set-off be invoked between the debit balance of a current account and a credit securities account, in the absence of fungibility between their items .

Prior to the reform of contract law, when two reciprocal debts, arising from the debit balance of a current account and a holdback, were certain, liquid and due before the opening of the debtor's insolvency procedure, legal set-off ipso jure could be invoked at any time during the procedure . Accordingly, in the case of claims arising prior to the date of entry into force of the Ordinance of 10 February 2016 , legal set-off could be invoked between a creditor's debt to the debtor in respect of unpaid invoices and its claim against the debtor, provided that the conditions for legal set-off had been met prior to the opening judgment, without it being necessary to invoke it on the date on which it takes effect .

The reform of contract law amended Article 1347 to require that set-off be invoked at the time when the conditions for it are met.

Cass. com. 8 January 2002, LawLex202100002692JBJ (LJ), holding that a partner to whom the legal representative makes a claim, after the opening of the procedure, for payment of the unpaid portion of the share capital, may invoke the legal set-off against the balance of his current account, which arose prior to the opening judgment, even if these claims are not related.

Cass. com., 18 September 2012, LawLex202100005236JBJ (LJ).

Cass. com., 12 January 2010, LawLex202100002694JBJ (LJ).

Cass. com., 5 February 2013, LawLex202100004167JBJ (LJ).

Cass. com., 27 October 1998, LawLex202100002695JBJ (LJ).

Cass. com., 16 December 2014, LawLex202100002747JBJ (LJ).

Cass. com., 27 September 2011, LawLex202100005237JBJ (LJ).

Ordinance 2016-131 of 10 February 2016 reforming contract law, the general regime and proof of obligations.

CA Pau, 15 October 2020, LawLex202100006242JBJ (LJ).

Bankruptcy Law

390. Fungible, certain, liquid and due obligations

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390. Fungible, certain, liquid and due obligations

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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