Bankruptcy Law

In accordance with Article L. 622-21, II of the Commercial Code , the opening of insolvency procedure halts or prohibits all enforcement proceedings by prior creditors and subsequent non-privileged creditors, on movable and immovable property. This rule prevents the provisional registration of a mortgage on the debtor's real estate, even if the claim originates from an activity distinct from that  …

Prohibition of enforcement and distribution proceedings

In accordance with Article L. 622-21, II of the Commercial Code , the opening of insolvency procedure halts or prohibits all enforcement proceedings by prior creditors and subsequent non-privileged creditors, on movable and immovable property. This rule prevents the provisional registration of a mortgage on the debtor's real estate, even if the claim originates from an activity distinct from that which gave rise to the opening of a receivership procedure, in application of the principle of the unity of the debtor's assets . It also prevents the privileged creditor of the debtor's spouse from taking legal action against the joint assets, except in cases where the debtor's creditors are themselves entitled to take action . As a principle of both domestic and international public policy, the stay of individual creditor proceedings prevents the recognition and enforcement of a foreign award from having the effect of rendering enforceable an order for the payment of sums of money by the debtor . Similarly, a civil party's claim for damages intended to compensate for the harm caused by a criminal offense, which arises on the date of the occurrence of the damage, may not be the subject of any enforcement or protective measures by creditors when this date is prior to that of the opening judgment, even if the final decision fixing the amount is made after publication of this judgment .

The judgment opening a receivership procedure against a debtor entails the stay of all seizures of his remuneration  and the conversion into a seizure for payment of any previous provisional seizure . The principle of the prohibition of enforcement proceedings implies the release of a garnishee served on the garnishee before the date of cessation of payments, if at the date of the opening judgment the garnishee has not been converted into an attachment for payment , or if the seized assets have not yet been sold . For example, the release of attachments on the debtor's shares must be ordered if the seizing creditor had no vested right to them prior to the opening of the receivership . Similarly, the cessation of enforcement proceedings entails the release of a seizure-sale procedure on the debtor's real estate when, at the date of the opening judgment, this procedure has not, through the sale, produced its effects . This is the case, in particular, for seizure-sale proceedings carried out in execution of an order for the debtor to pay a wage claim , and for seizure of the debtor's partnership rights . The enforcement court is not required to rule on disputes concerning the legality of the procedure for the seizure of the debtor's real estate, once this procedure has been halted by the opening judgment . In addition, an action seeking to declare null and void proceedings instituted in violation of the prohibition on all means of execution, and to obtain restitution of sums unduly paid by the third party holder, is not subject to the statute of limitations applicable to the prohibition on payment of claims arising prior to the opening judgment .

On the other hand, the seizure-attribution of a successively enforceable claim, such as rent, made against its holder before the judgment opening the debtor's insolvency procedure, continues to have effect on sums due under this claim after the said judgment, and these cannot be apprehended by the insolvency procedure, since it produces its attributive effect from the seizure . In addition, the prohibition on prosecution following the opening of the insolvency procedure in favor of a debtor does not prevent a penal seizure of his claim from being ordered, nor does it limit the effects of such a seizure previously ordered, since it does not constitute an enforcement procedure . The bank, which is not the creditor of the grantor of a security interest to guarantee the debt of a third party, is not subject to the stay of enforcement proceedings resulting from the receivership opened against the grantor .

Article L. 622-21, II prohibits any distribution procedure that has not produced an attributive effect prior to the opening judgment. Consequently, a procedure for the distribution of the sale price of real estate sold by auction that did not produce an attributive effect with regard to creditors before the judgment opening the seized debtor's reorganization must be declared null and void . The same solution applies to the procedure for the distribution of the sale price of a business which, prior to the opening judgment, was the subject of a conventional sequestration in progress at the date of this judgment, insofar as it cannot be considered as following an enforcement procedure which produced an attributive effect prior to the opening judgment .

Applicable to the receivership pursuant to art. L. 631-14 C. com.

Cass. com., 27 November 1991, LawLex202100002513JBJ (RJ).

Cass. 2e civ., 19 May 1998, LawLex202100002593JBJ (LJ) ; Cass. com., 21 September 2010, LawLex202100002601JBJ (LJ).

Cass. com., 30 June 2021, LawLex202100005566JBJ (S).

Cass. 2e civ., 28 January 2016, LawLex202100002602JBJ (RJ).

Cass. com., 17 November 2015, LawLex202100002584JBJ (S).

Cass. com., 2 October 2007, LawLex202100002606JBJ (RJ).

Cass. mixte, 22 November 2002, LawLex202100002597JBJ (LJ).

Cass. crim., 7 August 2019, LawLex202100005199JBJ (S).

Cass. com., 25 November 2020, LawLex202100006119JBJ (RJ).

Cass. com., 17 April 2019, LawLex202100002599JBJ (RJ).

Cass. com., 22 March 2011, LawLex202100005217JBJ (LJ) ; 8 June 2010, LawLex202100002611JBJ (LJ).

Cass. com., 17 June 1997, LawLex202100002497JBJ (LJ).

Cass. com., 12 November 2020, LawLex202100006109JBJ (S).

Cass. com., 3 April 2019, LawLex202100001155JBJ (S).

Cass. 1re civ., 20 April 2022, LawLex202200002484JBJ (RJ).

Cass. com., 22 April 1997, LawLex202100002592JBJ (LJ).

Cass. com., 15 October 2002, LawLex202100002600JBJ (RJ) ; 4 January 2000, LawLex202100002607JBJ (LJ).

Cass. com., 2 February 1999, LawLex202100002499JBJ (RJ) ; Cass. 2e civ., 19 May 1998, LawLex202100002593JBJ (LJ).

Cass. com., 1 February 2000, LawLex202100002608JBJ (RJ).

Bankruptcy Law

399. Prohibition of enforcement and distribution proceedings

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

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

399. Prohibition of enforcement and distribution proceedings

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