Bankruptcy Law

Under Article L. 641-11-1, III of the Commercial Code, contracts in progress may be terminated ipso jure for failure by the receiver  or, if the latter has not been appointed, by the liquidator, to respond to a formal notice to exercise the option to continue, and for non-payment by the contracting party. Termination is recorded by the bankruptcy judge at the request of any interested party. 
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Termination ipso jure of not-continued contracts

Under Article L. 641-11-1, III of the Commercial Code, contracts in progress may be terminated ipso jure for failure by the receiver  or, if the latter has not been appointed, by the liquidator, to respond to a formal notice to exercise the option to continue, and for non-payment by the contracting party. Termination is recorded by the bankruptcy judge at the request of any interested party. 

A contract in progress may be terminated ipso jure after the other party has served formal notice on the receiver or liquidator to decide whether or not to continue the contract, but has failed to respond for more than one month. Case law assimilates the failure of the receiver to respond within the one-month time-limit to the latter's express refusal , within the same time-limit, to continue the contract . Termination of an existing contract ipso jure invalidates concomitant and interdependent contracts, such as a finance lease, which relates to the same equipment as the maintenance contract terminated ipso jure, without the need for proof of impossibility of use .

The current contract is also automatically terminated in the event of non-payment . In accordance with Article L. 641-11-1, III of the Commercial Code, when the performance of a continuing contract involves the payment of a sum of money, this must be made in cash, unless the receiver is able to obtain acceptance of payment terms from the debtor's co-contractor. In the absence of payment terms, the receiver who fails to pay the co-contractor in cash is liable to terminate the contract ipso jure, unless the co-contractor agrees to continue the contractual relationship. However, a co-contractor who wishes to continue the lease with the assignee may not request termination of the contract at the debtor's expense on the grounds of rental arrears . 

In accordance with Article R. 641-21(2) of the Commercial Code, “[t]he bankruptcy judge shall, at the request of any interested party, declare the termination of contracts ipso jure in the cases provided for in III of Article L. 641-11-1”. This request renders the automatic termination effective . The text specifies that the bankruptcy judge also establishes the date of termination, without formally granting him any discretionary power in this respect . The bankruptcy judge is not required to record the termination of the contract where this is the result of an express position taken by the receiver in a letter sent to the other party . Although not res judicata with regard to third parties, the ordinance of the bankruptcy judge recording or pronouncing the termination of a current contract, pursuant to Article L. 641-11-1 of the Commercial Code, is nevertheless enforceable against them, so that the termination of the maintenance contract entails, as of the date of its pronouncement, the lapse of the interdependent finance lease contract .

Cass. com., 17 February 2015, LawLex202200000492JBJ (LJ) considering that the automatic termination of a current leasing contract, which takes place on the day the other party is informed of the decision of the legal representative not to continue the contract, presupposes an express expression of intent on the part of the latter.

Cass. com., 18 March 2003, LawLex202100001151JBJ (RJ) ; 20 October 2021, LawLex202100005998JBJ (LJ). See also Cons. d'Et. 25 January 2006, LawLex202100003130JBJ (LJ).

Cass. com., 20 October 2021, cited above.

Cass. com., 17 February 2015, cited above.

Cass. com., 20 September 2017, LawLex202100003303JBJ (RJ).

CA Orléans, 20 August 2020, LawLex202100005160JBJ (RJ).

Cass. com., 11 September 2019, LawLex202200010526JBJ (LJ).

Bankruptcy Law

798. Termination ipso jure of not-continued contracts

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798. Termination ipso jure of not-continued contracts

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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