Bankruptcy Law

The question of transmission of the retention of title clause arises when the rights and actions attached to the contract containing it are assigned to a third party. This situation arises in particular when the debtor finances the purchase of the goods by taking out a loan. Can the lender of funds, who is himself unpaid, invoke the benefit of the clause to claim the property it encumbers? The ans …

Exercise of the action to reclaim ownership by the subrogee

The question of transmission of the retention of title clause arises when the rights and actions attached to the contract containing it are assigned to a third party. This situation arises in particular when the debtor finances the purchase of the goods by taking out a loan. Can the lender of funds, who is himself unpaid, invoke the benefit of the clause to claim the property it encumbers? The answer is yes, provided the conditions for subrogation are met.

In accordance with Article 1346-1 of the Civil Code, “subrogation by contract occurs on the initiative of the creditor when the latter, receiving payment from a third party, replaces that party in his rights against the debtor”. Subrogation, which must be express, must be agreed at the same time as payment, unless the subrogating party, in an earlier act, has expressed the wish that his co-contracting party be subrogated to him at the time of payment. The concomitance of subrogation and payment may be proved by any means, and may in particular be established when the subrogating reserved seller has expressly manifested, even in a prior document, his intention to subrogate the lender in the benefit of the retention of title clause at the very moment of payment .

The effect of subrogation by contract is to invest the subrogated third party not only with the original claim, but also with all its advantages and accessories, such as the retention of title clause intended to guarantee payment . Thus, the retention of title duly agreed between the buyer in an insolvency procedure and the seller, which constitutes security for the latter's claim, can be transferred as an accessory to this claim to his bank by means of a bill of exchange accepted by the debtor .

The Court of Cassation, which accepts that the action for revendication may be brought by the moneylender, subrogated to the rights of the reserved seller , does not make the exercise of the action conditional on the due date of the claim to which the retention-of-title clause is accessory, but only on its existence .

The validity of the subrogation by contract clause of the moneylender in the seller's retention of title appeared to be called into question by an opinion of the Court of Cassation, which held that it was deemed unwritten if it falsely led the borrower, who became the owner of the property as soon as the price was paid to the seller, to believe that the security interest had been validly transferred . Fortunately, this much-criticized solution, based on the current Article L. 212-1 of the Consumer Code, does not apply to insolvency proceedings, since a few months later, the Court of Cassation once again accepted the subrogation of the lender of funds in the rights of the reserved seller, in order to guarantee repayment of the loan through the reclamation of the property, acquired with the borrowed funds, from the purchaser subject to a receivership procedure .

Cass. 1re civ., 28 May 2002, LawLex202100003383JBJ (LJ).

Cass. com., 15 March 1988, LawLex202100003369JBJ (LJ); Cass. com., 20 April 2017, LawLex202100001670JBJ (RJ).

Cass. com., 11 July 1988, LawLex202200000166JBJ (LJ).

Cass. com., 15 March 1988, LawLex202100003377JBJ (RJ).

Cass. com., 20 April 2017, LawLex202100001670JBJ (RJ).

Cass. avis, 28 November 2016, LawLex202000001689JBJ.

Bankruptcy Law

871. Exercise of the action to reclaim ownership by the subrogee

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

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

871. Exercise of the action to reclaim ownership by the subrogee

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