Seizure of property is one of the most feared enforcement procedures under French law. It enables a creditor to sell a property belonging to the debtor in order to recover the sale price. However, this measure cannot be taken lightly. It is subject to the existence of a very specific legal document: the writ of execution. Without this document, no forced sale can be initiated. The validity of a writ of execution is a technical issue that is often at the heart of the defending against foreclosure, requiring in-depth analysis. For an exploration of foundations of the writ of execution in a more general context, our dedicated guide is at your disposal.
Understanding the basic conditions of foreclosure
Before analysing the specifics of the writ of execution in detail, it is essential to understand the three basic conditions that govern any enforcement order. foreclosure procedure. The enforcement judge is obliged to check them carefully at the orientation hearing, even if the debtor has not contested them. Firstly, the creditor must have a writ of execution. Secondly, the instrument must state that the debt is liquid, i.e. quantified or quantifiable, and due and payable when payment is due. Finally, the property in question must be seizable. The presence of a valid enforcement order has a major procedural consequence: it reverses the burden of proof. It is no longer up to the creditor to prove his claim, but up to the debtor to show that he has paid his debt.
Exhaustive typology of enforceable titles applicable to seizures of immovable property
Seizure of property is just one of the many options available under the law. civil enforcement procedures, each subject to specific rules. Article L. 111-3 of the Code of Civil Enforcement Procedures lists the instruments considered to be enforceable titles. Although this list is long, it is not entirely exhaustive, and case law regularly clarifies its scope and limits, particularly in relation to property seizures. Among the most common are: court rulings where they are enforceable, notarised deeds bearing the executory clause, divorce agreements by mutual consent, extracts from conciliation reports signed by the judge and each party, and arbitration awards declared enforceable.
Enforceable court decisions: scope and nuances of case law
The most obvious category of enforceable title is court judgments. To form the basis of an attachment, a judgement or ruling must be enforceable, i.e. no longer subject to suspensive appeal, and must have been served on the debtor beforehand. The Court of Cassation has ruled that a decision upheld on appeal cannot form the basis of an execution if the first instance judgment has not itself been served. It is also essential for the creditor to have a copy of the enforceable document. Case law has long debated the need for the judgment to contain an express order to pay. While the principle is that compulsory execution presupposes an order to pay, there are exceptions, but creditors should be cautious. Certain specific rulings also have the force of title. A ruling by the Court of Cassation overturning a decision by a court of appeal constitutes a writ of execution to obtain restitution of the sums paid in execution of the overturned ruling. Similarly, an appeal ruling overturning a first instance judgment allows recovery of sums paid under the overturned decision.
Enforceable notarial deeds: validity and limits
Notarial deeds, particularly loan agreements, are a frequent source of enforceable titles for credit institutions. A notarised loan deed can be used to initiate a property seizure as long as it states the amount of the capital and the repayment terms, thereby enabling the debt to be assessed on the date of the proceedings. This enforceability is not necessarily wiped out by the subsequent signing of private amendments, provided that the latter do not result in novation, i.e. the creation of a new debt that would extinguish the old one. Case law has also accepted that a notarial deed assigning a mortgage, guaranteeing a loan granted by a simple private deed, can constitute an enforceable title against the guarantor (a third party to the loan transaction), provided that it contains all the information needed to assess the debt guaranteed. On the other hand, a deed that merely sets a guarantee ceiling without detailing the claims is not sufficient. The formal validity of the deed is also important. For a long time, there was a debate in the case law about the fate of notarial deeds to which private powers of attorney were not attached. The Court of Cassation has finally ruled that this omission does not cause the deed to lose its authentic character and therefore its enforceability.
The European Enforcement Order (EEO): a cross-border facilitation instrument
Introduced by European Regulation 805/2004, the European Enforcement Order enables creditors to have their claims enforced in another EU Member State without going through the cumbersome exequatur procedure. This certificate, issued by the court of origin or the notary, applies to uncontested claims. In the context of a seizure of property in France, an EEO certified in another Member State (with the exception of Denmark) therefore enables the procedure to be initiated directly, subject to the challenges that the debtor may raise before the French enforcement judge, in particular to request a stay or adjustment of enforcement (sometimes in summary proceedings) in the event of an appeal in the State of origin.
New legal titles: penalty payments and decisions by professional bodies
Law 2021-1729 of 22 December 2021 extended the list of enforceable titles. It gave the force of judgment to decisions issued by certain professional bodies to recover unpaid dues, such as those issued by the Conseil national des barreaux against a defaulting lawyer. Similarly, decisions to pay a penalty ordered by the competent authority for each category of professional officer (commissaires de justice, notaires, etc.) now have the status of an enforceable title and can be used as a basis for compulsory enforcement measures, including seizure of property.
In-depth analysis of the debt's liquidity and payability conditions
Simply holding a writ of execution is not enough. Article L. 311-2 of the Code of Civil Enforcement Procedures requires that the claim it establishes must also be «liquid and due». These two concepts, although distinct, are closely linked and are the subject of abundant and subtle case law, the mastery of which is essential for contesting or securing a collection procedure.
The concept of a liquid claim: assessment and criteria used in case law
A claim is considered to be liquid when it is valued in money or when the writ of execution contains all the elements necessary for its valuation, as specified in article L. 111-6 of the Code. A judgment ordering the payment of a specific sum is the perfect example of a document evidencing a liquid claim. In the case of a notarised loan deed, the claim is liquid if the deed specifies the capital borrowed and the repayment terms, enabling the outstanding capital to be calculated at the date of the proceedings. A deed that merely sets a guarantee ceiling, without allowing the debt to be calculated precisely, does not establish a liquid debt and cannot form the basis of a seizure. The issue becomes more complex in the case of foreign currency loans. The Court of Cassation has accepted that the debt was liquid if its equivalent value in euros could be determined on the date of the summons to pay, the act that commits the debtor to enforcement.
Payability of the debt: acceleration, formal notice and reasonable deadlines
Payability is the right of the creditor to demand immediate payment of the debt. In the case of loans repayable by instalments, the outstanding capital only becomes payable in full once the loan has been accelerated. This sanction, which has serious consequences for the borrower, is strictly regulated. Unless there is a clause to the contrary, it must be preceded by a formal notice that has not been served. Case law carefully monitors the validity of this formal notice. It must be sent to the right address, and the simple fact that the debtor did not sign it personally or pick it up at the post office is not always enough to invalidate it. What's more, clauses providing for an almost automatic forfeiture of the term or for very short deadlines (eight days, for example) are increasingly being deemed unfair by the Court of Cassation, as they create a significant imbalance to the detriment of the consumer.
The impact of the statute of limitations: time limits, starting point and grounds for interruption/suspension
A claim, even if it is evidenced by a writ of execution, can be extinguished by the passage of time. One of the most complex aspects of exigibility is the impact of limitation periods for seizure of property, In the case of credit, the time limit varies according to the borrower's status. In the case of credit, the time limit varies depending on the borrower's status: two years for credit (including property credit) granted to a consumer (article L. 218-2 of the French Consumer Code), and five years for actions between traders or relating to professional loans (article L. 110-4 of the French Commercial Code). A major change in case law in 2016 unified the starting point for this period: for unpaid instalments, the limitation period runs from their respective due dates. In the case of outstanding capital, the limitation period only runs from the date on which the term expires, which is the only date on which the capital becomes payable in full. Finally, you should be aware that certain actions interrupt the statute of limitations and start a new period. Since 2008, a simple formal notice is no longer sufficient. Only legal action, enforcement action (such as a summons to pay equivalent to seizure) or acknowledgement of the debt by the debtor can effectively interrupt the limitation period.
Enforcement titles invalid for seizure of property: identifying the legal pitfalls
Some documents, although appearing to have authority, do not constitute enforceable titles valid for initiating a seizure of property. Identifying them is essential for the debtor's defence and to avoid proceedings that are doomed to failure. In addition to the invalidity of the title, there are a number of other grounds for seizure. other barriers to entry, These include the unseizability of certain assets. Case law has thus ruled out the possibility of compulsory execution on the basis of :
- Decisions to recognise liabilities in collective proceedings : a judgment that merely admits a claim to the liabilities of a receivership or compulsory liquidation does not contain an order to pay and cannot therefore form the basis of a seizure.
- Taxation of lawyers' fees : the Bâtonnier's decision setting the fees must be made enforceable by an order of the president of the court in order to allow compulsory enforcement.
- Decision to grant a legacy : a judgment ordering the delivery of a legacy of a sum of money is not a writ of execution allowing a seizure.
- Title for non-payment of a cheque : the deed issued by a judicial commissioner (formerly a bailiff) following a certificate of non-payment does allow for a seizure of property, but it does not constitute a court decision. As a result, the claim does not generate increased legal interest and does not allow the registration of a definitive judicial mortgage.
Incidents and challenges to the writ of execution in property seizure proceedings
The validity of the writ of execution may be challenged during the attachment procedure itself. Any dispute relating to the validity of an enforcement order during the seizure procedure falls under the jurisdiction of the courts. powers of the enforcement judge, who is responsible for ensuring that the procedure runs smoothly. These disputes must be raised, on pain of inadmissibility, at the latest at the orientation hearing by way of lawyer's submissions. They may relate to formal defects (absence of an executory clause, failure to give prior notice) or substantive defects (time-barred claim, unfair clause in the loan agreement). The penalty for an irregularity may be the invalidity of the summons to pay in the form of a seizure. In this case, the procedure is annulled and the deed loses all effect retroactively, including its effect in interrupting the statute of limitations, which can have decisive consequences for the debtor, and for a potential winning bidder if the sale has already taken place.
Impact of recent legislative reforms on enforceable titles in property seizures
The law governing the seizure of property and security interests is constantly evolving. Several recent reforms have altered the landscape of enforceable titles and enforcement conditions. Act 2019-222, for example, reformed the simultaneous seizure of several properties, placing the burden on the creditor to prove that the seizure of a single property is insufficient to satisfy the creditor. More fundamentally, Ordinance 2021-1192 reforming the law on securities, which came into force in 2022, modernised the system of guarantees and could have an impact on the validity of securities based on former securities. Lastly, the protection of sole traders has been strengthened, making their principal residence automatically exempt from seizure for business debts arising after 8 August 2015. This new system for separating business and personal assets makes it more difficult for creditors to take action, as they must now carefully identify the assets to which they are entitled.
The validity of a writ of execution is an absolute prerequisite for any seizure of property, a legal subject whose typology, substantive conditions and the disputes it may give rise to make it a complex area. This article is intended as an analytical tool, providing practical and strategic information. The assistance of a professional is essential to identify any weaknesses or to ensure the solidity of your plan. For an in-depth analysis of your situation and a strategy for defending against foreclosureIf you have any questions, please do not hesitate to contact us.
Sources
- Code of civil enforcement procedures (in particular articles L. 111-3, L. 311-2, L. 311-6)
- Civil Code (in particular articles 2224, 2240 et seq. on prescription)
- French Commercial Code (in particular articles L. 110-4, L. 526-1 et seq.)
- Consumer Code (in particular article L. 218-2)
- Law No. 2019-222 of 23 March 2019 on programming 2018-2022 and reform for the justice system
- Order no. 2021-1192 of 15 September 2021 reforming the law on securities
- Law no. 2021-1729 of 22 December 2021 on confidence in the judiciary
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