Collecting an unpaid debt from the State, a local authority or a public hospital is often wrongly perceived as an impossible task. While the principle of immunity from execution protects the assets of the government, the money it owes to a third party (your debtor) cannot escape seizure by creditors. However, the method for seizing these funds differs significantly from ordinary law and requires absolute procedural rigour. Our firm regularly finds that creditors have had their proceedings annulled for having neglected the rigorous formalities of public accounting or omitted a formal notice beforehand.
This article deciphers the specific mechanisms involved in the seizure of debts owed by a legal entity governed by public law. It incorporates recent developments relating to the status of the judicial commissioner, the liability of the manager In 2025, we'll be taking a closer look at the public sector and the key points to bear in mind to ensure the security of your procedures, whether you're dealing with an early situation or an ongoing dispute.
General Framework of Civil Enforcement Procedures and Specific Public Issues
Although recovery against the State is subject to strict rules, it is part of the general framework of civil enforcement procedures. The principle remains the same: a creditor in possession of a writ of execution can seize sums belonging to his debtor, even if they are held by a third party (the government). However, the public nature of the garnishee requires a change in the legal paradigm and an adaptation of the practice usual.
Fundamental principles of distraint
The seizure of public debts is largely based on seizure of assets mechanisms of ordinary law, with some notable exceptions. This procedure makes it possible to immediately allocate the sums seized to the creditor, up to the amount of the debt. L’effect is radical: from the meaning of the deed, the funds are frozen and legally transferred to the creditor, subject to the outcome of any disputes before the court. court or the competent judge.
The operation involves three players, creating a link triangular legal :
- Le distraining creditor who has an enforceable title.
- Le seized debtor, which is the administration's creditor (for example, a construction company awaiting payment of an invoice from a local council).
- Le garnishee, which in this case is the legal entity governed by public law (the State, the municipality, the public body).
Unlike a foreclosure for the sale of property, or for attachment of wages governed by the French Labour Code which requires calculating a seizable portion taking into account each dependant, administrative seizure blocks the monetary claim due.
Derogatory Rules Specific to Public Corporations
The major difference lies in the protection afforded to public bodies. Unlike private debtors, public entities benefit from principles of immunity from execution which prohibit the seizure of their own assets or bank accounts to pay their own debts. However, this immunity does not apply when the authorities are merely the «third party holder» of the funds of an individual or business. This is a notable exception in this domain.
The procedural difficulty stems from the strict separation between the authorising officers (those who decide on the expenditure, such as a mayor) and the public accountants (often staff from the Directorate General of Public Finances or a manager delegate). If an error is made when the document is served, the procedure will be null and void. The Code of Civil Enforcement Procedures therefore requires that the public accountant or the manager to whom the expenditure is assigned and not the administrative entity in general.
Data Entry Procedure and Central Role of the Public Accountant
The success of an entry on a public entity depends almost entirely on the quality of the document issued and the correct identification of the assigning accountant. The slightest error in the description of the debt, the addressee or the date may render the act ineffective.
The Seizure Deed: Mandatory Information and Procedural Requirements
All enforcement proceedings against a public authority require the possession of a valid enforcement order (e.g. a judgement or notarial deed). It is often useful to precede the seizure by a summons to pay, This is not always strictly required for a direct seizure of assets. Once title has been obtained, the judicial representative must draw up the seizure deed with surgical precision.
Unlike a conventional bank seizure, where all the debtor's accounts can be seized without knowing exactly what they are, seizure in the hands of a public accountant is subject to a strict derogation. L’article R. 143-2 of the Code of Civil Enforcement Procedures requires the deed to contain the following information, on pain of nullity designation of the seized claim. In practical terms, it is risky to be content with a generic formula. Ideally, the document should refer to the public contract, the invoice number or the administrative decision generating the debt that the administration owes to the debtor. This requirement is set out in the version of the text.
In addition, the writ of attachment must be served on the public accountant to whom the expenditure is assigned. Serving the document on the authorising officer or on a department that is not competent to do so constitutes a formal defect. The manager The public in charge of the file must be unambiguously identified.
The Public Accountant as garnishee: Obligations and deadlines
The public accountant is bound by the same garnishee's reporting obligations than any other banking establishment, failing which it will be liable to penalties. It must check the situation of the account and the existence of the debt. While ordinary law requires the bailiff to respond «immediately», the regulations allow the public accountant a period of reflection.
This period is twenty-four hours to provide the necessary information to the bailiff (amount of debt owed to the debtor, existence of assignments of claims, other seizures, etc.). notice to third parties holder). This period allows the accountant to check the monthly accounting statement and the availability of credit via its internal control. The public accountant must also endorse the original attachment document, a formality that certifies that the measure has been properly received and entered in the public accounts.
Notification of the seizure to the Public Debtor and time limits for contesting the seizure
Once the seizure has been placed in the hands of the accountant, the creditor must inform the debtor. This step, known as denunciation, must be carried out within a strict period of eight days from notification to the third party, failing which the seizure lapses. The debtor then has one month to contest the measure before the enforcement judge of the judicial court, often via the court registry competent.
If no dispute is lodged within one month of the denunciation, the creditor shall request a certificate of no dispute from the transplant or the court commissioner. Upon presentation of this document, the public accountant or the manager is required to pay the sums seized. It should be noted that payment by the administration can only be made after the expenditure has been authorised, which can sometimes create a technical delay despite the immediate effect of the seizure, depending on the practice of the case concerned.
Recent Reforms and Future Challenges of Seizure of Public Entities
The enforcement landscape has undergone profound changes in recent years, notably with the creation of the profession of judicial commissioner, the evolution of the budget management and the modernisation of public finances initiated by the Minister for the Budget. These developments have a direct impact on the strategy of creditors and the’work recovery.
Impact of Post-2021 Legislative Reforms on Enforcement Procedures
Recent reforms have strengthened the role of the judicial commissioner in the implementation of proceedings against legal entities governed by public law. Since 1st July By 2022, this new profession will have a monopoly on enforcement. This will make it easier for creditors to identify the right person to contact, particularly for the notification to public accountants.
In addition, the Order of 23 March 2022 reformed the liability regime for public managers, which came into force on 23 March 2022. January 1st 2023. Although the personal and pecuniary liability of public accountants has evolved towards a unified system of managerial liability, the obligation to comply with seizures duly served remains a fundamental requirement for any public accountant. manager. If a public accountant fails to comply with an attachment order, the administration is always liable, and potentially the debtor as well. manager before the Court of Auditors in the event of serious misconduct.
For 2025 and beyond, the focus is on increasing diversion from the courts. A major reform of the seizure of remuneration is planned for July 2025. Although the data entered by public accountants remains distinct, the general trend towards automation and administrative simplification could, in time, influence collection practices. Each new code and each decree particularly those published at the end of the year.’year, often around the 31 December.
Relationship with Tax Debt Recovery and Strategies for Private Creditors
It is crucial to distinguish between seizure of assets (a tool used by private creditors) and seizure by third parties (Saisie Administrative à Tiers Détenteur - SATD), which is the preferred tool used by the tax authorities to recover their own debts (taxes, fines). In the practice, A conflict may arise if the debtor owes money to both a private creditor and the Treasury.
The tax authorities often have priority. If a third-party notice is served on the public accountant before or on the same day as a private creditor's attachment, the Treasury will generally have priority for payment. The strategy for private creditors is therefore to act extremely quickly as soon as they obtain the writ of execution and the collection. You should not wait for the debtor's financial situation to deteriorate to the point where tax and social security debts absorb all the money available. It is sometimes necessary to check the situation under corporation tax or VAT.
Faced with the complexity of public accounting rules, the need to designate the debt precisely (in compliance with the’annex III of the General Tax Code where applicable for certain related tax procedures) and the risks of invalidity, the assistance of a professional (lawyer or commissaire de justice) is highly recommended. If you are experiencing difficulties in enforcing a court order against a public authority, our firm can provide you with the following services advice to analyse your case and secure your application.
Sources
- Code of civil enforcement procedures : Article L. 211-1 et seq. (current version relating to attachment for payment).
- Code of civil enforcement procedures : Article R. 143-1 to R. 143-4 and R. 211-4 (current version relating to seizures from public accountants).
- Order no. 2016-728 of 2 June 2016 on the status of commissaire de justice (consolidated version).
- Order no. 2022-408 of 23 March 2022 on the financial liability of public managers (version applicable since January 1st 2023).
- Decree no. 2012-1246 of 7 November 2012 on public budget and accounting management (GBCP), particularly in its version modified.
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