You are consulting a text devoted to a practical, exhaustive and chronological presentation of the property seizure procedure, intended for a public of legal professionals. Doctrinal controversies will not be discussed unless they are of practical interest. Nor will we discuss judicial sale procedures in the context of judicial liquidation or licitation-partage.
Last updated on 14 September 2023.
Foreclosure in brief:
The seizure of property procedure was reformed by order no. 2006-461 of 21 April 2006 and its implementing decree no. 2006-936 of 27 July 2006, amended by decrees no. 2006-805 of 23 December 2006 and no. 2009-160 of 12 February 2009.
Articles 1 to 42 of law no. 91-650 of 9 July 1991 reforming civil enforcement procedures and articles 1 to 54 of its implementing decree no. 92-755 of 31 July 1992 are applicable to the seizure of property, unless otherwise provided.
The Code of Civil Enforcement Procedure, which has been in force since 1 January 2007, provides for the following conditionse June 2012, incorporates almost all of the content of the aforementioned decrees in articles L. 311-1 to L. 341-1 and R. 311-1 to R. 334-4.
Circular 03-09 C3 of 20 March 2009 on the presentation of the provisions relating to the seizure of real estate, the distribution of the price of real estate and the sale of the real estate of a person who is the subject of collective proceedings, issued by Order 2008-1345 of 18 December 2008 and Decree 2009-160 of 12 February 2009, is a useful guide for court registrars.
In addition, article 12 of the National Rules of Procedure of the legal profession deals with the ethics and practice of lawyers in judicial sales. In particular, article 12.1 requires lawyers to use the standard clauses appended to the regulations, which set out the general provisions applicable to judicial sales involving the seizure of property, licitations and judicial liquidation.
Until recently, the general provisions of the terms and conditions of sale had no normative value. Indeed, despite the provisions of article 38-1 of decree no. 91-1197 of 27 November 1991 organising the legal profession, the Conseil national des barreaux had failed to notify the Minister of Justice of the decision attaching the standard general provisions to be used in judicial sales, thereby preventing their publication in the Journal officiel.
The Court of Cassation had therefore found that they had no normative value and, consequently, such that their breach could not give rise to cassation (Cass. civ., 2e, 25 Sept. 2014, no. 13-15.597).
This omission was corrected when the Decision of 13 February 2019 reforming the CNB's national rules of procedure for the legal profession was published in the Official Journal on 7 March 2019.
Traditionally, enforcement proceedings, which are between a creditor and a debtor and not between a claimant and a defendant, are not proceedings and therefore cannot be subject to the sanction of the lapse of proceedings (Cass. civ., 2e, 24 March 2005, no. 03-16.312, published in the Bulletin).
However, the terminology used by the Cour de cassation is confusing, as it regularly uses the expression "instance" in matters of seizure of property, see for example in matters of interruption of payment prescription : "And whereas, having recalled that, under article 2242 of the Civil Code, the interruption of the limitation period resulting from the application to the court produced its effects until the proceedings were extinguished, the Court of Appeal, which correctly held that the proceedings initiated by the referral to the enforcement judge that gave rise to the referral judgment of 17 December 2009 had only been extinguished by the order of 31 October 2012 approving the proposed distribution of the sale price of the property, correctly deduced that the action for attachment of wages initiated on 24 October 2013 was admissible; " (Cass. civ., 2e, 6 Sept. 2018, no. 17-21.337, published in the Bulletin).
Moreover, under the old text, it had been held that incidents of proceedings could give rise to a lapse of time (Cass. civ., 2e, 6 févr. 1991, n° 89-21.371, published in the Bulletin).
If the creditor withdraws, the execution judge loses jurisdiction and no longer has the power to rule on disputes arising from the seizure of property proceedings or to rule on counterclaims arising from or relating to these proceedings (Cass. civ., 2e, 11 Jan. 2018, no. 16-22.829, published in the Bulletin).
In this case, the debtor had accepted the bank's withdrawal from the proceedings, but maintained its counterclaims, arguing that the withdrawal was only perfect if accepted by the defendant (article 395 of the Code of Civil Procedure).
The Court of Cassation did not follow his reasoning, enshrining the rule that the disappearance of the enforcement remedy as a result of the claimant's withdrawal means that the court does not have jurisdiction to hear counterclaims.
The jurisdiction of the enforcement judge results from the third paragraph of Article L. 213-6 of the Code of Judicial Organisation: "The enforcement judge has jurisdiction, subject to the same proviso, over the seizure of property procedure, disputes arising in connection therewith and claims arising from or directly related to this procedure, even if they concern the substance of the law, as well as the distribution procedure arising therefrom.
The duties of the enforcement judge are performed by the president of the judicial court, subject to delegation (article L. 213-5 of the Code of Judicial Organisation).
The body of a sentence "disputes arising in the course of such proceedings and claims arising therefrom or directly related thereto, even if they concern the substance of the law". allows the enforcement judge to purge difficulties relating to the enforcement of notarial deeds. The fact that a notarial deed can be enforced without first being referred to a judge on the merits means that all disputes relating to its validity remain admissible before the enforcement judge.
The question submitted to the enforcement judge must nevertheless arise during the forced execution, failing which it will fall within the jurisdiction of the court hearing the case on the merits. For example, it has been held that a claim for an order that the creditor pay damages does not fall within the jurisdiction of the enforcement judge because it does not constitute a challenge to the seizure of the property (Cass. civ., 2nd, 25 Sept. 2014, no. 13-20.561, published in the Bulletin; Cass. civ., 2nd, 22 June 2017, no. 15-24.385).
Lastly, the enforcement judge has jurisdiction from the date of issue of the summons to pay for the seizure of property, i.e. well before the case is registered when the summons to attend the orientation hearing is filed with the clerk of the auction registry.
The first paragraph of Article R. 321-1 of the Code of Civil Enforcement Procedures states that "Pursuant to Article L. 321-1, enforcement proceedings are initiated by serving a summons to pay on the debtor or the third party holder at the request of the pursuing creditor.
The territorial jurisdiction of the enforcement judge is governed by articles R. 311-2 and R. 311-3 of the Code of Civil Enforcement Procedures.
Article R. 311-2 states that "The seizure of the property is pursued before the enforcement judge of the court within whose jurisdiction the seized property is located.
Article R. 311-3 states that "Where a creditor has simultaneously seized several properties belonging to the same debtor located in the jurisdictions of several judicial courts, the proceedings shall be brought before the enforcement judge of the court in whose jurisdiction the seized property where the debtor lives is located, failing which, before the judge of the jurisdiction in which any of the properties is located.
If there is more than one property, the creditor must first bring proceedings before the court for the place where the debtor is domiciled. If there is no correspondence between the property and the debtor's domicile, the creditor may bring proceedings before the court of his choice.
Article R. 212-17 of the Code of Judicial Organisation states that the registry of the enforcement judge is the registry of the judicial court.
In practice, the registry of the enforcement judge is particularly accessible. The text provides for the lawyer to carry out a number of tasks there, and for bidders to be able to consult the terms and conditions of the sale.
Article R. 311-4 of the Code of Civil Enforcement Procedures states that "Unless otherwise stipulated, the parties are obliged to constitute a lawyer.
The contrary provision referred to results, in particular, from the provisions of article R. 322-17 of the same code: "The debtor's request for authorisation of the amicable sale of the property, as well as the acts subsequent to this sale, do not require the assistance of a lawyer. This request may be made orally at the orientation hearing.
There is no multi-postulation in property seizures.
The law Macron no. 2015-990 of 6 August 2015 introducing multi-postulation made an exception for proceedings for the seizure of property, partition and licitation, for which "lawyers may not appear before a court other than the one in which they have their professional residence". (article 5, paragraph 2 of law no. 71-1130 of 31 December 1971).
Most of the procedural documents will be published in the real estate register kept by the land registry. As a result, they must comply with the requirements of decrees no. 55-22 of 4 January 1955 and no. 55-1350 of 14 October 1955 relating to the identification of legal entities, natural persons and buildings.
Article 5, paragraph 1, of Decree no. 55-22 of 4 January 1955 states that "Any deed or court decision subject to publication in a land registry office must contain the surnames, first names in civil status order, domicile, date and place of birth and occupation of the parties, as well as the name of their spouse.
The surname, forenames in civil status order, date and place of birth and name of the spouse appear on the birth certificate. The profession, meanwhile, will certainly be mentioned in the last deed published in the property register.
Article 6 of Decree no. 55-22 of 4 January 1955 states that "1 Any deed or judicial decision submitted for publication to a land registry must contain the following information identifying legal entities:
In addition, the full name and address of the representative(s) of the legal entity must be given.
The full name and address of the representative(s) of the legal entity appear on the Kbis extract.
The date and place of the declaration or filing of the articles of association of associations and trade unions can be consulted in the Journal officiel des associations et fondations d'entreprises (JOAFE).
The identification of buildings is not based solely on their description, but also requires a reference to their relative effect and to the descriptive statement of division and any amendments.
Paragraphs 1 and 3 of Article 7 of Decree no. 55-22 of 4 January 1955 state that "Any deed or court decision subject to publication in a land registry must indicate, for each of the properties it concerns, the nature, location, surface area and cadastral designation (section, map number and locality). The locality is replaced by an indication of the street and number for properties located in the built-up areas of urban municipalities.
[...]
Where a division of the ownership of the land involving a change of boundary is not carried out or recorded, but only concerns one or more fractions of an immovable, the deed or court decision must include both the description of the said fractions and that of the immovable as a whole. The fraction must be designated in accordance with a descriptive statement of division or, where applicable, an amending statement, drawn up in accordance with the conditions laid down by decree and published in advance; it must mention the number of the lot in which the fraction is included and, subject to the exceptions provided for in the said decree, the share in the ownership of the land relating to that lot. The provisions of this paragraph do not apply when the deed or decision concerns an easement, a right of use or habitation, or a lease of more than twelve years. They also do not apply where the deed or decision results in the division of the building being abolished.
The seized property must therefore be identified, with the following details:
If the property being seized is a co-ownership lot, the above details must be added:
But also, under its cadastral designation :
Caution! Article 7 makes no mention of the volume division lot, even though this is a requirement for identifying the building, in the same way as the co-ownership lot.
The volumetric division lot is used to distinguish between several vertically interlocking housing units where there are no common parts.
Article 1 of Law no. 65-557 of 10 July 1965 establishing the status of co-ownership of built-up properties defines co-ownership in terms of the division of ownership (paragraph 1) and common areas (paragraph 2): "This Act governs any built property or group of built properties, the ownership of which is divided into lots among several persons.
A co-ownership lot must include a private portion and a share of the common portions, which are inseparable.
In some cases, however, two buildings are vertically interlocked without any common parts, for example when a cellar extends under the neighbouring property. Any common floor will not constitute a common area and may be dealt with under the joint ownership system (for its upkeep) and the volume division system (for its identification).
The deed recording a transfer of ownership must mention the relative effect, i.e. the deed by which the distrainee debtor became the owner of the seized property (sale, gift, devolution, etc.), with its publication references, in accordance with article 32 of decree no. 55-1350 of 14 October 1955 : "1 Subject to the provisions of article 35 below, no publicity formalities may be carried out in the real estate register in the absence of prior or simultaneous publicity of the deed, court decision or certificate of transmission by death establishing the right of the disposing person or last holder.
The disposing party or last holder, within the meaning of Article 3 of the Decree of 4 January 1955 and of this section, means the person whose right is transferred, modified, confirmed, encumbered or extinguished - or is likely to be - with or without consent by the formality whose publication is required.
If the title or certificate has not yet been published, the document filed must specify that publication will be required at the same time.
Failure to mention the relative effect will result in the rejection of the publication of the deed in accordance with article 33 of the same decree.
The act that "was not drawn up or delivered with the assistance or at the request of the last holder of the right and, in particular, in the event of seizure, legal claim, [...]". (article 36 1. of the same decree) does not have to mention the relative effect. This means that the summons to pay equivalent to a seizure, the summons to the orientation hearing and the notice to registered creditors do not have to mention the relative effect, but that it must be mentioned in the conditions of sale.
The conditions of sale will become the title deed once the registry has attached the receipt for payment of the taxed costs, the auction judgement and the executory clause (article R. 322-61 of the Code of Civil Enforcement Procedures). However, the relative effect will not be mentioned in the auction judgement, the content of which is precisely defined in article R. 322-59 of the Code of Civil Enforcement Procedures. It is therefore up to the lawyer, when preparing the future title deed, i.e. when drafting the conditions of sale, to incorporate this reference into the deed.
Article 7, paragraph 3, of Decree no. 55-22 of 4 January 1955 states that "When, without effecting or recording a division of the ownership of the land resulting in a change of boundary, it only concerns one or more fractions of an immovable, the deed or court decision must include both the designation of the said fractions and that of the immovable as a whole. The fraction must be designated in accordance with a descriptive statement of division, or, where applicable, an amending statement, drawn up in accordance with the conditions laid down by decree, and published in advance; it must mention the number of the lot in which the fraction is included, and, subject to the exceptions provided for in the said decree, the share in the ownership of the land relating to that lot. The provisions of this paragraph do not apply when the deed or decision concerns an easement, a right of use or habitation, or a lease of more than twelve years. They also do not apply where the deed or decision results in the division of the building being abolished.
The deed concerning a co-ownership lot must mention the descriptive statement of division and any amendments, as well as their publication references. The relative effect describes the building but does not describe its evolution over time, which is the result of any changes made to the descriptive statement of division. Mention of the descriptive statement of division and any amendments will therefore make it possible to describe the life of the property after the transfer of ownership.
This is the typical example of a co-owner who has taken over the attic of a building, with the consent of his neighbours. The état descriptif de division will be updated to reflect the size of his co-ownership lot and the related tantièmes, in order to increase his share of the common areas. The description of the co-ownership lot in the deed of sale will then become obsolete, which is why subsequent deeds transferring ownership will necessarily refer to the descriptive statement of division and its amendments.
When a deed is required to be published in the property register, the land registry checks that it complies with the requirements set out in articles 5, 6 and 7 of decree no. 55-22 of 4 January 1955.
However, the scope of the checks carried out by the land registry was limited by the legislator in Act 98-261 of 6 April 1998 reforming accounting regulations and adapting the land registry system and its implementing decree 98-553 of 3 July 1998.
On this occasion, the legislator amended the provisions of Article 34 of the Decree of 4 January 1955 relating to the grounds for rejection, to stipulate in 1. a) that : " 1. When he has accepted the deposit and entered the formality in the register provided for in Article 2200 of the Civil Code, the Registrar :
- checks the accuracy of the references to the previous formality ;
- ensures that the document filed is consistent with documents published since 1 January 1956, as listed in the property register, with regard to :
Article 42-1, to which reference is made, provides that "For the application of the provisions of the sixth paragraph of article 2148 of the Civil Code and of b of 3 of article 34 of the present decree, the concordance check of the identification elements of the legal entities referred to in c of 1 of article 6 of the present decree will be limited to the name and the identity number as from the second formality completed after 1st July 1998.
As a result, it will be compulsory for documents relating to the seizure of property to include the following information to identify natural persons: their surname, their first two given names and the date and place of their birth.
For legal entities, since the second formality completed after 1e July 1998, the "RCS and the town of registration are no longer compulsory for the land registry, although they will continue to be included in documents under the provisions of the Code of Civil Procedure, in particular article 54.
Finally, in practice, the land registry does not penalise the failure to mention the legal representative(s) of the legal entity.
The prerequisites for the procedure are defined in articles L. 311-1 to L. 311-8 of the Code of Civil Enforcement Procedures. You must :
Any natural person or legal entity may initiate proceedings for the seizure of property, provided that they have the capacity to take legal action. Article L. 111-7 of the Code of Civil Enforcement Procedures provides that "The creditor has a choice of measures to ensure the performance or preservation of his claim. The execution of these measures may not exceed what is necessary to obtain payment of the obligation.
The syndicate of co-owners may initiate a property seizure procedure, but the syndic must act on the basis of a resolution of the general meeting of co-owners authorising him to proceed with the sale by public auction of a sales lot consisting of one or more co-ownership lots, and setting the amount of the bid for the said sales lot(s). The lack of authorisation for the syndic constitutes an objection within the meaning of article 122 of the Code of Civil Procedure. It can therefore be rectified during the course of the proceedings.
However, the creditor, whether a natural person, a legal entity or a syndicate of co-owners, is subject to two limits, resulting from the provisions of article L. 311-5 of the Code of Civil Enforcement Procedures: "A creditor who has seized one of his debtor's properties may only initiate a new seizure on another of his debtor's properties if the property already seized is insufficient.
The creditor may only seize immovable property that is not mortgaged in his favour if the mortgage from which he benefits does not allow him to enforce his rights.
In order to identify the debtor as a natural person in accordance with the provisions of article 54 of the Code of Civil Procedure and articles 5 and 34 of the Decree of 4 January 1955, the first two forenames, surname, date and place of birth, address and profession must be given in the deeds published in the property register.
The lawyer will also consult the debtor's birth certificate to find out about his marital status and, where applicable, his matrimonial regime.
Article L. 311-7 of the Code of Civil Enforcement Procedures provides that "Seizure of joint property shall be pursued against both spouses.
Article R. 321-1, paragraph 3, of the Code of Civil Enforcement Procedures adds that "Where a property owned by one of the spouses constitutes the family residence, the summons shall be served on the other spouse no later than the first working day following service of the document.
Marital status is noted in the margin of the birth certificate, which includes details of marriages, divorces and deaths.
In practice, the registry office responsible for marriages informs the other registry offices, which then make a note of the marriage in the margin of the birth certificate. Sometimes an error is made at the marginal mention stage, for example if the department fails to process the request for mention. In such cases, there may be a discrepancy between the entries on the marriage certificate and those on the birth certificate.
For example, it is possible for marriage or divorce to appear in the margin of the husband's birth certificate, but not that of the wife.
It is therefore advisable to systematically order not only the spouses' birth certificates, but also their marriage certificates, even if their birth certificates match and both mention marriage.
If you are dealing with foreign nationals, you should always ask :
Finally, it will be necessary to consult the BODACC to check that no collective proceedings have been opened against the seized debtor.
The Kbis extract includes all the information required to identify a legal entity in accordance with the requirements of article 6 of the decree of 4 January 1955.
In addition, the BODACC should be consulted to check that the seized debtor is not subject to a collective commencement order. It should be remembered that the opening judgment halts or prohibits all enforcement proceedings, in accordance with the provisions of article L. 622-21 of the French Commercial Code: "II - Without prejudice to the rights of creditors whose claims are referred to in I of Article L. 622-17, the opening judgement shall halt or prohibit all enforcement proceedings against both movable and immovable property and all distribution proceedings that did not have an attributive effect prior to the opening judgement.
Craftspeople are registered with the Chamber of Trades. The Chambers of Trades are independent of each other and do not all operate in the same way. Not all chambers allow you to order a status notice electronically, and processing times for postal requests vary widely.
Associations with legal personality (the only ones that can own a building) are registered in the Journal officiel des associations et fondations d'entreprises (JOAFE). The JOAFE can be consulted for all identification details, including the date and place of declaration or filing of the articles of association. The articles of association can be ordered from the Préfecture.
In accordance with article L. 722-2 of the French Consumer Code, a decision by the Commission de surendettement des particuliers (Private Individuals' Over-indebtedness Commission) to accept a case of over-indebtedness automatically halts any ongoing enforcement proceedings and prohibits any new proceedings: "The admissibility of the application suspends and prohibits enforcement proceedings against the debtor's assets and assignments of remuneration granted by the debtor in respect of debts other than maintenance debts.
The suspension of enforcement proceedings does not call into question the effects of the summons to pay for the seizure of the property. However, the benefits accruing after the admissibility decision become available again.
Furthermore, if the admissibility decision is subsequent to the referral judgment ordering the compulsory sale of the property, the postponement of the auction hearing is not automatic. Articles L. 722-4 and L. 722-7 of the Consumer Code state the same thing, namely that "In the case of a property seizure, when a compulsory sale has been ordered, the auction date may only be postponed by a decision of the judge responsible for the property seizure, referred to this end by the commission, for serious and duly justified reasons.
The text of the two articles is exactly the same, but the first is entitled Referral to the commission de surendettement des particuliers (private individuals' over-indebtedness commission) while the second is under the title Effects of the admissibility decision. In other words, the Commission de surendettement can refer the matter to the judge at any time after the overindebtedness file has been submitted, to request a postponement of the adjudication hearing.
Article R. 322-28 of the Code of Civil Enforcement Procedures corroborates: "The compulsory sale may only be postponed in the event of force majeure or at the request of the Commission de surendettement (excessive debt commission), in accordance with articles L. 722-4 or L. 721-7 of the Code de la consommation.
Should the Commission de surendettement request a postponement of the auction hearing, compliance with the applicable procedure, described in article R. 721-7 of the French Consumer Code, should be verified: "In the event of a property seizure, where the compulsory sale of a debtor's property has been ordered and the commission refers the matter to the judge responsible for the property seizure with a view to postponing the auction date pursuant to the provisions of article L. 721-7 or those of article L. 722-4, it shall send the request by registered letter with acknowledgement of receipt or by hand-delivery with acknowledgement of receipt to the court registry, at least fifteen days before the scheduled date of the sale.
This application shall state the full name and address of the debtor and those of the pursuing creditors or, in the case of legal entities, their name and registered office. It shall specify the serious and duly substantiated reasons given in support of the application. The application must be accompanied by a statement of the debtor's income, a list of the assets and liabilities of the debtor's estate and a list of any enforcement proceedings taken against the debtor's property, any transfers of earnings that the debtor has agreed to and any measures to evict the debtor from his home, drawn up using the documents available to the commission.
The opening of insolvency proceedings halts or prohibits all means of execution on both movable and immovable property, in accordance with article L. 622-21 of the French Commercial Code : "I.-The opening judgment suspends or prohibits any legal action by all creditors whose claim is not mentioned in I of article L. 622-17 and who wish to :
1° Ordering the debtor to pay a sum of money;
2° The cancellation of a contract for non-payment of a sum of money.
II - It shall also halt or prohibit any enforcement proceedings on the part of such creditors, whether in respect of movable or immovable property, and any distribution proceedings that did not have an attributive effect prior to the opening judgment.
III - The time limits for forfeiture or cancellation of rights are consequently interrupted.
If the property seizure procedure is initiated at the time of publication in the BODACC of a ruling opening collective proceedings, the procedure is immediately interrupted. It is therefore necessary to register an alert to be automatically informed of publications relating to the company being sued.
There are two possibilities for prosecution:
The immovable property of minors and adults under guardianship or trusteeship may be seized, subject to prior discussion of their movable property, in accordance with the provisions of article L. 311-8 of the Code of Civil Enforcement Procedures : "The immovable property of a minor, even an emancipated minor, or of an adult under guardianship or tutorship, may not be seized before their movable property has been discussed.
However, discussion of movable property is not required prior to the seizure of undivided immovable property between an adult and a minor or an adult under guardianship or tutorship, if the debt is common to them. Nor is it required if the proceedings began before the adult was placed under guardianship.
The pursuing creditor will have to summon the tutor or the incapable person under curatorship and his curator to declare which movable assets are likely to be discussed before initiating a seizure of property procedure.
If the debtor dies, proceedings may be brought against his heirs simply by applying the provisions of Article 877 of the Civil Code: "A writ of execution against the deceased is also enforceable against the heir eight days after it has been served on him.
If the heir has not taken a position in relation to the succession, by accepting it, accepting it up to the net assets, or renouncing it, then the creditor may summon him to opt within 4 months of the opening of the succession, by extrajudicial act: "The heir may not be forced to opt before the expiry of a period of four months from the opening of the succession.
On expiry of this period, he may be summoned, by extrajudicial act, to take sides on the initiative of a creditor of the succession, a co-heir, an heir of subsequent rank or the State". (article 771 of the Civil Code).
From the date of receipt of the summons to opt, the heir must make his choice or, failing that, request a further period, failing which he will be deemed to have accepted the option pure and simple on expiry of a period of 2 months: "Within two months of the summons, the heir must take sides or request an extension from the judge if he has not been able to complete the inventory that has been started or if he has other serious and legitimate reasons. This period is suspended from the date of the request for an extension until the decision of the court.
If the heir has not taken a decision by the end of the two-month period or the additional period allowed, he shall be deemed to have accepted outright. (article 772 of the Civil Code).
When the debtor dies and has no known or accepting heirs, the estate is vacant within the meaning of article 809 of the Civil Code: "The estate is vacant:
1° Where there is no one to claim the succession and there is no known heir ;
2° When all known heirs have renounced the succession;
3° If, after the expiry of a period of six months from the opening of the succession, the known heirs have not opted, either tacitly or expressly".
The pursuing creditor must then request the appointment of the Administration des domaines as curator of the vacant estate, by means of a petition to the President of the judicial court (articles 809-1 et seq. of the Civil Code).
The Administration de Domaines will settle the estate's liabilities in accordance with articles 810 et seq. of the Civil Code.
Article L. 111-3 of the Code of Civil Enforcement Procedures lists the enforceable titles: "Only the following constitute enforceable titles:
1° Judicial or administrative decisions when they are enforceable, as well as agreements to which these courts have granted enforceability;
2° Foreign deeds and judgments and arbitration awards declared enforceable by a decision that is not subject to an appeal suspending enforcement, without prejudice to the provisions of European Union law applicable ;
3° Extracts from conciliation reports signed by the judge and the parties;
4° Notarial deeds bearing the executory clause;
4° bis Agreements by which the spouses mutually consent to their divorce by private deed countersigned by lawyers, filed with a notary in accordance with the procedures set out in Article 229-1 of the Civil Code;
5° The document issued by the bailiff in the event of non-payment of a cheque or in the event of an agreement between the creditor and the debtor under the conditions set out in Article L. 125-1 ;
6° Certificates issued by legal entities governed by public law, qualified as such by law, or decisions to which the law attaches the effects of a judgment.
The first paragraph of Article L. 311-4 of the Code of Civil Enforcement Procedures states that the proceedings may be initiated by virtue of a decision that is provisionally enforceable, but that the forced sale may only take place after a final decision that has become res judicata : "Where proceedings are instituted by virtue of a provisionally enforceable court decision, the compulsory sale may only take place after a final decision has become res judicata.
As a result, the summary order allows the proceedings to be initiated as a precautionary measure, but does not allow the judge to order a forced sale. An out-of-court sale, on the other hand, may be ordered if requested by the seized debtor.
Again by virtue of the first paragraph of article L. 311-4 of the Code of Civil Enforcement Procedures (cited above), a provisionally enforceable judgment allows proceedings to be initiated, but does not allow the court to order a forced sale.
In order for the compulsory sale to be ordered, the appeals process must be completed for the decision to become res judicata. This means that the certificate of non-appeal or non-referral of the decision for which recovery is sought must be produced as part of the proceedings.
Lastly, no proceedings may be brought in respect of a decision rendered in absentia until the objection period has been served, pursuant to the second paragraph of article L. 311-4 : "However, during the opposition period, no proceedings may be instituted by virtue of a default judgment.
Article L. 311-2 of the French Code of Civil Enforcement Procedures states that an enforcement order must state that the debt is liquid and due. The liquid and due nature of the claim does not raise any difficulties for court decisions ordering the debtor to pay a sum of money.
On the other hand, where the deed for which recovery is sought is an authentic instrument, it will not determine the amount of the claim in advance, but will contain all the information needed to assess it, in accordance with the provisions of article L. 111-6 of the Code of Civil Enforcement Procedures: "A claim is liquid when it is valued in money or when the security contains all the elements required for its valuation.
The most common case, of course, concerns banks. For example, a bank that pursues the recovery of a property loan liquidates the debt at the time of acceleration, which also makes the outstanding capital due. Any faults committed by the bank could validly be submitted to the enforcement judge, since we are dealing with an enforceable title, but also with difficulties relating to its enforcement that have not been resolved by a judgment on the merits.
This is also why the bank will have to submit to the debates the letter of acceleration (Civ. 1e, 15 June 2016, no. 15-16.173), by which it declared the outstanding capital due and payable. It should also be noted that the Court of Cassation has repeated on several occasions that the forfeiture of the term must(Civ. 1e, 3 June 2015, no. 14-15.655, Cass. 1re civ., 11 Jan. 2023, no. 21-21.590, published in the Bulletin).
Article L. 311-6 of the French Code of Civil Enforcement Procedures states that "Unless there are specific legislative provisions, the seizure of property may relate to all rights in rem in respect of immovable property, including accessories deemed to be immovable property, which may be the subject of an assignment.
Article L. 321-3 adds that "The act of seizure of an immovable shall entail seizure of its fruits, except for the effect of an earlier seizure.
Article R. 321-3 of the French Code of Civil Enforcement Procedures, which sets out the compulsory information to be included in the summons to pay for the seizure of property, states that the summons must include : "5° The description of each of the assets or rights to which the seizure relates, as required by the rules governing land registration;".
The requirements for land registration have been discussed at length above and are, for the record, set out in paragraphs 1 and 3 of article 7 of decree no. 55-22 of 4 January 1955. Identification of the property results from :
Caution! Article 7, when detailing the cadastral designation, makes no mention of the volume number, even though this is an essential part of the identification of the property where it exists.
All of this information will be included in the title deed (deed of sale, gift, etc.), although it should be noted that the cadastral designation given in the title deed may be incorrect.
Cadastral references may change, for example when a parcel is divided up or the land register is revised. These changes will be indicated on the property record, which must be ordered from the property register. In the event of difficulty, it will also be possible to order the deed that caused the change to the cadastral references (e.g. survey document, cadastral reorganisation report, etc.).
In addition, the cadastral references are set out in cadastral extract no. 1, which we strongly recommend you have on file for publication of the proceedings, along with the cadastral matrix, which confirms the said references, the identity of the owner and the amount of property tax.
All the information relating to buildings also applies to co-ownership lots, which are created and identified by the descriptive statement of division and identified by the title deeds.
The descriptive statement of division divides the co-ownership into lots, which it describes and for which it determines the tantièmes, while the title deeds indicate to whom the lots belong.
The deeds must describe the co-ownership lot and identify it by lot number and tantièmes.
Caution! The division of a property may change over time. Where necessary, an amendment to the descriptive statement of division may be published in the property register. This amendment may be made after the sale of the lot, so that the title deeds describe the structure of the building at the time of the transfer of ownership, but this structure may change over time. In other words, the title deeds represent a snapshot in time of the building, while reading the building description together with any amendments to the descriptive statement of division provides an insight into its life and development.
The body of a sentence "Unless otherwise provided by law refers to the provisions relating to immovable property that cannot be seized by operation of law.
There are a number of possible scenarios (e.g. buildings required by professional trade unions for their meetings, etc.), but the most common scenario concerns the declaration of unseizability under Article L. 526-1 of the French Commercial Code: "By way of derogation from articles 2284 and 2285 of the Civil Code, a natural person who is registered in a legal register for professional purposes or who engages in an agricultural or self-employed professional activity may declare that his or her rights to the building in which his or her principal residence is located and to any built or unbuilt property that he or she has not used for professional purposes are exempt from seizure. This declaration, published in the real estate register or, in the departments of Bas-Rhin, Haut-Rhin and Moselle, in the land register, has effect only with regard to creditors whose rights arise, subsequent to publication, in connection with the declarant's professional activity.
Where the entire property is not used for business purposes, the part not used for business purposes may only be declared if it is designated in a descriptive statement of division. The fact that the declarant is domiciled in his residential premises in application of article L. 123-10 does not prevent this premises from being the subject of the declaration, without the need for a descriptive statement of division".
Publication of the declaration of unseizability in the property register means that it will be enforceable against mortgagees registered after its publication. However, if the proceedings are initiated by a creditor who was registered before the declaration of unseizability was published, they will be able to validly declare their claim to the proceedings and will be paid when the funds are distributed.
To prepare the file, the pursuing creditor will need to collect a series of documents relating to the parties, the enforcement order and the property. Summary :
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WHAT |
WHY |
HOW |
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1. The pursuing creditor 1.1. The natural person |
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Birth certificate |
Identity is certified on the basis of an extract less than 3 months old. |
Town hall of place of birth (including abroad), consulate, embassy |
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1.2. The legal entity |
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Kbis extract |
Identity is certified on the basis of an extract less than 3 months old. |
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By-laws |
Verification that the articles of association allow proceedings to be commenced and a property to be included in the company's assets and liabilities |
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1.3. The syndicate of co-owners |
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Minutes of the general meeting authorising the proceedings, determining the number of lots to be sold and setting the hammer price |
Checking the trustee's standing |
Customer |
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2. The seized debtor 2.1. The natural person |
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Birth certificate |
Identification of surnames and forenames, checking of marginal information |
Town hall of place of birth (including abroad), consulate, embassy |
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Marriage certificate |
Checking marital status and matrimonial property regime |
Town hall of the place of marriage (including abroad), consulate, embassy |
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Death certificate |
Controlling the transfer of de cujus |
Town hall of place of death (including abroad), consulate, embassy |
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Title deed (deed of sale, gift, etc.) |
Checking the debtor's occupation and address |
CERFA no. 3236-SD sent to the relevant land registry office |
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2.2. The legal entity 2.2.1. The commercial company |
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Kbis extract |
Identification of the legal entity and the full name(s) and address(es) of the legal representative(s) |
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2.2.2. The craftsman |
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Proof of trade register |
Check that it is active |
Chamber of Trade |
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2.2.3. The association |
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By-laws |
Identification of the association |
Prefecture |
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3. Enforcement order 3.1. Judgement or ruling |
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Certificate of non-appeal |
Check that the title has become res judicata |
Registry of the Court of Appeal |
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Certificate of non-delivery |
Checking that appeals have been exhausted |
Registry of the Court of Cassation |
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3.2. Authentic deed |
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Pre-contentious formal notice |
Checking whether the expiry of the term is in order |
Customer |
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Forfeiture of term |
Liquidates the claim |
Customer |
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4. The building |
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Building sheet |
Checking the identity of the owner, the presence of registered creditors, the absence of publication of a summons to pay equivalent to seizure of the property, calculating the appropriateness of legal proceedings, obtaining publication references for the deeds to be ordered (title de vente, descriptive statement of division, amendments, etc.). |
CERFA n 3233-SD sent to the relevant land registry office |
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Title deed (deed of sale, gift, etc.) |
Identification of the nature of the property |
CERFA no. 3236-SD sent to the relevant land registry office |
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Descriptive statement of division, amendments to the descriptive statement of division |
Identification of the nature of the co-ownership lot |
CERFA no. 3236-SD sent to the relevant land registry office |
|
Land register |
Check the identity of the owner, the land registry references and the amount of property tax. |
CERFA n° 6815-EM-SD sent to the Centre des impôts fonciers (Land Tax Office) |
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Cadastral extract no. 1 |
Checking cadastral references |
CERFA n° 6450-N sent to the Land Tax Centre |
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Planning certificate |
Control of town planning easements, will be sent to the auction registry for identification of the holder of the right of pre-emption. |
CERFA no. 13410-03 from the town planning department |
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Cadastral map |
Identifying the location of the building |
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The document must include the information common to all bailiff's documents, as listed in article 648 of the Code of Civil Procedure: "Every document issued by a bailiff shall indicate, in addition to the information required elsewhere :
These details are prescribed on pain of nullity.
Article R. 321-3 of the French Code of Civil Enforcement Procedures sets out the information that must be included in the summons to pay for the seizure of property: "In addition to the information required for bailiff's documents, the summons to pay serving as a seizure shall include :
1° The appointment of a lawyer by the pursuing creditor, which entails the election of an address for service;".
2° An indication of the date and nature of the enforcement order under which the summons was issued;
3° A breakdown of the sums claimed in principal, costs and accrued interest, together with an indication of the rate of default interest;
4° A warning that the debtor must pay these sums within a period of eight days, that failing payment, the procedure for the sale of the property will continue and that to this end, the debtor will be summoned to appear at a hearing of the enforcement judge to rule on the terms of the procedure;
5° The description of each of the assets or rights to which the seizure relates, as required by the rules governing land registration;
6° An indication that the summons is tantamount to seizure of the property and that the property is unavailable to the debtor from the time the document is served and to third parties from the time it is published in the property register;
7° An indication that the summons is tantamount to seizure of the fruits and that the debtor is the sequestrator;
8° An indication that the debtor retains the possibility of seeking a buyer for the seized property in order to proceed with its amicable sale, or to give a mandate to this effect, and a mention that this sale may nevertheless only be concluded after authorisation from the enforcement judge;
9° A summons, where the property is the subject of a lease, to inform the bailiff of the surname, first name and address of the lessee or, in the case of a legal entity, its name and registered office;
10° An indication that a bailiff may enter the premises to draw up a description of the property;
11° Indication of the enforcement judge with territorial jurisdiction to hear the attachment proceedings and related disputes and incidental claims;
12° An indication that the debtor who so requests in advance may benefit, for the seizure procedure, from legal aid if he fulfils the means conditions provided for by Law No. 91-647 of 10 July 1991 on legal aid and Decree No. 91-1266 of 19 December 1991 implementing this law;
13° An indication, if the debtor is a natural person, that if he considers himself to be in a situation of over-indebtedness, he may refer the matter to the Commission de surendettement des particuliers (Private Individuals' Over-indebtedness Commission) set up by Article L. 712-1 of the French Consumer Code.
If the distraining creditor acts by virtue of a transfer, for whatever reason, of the claim contained in the writ of execution on which the proceedings are based, the summons shall refer to the act of transfer unless the debtor has been duly notified beforehand.
When the summons to pay is served on a person who has granted a mortgage on one of his assets to guarantee the debt of a third party, the time limit for the summons provided for in 4° is extended to one month.
The particulars provided for in this article shall be prescribed on pain of nullity. However, nullity shall not be incurred on the grounds that the sums claimed are greater than those due to the creditor".
Invalidity requires proof of a grievance (see e.g. Civ. 2e30 April 2009, no. 08-12.105).
On the other hand, an error in the calculation of the sums owed in the summons to pay for the seizure of property is never a ground for nullity.
Article R. 321-1, paragraph 2, of the Code of Civil Enforcement Procedures states that "The issue of a summons is an act of disposal, carried out at the creditor's risk.
An act of disposal is an act involving a transfer of rights that may have the effect of reducing the value of an asset.
The summons to pay for the seizure of the property is a disposal deed, because at the auction hearing, if there are no bids, the pursuing creditor is declared the successful bidder for the property for the amount of the upset price, which he must pay.
This is why the attachment procedure is carried out at the creditor's risk. This procedure presents specific risks that can have serious consequences.
For example, a syndicate of co-owners is pursuing the sale by public auction of a flat to recover a debt of €2,000.00. The hammer price is set at €30,000.00. If, at the auction hearing, no-one raises their bid, the syndicate of co-owners will be declared the winning bidder at the €30,000.00 reserve price.
Given the amount of its own debt, it will be able to set off the debtor against the legal set-off to limit the price to the sum of €28,000.00, which it will owe to the debtor. In this way, the syndicate of co-owners, which was initially a creditor, will become the debtor of its own debtor.
The way in which the summons is served depends on the identity of the distrainee, and it is important to understand at this stage that the debtor is not necessarily the distrainee.
The most common scenario is, of course, that of a property seizure initiated against a distrainee who is also a debtor. The way in which the summons is served will depend on the debtor's situation.
The summons is served on each of the co-debtors. For the debtors, this corresponds to a situation of indivision.
If the debtor is married, the procedures for serving the summons will depend on the matrimonial property regime and the quality of the property.
If the debtor is married under the community property regime, there are three options:
If the debtor is married under the separation of property regime, there are two options:
Caution! If the property being seized belongs to one of the spouses, but constitutes the family residence, then the summons to pay for the seizure of the property must be notified to the non-owner spouse, no later than the first working day following service of the document, in accordance with the third paragraph of article R. 321-1 of the Code of Civil Enforcement Procedures: "Where a property owned by one of the spouses is the family residence, the summons shall be served on the other spouse no later than the first working day following service of the document.
This time limit is stipulated on pain of invalidity of the summons to pay for the seizure of property (article R. 311-11 of the Code of Civil Enforcement Procedures).
There is no provision requiring the debtor's cohabiting partner to be served with the summons to pay for the seizure of the property (Civ. 2e30 April 2009, no. 08-12.105).
If the debtor is deceased and the devolution of the estate has been published in the real estate register, and the heirs are therefore known, it will suffice to apply the provisions of article 877 of the Civil Code: "A writ of execution against the deceased is also enforceable against the heir eight days after it has been served on him.
If the debtor is deceased and his heirs are not known, then the Administration des domaines will have to be appointed as trustee of the vacant estate, and the property seizure procedure will have to be pursued against it if it does not agree to resolve the dispute amicably.
These first two cases do not therefore require any changes to be made to the wording of the summons to pay in the form of a seizure, and are dealt with at the debtor identification stage.
If, on the other hand, the debtor is deceased, his heirs are known, and the devolution of the estate has not been published in the real estate register, then there will be a discrepancy between the identity of the debtor (the heir) and the identity of the owner identified in the real estate register (the de cujus.
In this case, the provisions of article 36 5° of decree no. 55-1350 of 14 October 1955 for the application of decree no. 55-22 of 4 January 1955 reforming land registration must be applied: " 5. In the event of publication of a summons to serve as a seizure order for a property belonging to an estate against the successors of a deceased person, or of the subsequent auction judgement, production of the notarial deed or the certificate provided for in 3-b of this article is not compulsory, when the document intended to be kept in the registers of the land registry service only includes the mention of certification of the identity of the deceased.
In the case referred to in the previous paragraph, the formality is considered to be required against the deceased alone, for entries in the file and the issue of copies, extracts or certificates. The same applies to registrations of legal or judicial liens or mortgages required against the successors in title of a deceased person in respect of a property forming part of an estate, where the notarised certificate of transmission by death - or the division in lieu thereof, pursuant to article 29 (paragraph 4) of the decree of 4 January 1955 - has not yet been published.
The summons to pay will therefore be served on the heirs, but its publication will be required against the de cujus in application of the provisions of the aforementioned article 36. The de cujus will be identified in the deed, so that the details in the summons match those in the property register.
Article R. 321-4 of the Code of Civil Enforcement Procedures states that "The seizure of property initiated by creditors with a right of resale is pursued against the third party purchaser of the property.
Article R. 321-5 of the same code adds that "The pursuing creditor shall serve a summons to pay on the principal debtor. The document shall state that the summons to pay with the effect of seizure provided for in the following paragraph shall be issued to the third party purchaser.
The summons to pay in the event of seizure is served at the instance of the pursuing creditor on the third party purchaser. It includes the information listed in article R. 321-3. However, the warning provided for in 4° is replaced by a summons to fulfil one of the obligations set out in article 2456 of the Civil Code within a period of one month and the reference to the debtor in 6°, 7°, 8°, 12° and 13° is to be understood as referring to the third party purchaser. The summons refers to the provisions of article 2464 of the Civil Code.
Article 2456 of the Civil Code states that "Once summoned to pay, and without prejudice to the benefit of discussion provided for in the preceding article, the third party purchaser may :
-or pay,
-purge the building in accordance with the rules set out in the following sub-section,
-or let yourself be seized.
The question of the purge of the property is dealt with in article 2464 of the Civil Code: "In the absence of the agreement provided for in the previous article, the third party purchaser may, once the sale has been published, purge the property of the right of resale attached to the mortgage.
He must, either before the proceedings or within one month of the first summons to pay made to him, notify the registered creditors of a deed stating that he is prepared to pay the mortgage debts immediately, whether or not they are due and payable, but up to the price stipulated in the deed of purchase or, if he has received the property by gift, up to the value he declares".
Lastly, a summons to pay equivalent to a seizure issued to a third party purchaser has the effects described in article R. 321-19 of the Code of Civil Enforcement Procedures: "Service of the summons to pay as a seizure on the third party purchaser has the same effect on the third party purchaser as service of the summons to pay as a seizure on the debtor.
If the third party purchaser fails to comply with the summons, the seizure of the property and the sale shall be pursued against the third party purchaser in accordance with the procedures set out in this book.
Two certificates will be issued:
Caution! The summons to pay in the form of a property seizure must comply with the rules applicable to the service of the summons on a debtor who may be married.
Example: a bank finances the purchase of a property, which it charges with a mortgage. The property is sold to a third party without the mortgage being cancelled. The bank, which has a right of pursuit, can take legal action against the third party to recover the sums owed by the seller of the property.
Article R. 321-3, paragraph 3, of the Code of Civil Enforcement Procedures states that "When the summons to pay is served on a person who has granted a mortgage on one of their assets to guarantee the debt of a third party, the time limit for the summons provided for in 4° is extended to one month.
Example: the son takes out a large consumer loan. The father grants the credit institution a conventional mortgage on his villa. Proceedings are brought against the father's property to recover a debt owed by the son.
Where there is more than one property, article R. 321-2 of the Code of Civil Enforcement Procedures provides as follows: "Where the seizure relates to immovable property located within the jurisdiction of several land registries, a summons to pay shall be drawn up for each jurisdiction.
The seizure of real estate located within the jurisdiction of several land registries requires the issuance of several orders to pay for the seizure of real estate, since publication of the orders will require an original copy to be sent to each land registry.
For the record, the first paragraph of Article L. 311-5 of the French Code of Civil Enforcement Procedures provides as follows: "A creditor who has seized one of his debtor's immovable properties may only initiate new seizure proceedings against another of his debtor's immovable properties if the property already seized is insufficient.
The creditor may not initiate a second seizure of property before completing the first without complying with the conditions of Article L. 311-5; however, he may ab initio seize several properties simultaneously.
In any event, territorial jurisdiction will be determined in accordance with the terms of Article R. 311-3 of the Code of Civil Enforcement Procedures: "Where a creditor has simultaneously seized several properties belonging to the same debtor located in the jurisdictions of several judicial courts, the proceedings shall be brought before the enforcement judge of the court in whose jurisdiction the seized property where the debtor lives is located, failing which, before the judge of the jurisdiction in which any of the properties is located.
Article R. 321-6 of the French Code of Civil Enforcement Procedures states that "The summons to pay is published in the property register within two months of being served.
This 2-month period must be observed in order for the order to be valid.
There is nothing to prevent the lawyer from publishing the summons before the expiry of the notice period of 8 days (debtor) or 1 month (mortgage guarantor), although this is not recommended.
This period is also increased, when the publication formality is rejected by the land registry, by the number of days elapsed between the filing of the summons for publication and the regularisation of the rejection (where this is possible), in accordance with the second paragraph of article R. 321-7 of the Code of Civil Enforcement Procedures: "Where performance of the publication formality has been delayed due to a rejection notified by the land registry service, the two-month period provided for in article R. 321-6 is increased by the number of days elapsed between the filing of the order with this service and performance of the formality. The date of filing is recorded in the register provided for in article 2453 of the Civil Code.
In other words, rejection of publication suspends the 2-month period until the matter is rectified.
Example: the publication is rejected due to a discrepancy between the statements in the summons and those in the property register concerning the debtor's name (MCKEY according to one, M'CKEY according to the other). The pursuing creditor regularises the rejection within 15 days. The 2-month publication period is suspended for 15 days and extended to 2 months and 15 days.
The lawyer shall send to the Land Registry :
In practice, the lawyer generally leaves it to the bailiff to reproduce the summons on the CERFA no. 3265-SD publication slip. It is the bailiff's responsibility to affix the certificate of conformity at the foot of the slip (article 79 of decree no. 55-1350 of 14 October 1955), so it is naturally up to him to draw it up.
The collation form allows the bailiff to certify that the two copies of the deed (the original and the copy on the publication slip) are in conformity with each other.
The certification form enables the lawyer to certify that the identity of the parties has been duly established on the basis of a birth certificate or a Kbis extract less than 6 months old (articles 5 and 6 of decree no. 55-22 of 4 January 1955).
Publication is subject to the following price scale:
Example: the publication of a summons to pay for the seizure of a flat made up of 3 lots (a flat, a cellar and a parking space) will cost 15 + 12 + 12 + 12 + 2 = €53.
Within 10-15 days, the lawyer will receive the return of his request for a building form, on which the publication references of the deed will appear, and then at a later date the original copy of the summons with the publication slip (a sticker).
Lastly, in the event of more than one summons, article R. 321-8 of the Code of Civil Enforcement Procedures provides for the following solution: "If the publication of several orders for seizure of the same property is required simultaneously, only the order which mentions the enforcement title bearing the earliest date shall be published. Where the titles bear the same date, only the oldest summons is published; if the summonses are of the same date, only the one with the highest principal claim is published.
In fact, when the publication of several summonses to pay is required simultaneously for the seizure of the same property, only one is published:
The refusal to publish is mentioned by the land registry in the margin of the published summons, as well as in the margin or following the refused summons (article R. 321-10 of the Code of Civil Enforcement Procedures).
Article R. 321-9 of the Code of Civil Enforcement Procedures states that "Where a summons to pay has already been published, there is no need to publish a new summons relating to the same property.
However, if the new summons presented to the land registry includes more property than the previous summons, it is published for the property not included in the previous summons. The new pursuing creditor is required to report the published summons to the previous creditor, who will pursue both proceedings if they are at the same stage; if not, the latter suspends its own pursuit and follows the new proceedings until they are at the same stage.
If the previous creditor fails to pursue the new seizure, the new creditor may request subrogation under the conditions set out in article R. 311-9.
Article R. 321-10 of the same code adds to its first two paragraphs that "In the cases provided for in article R. 321-8 and the first paragraph of article R. 321-9, the land registry mentions the deed or deeds that have not been published alongside the copy of the previous order published in the order in which they were presented, with the surname, first name and domicile of the new debtor or debtors or, in the case of a legal entity, its name and registered office as well as the name of the lawyer representing it or them.
He shall also indicate, in the margin or following the copy of the order presented, his refusal to publish it. He shall also mention each of the previously published or mentioned orders with the indications set out in the previous paragraph and that of the enforcement judge competent to hear the seizure.
Consequently, the mention of a summons to pay for the seizure of property that has not been cancelled in the property register prevents the publication of a new summons to pay for the seizure of property. In such cases, it is necessary to obtain the removal of the first summons before initiating new seizure proceedings. Publication of the summons to pay for the seizure of property will be rejected if another summons to pay for the seizure of property appears in the property register, unless the new summons concerns property not included in the previous summons.
In practice, the land registry will publish the second order in the margin of the first, giving it a marginal publication reference, and will add a new line to the property record, with a deed date, a filing date, an enliassement reference, and a type of deed bearing the wording "REFUSAL TO PUBLISH A WRIT OF SEIZURE..."..
Once the summons has been published, it will be returned to the pursuing creditor's lawyer with a publication sticker bearing a registration reference, with the following wording on the second line "RESA which means "refusal to seize.
Lawyers who are not vigilant and who are unaware of the meaning of the phrase "RESA may then believe that its deed has been published, which is totally false. In reality, the procedure will have to be repeated once the first order has been struck off.
If, on the other hand, the second summons includes properties that were not included in the first summons, then publication will be carried out for these properties. The author of the new summons must notify the previous creditor, who :
The text does not set out the practical arrangements for the previous creditor to continue the proceedings initiated by the second summons. It is conceivable that the creditor will have to issue a new summons in the second set of proceedings, in order to request that the cases be joined at the orientation hearing.
In practice, either the previous summons is less than 5 years old and the proceedings may still be in progress, in which case you should contact the lawyer for the pursuing creditor and the auction registry to advise them; or the summons is more than 5 years old and has expired. In the latter case, there are several solutions:
Article R. 321-13 of the French Code of Civil Enforcement Procedures states that "The unavailability of the property, the seizure of its fruits and the restriction on the debtor's rights of enjoyment and administration run with regard to the debtor from the date of service of the summons to pay in the form of a seizure.
These effects apply to third parties from the date of publication of the summons.
Where an agreement has been entered into prior to publication of the summons by the distrainee debtor in breach of the effects attached to service of the summons, it shall be declared null and void by the court at the request of the other party to the agreement.
The summons has effects with regard to the debtor, the third party purchaser and third parties.
Service of the summons to pay for the seizure of the property on the debtor renders the property unavailable. Consequently :
Article L. 321-2 of the French Code of Civil Enforcement Procedures states that "The act of seizure renders the property unavailable and restricts the seized person's rights of enjoyment and administration.
Subject to the provisions of article L. 322-1, the latter may not dispose of the property or encumber it with rights in rem.
Unless the property is rented, the garnishee is constituted as the receiver unless circumstances justify the appointment of a third party or the eviction of the debtor for serious cause.
The first paragraph of Article L. 322-1 states that "The assets are sold either out of court by judicial authorisation or by auction.
Lastly, article L. 311-3 of the Code of Civil Enforcement Procedures states that "Any agreement to the effect that the creditor may sell the debtor's immovable property without following the procedure prescribed for the seizure of immovable property is null and void.
Acts of disposal are acts by which the debtor disposes of his property, e.g. a deed of sale, gift, etc. The debtor may not sell, give away or encumber his property with real rights. In other words, the debtor may not sell, donate or encumber his property with real rights.
Article L. 321-4 of the French Code of Civil Enforcement Procedures states that "Leases granted by the debtor after the act of seizure are not enforceable against the pursuing creditor or the purchaser, regardless of their duration.
Any means may be used to prove that the lease has been in force for a longer period.
It should therefore be considered that, in the case of a property seizure, a lease entered into prior to service of the summons to pay in lieu of seizure may be enforced against the successful bidder, whereas a lease entered into after such service may not be enforced on the grounds that it was entered into in breach of the rule of law relating to the unavailability of the property.
However, the Court of Cassation has tempered this rule to the extreme, ruling that "the delivery of a summons to seize the property does not prohibit the conclusion of a lease or the tacit renewal of a lease previously concluded, and that the lease, even concluded after the publication of such a summons, may be set up against the successful bidder who was aware of it before the auction". (Cass. civ., 2nd, 27 Feb. 2020, no. 18-19.174, published in the Bulletin).
With this position, the Court of Cassation reiterates its established case law, the reasons for which are set out below (Civ. 3e, 15 January 1976, no. 74-13.676; Civ. 3e, 11 February 2004, no. 02-12.762; Civ. 3e, 23 March 2011, no. 10-10.804, Civ. 3e, 9 June 2016, no. 15-10.595).
It directly contradicts Article 4 of the General Provisions of the Terms and Conditions of Sale relating to seizures, the second paragraph of which states that "leases granted by the debtor after delivery of the summons to pay in the event of seizure are not enforceable against the pursuing creditor or the purchaser"..
If the successful bidder wishes to evict a tenant whose lease was signed after the summons was served, he will have to prove that he was unaware of the existence of the lease.
If, on the other hand, the lease is not enforceable against the successful bidder, then the latter may invoke the provisions of articles L. 322-13 and R. 322-64 of the Code of Civil Enforcement Procedures.
Article L. 322-13 states that "The auction judgement constitutes a writ of eviction against the distrainee.
Article R. 322-64 states that "Unless the terms and conditions of sale provide for the distrainee debtor to remain on the premises, the successful bidder may enforce the eviction order that he has against the distrainee and any of his occupants who do not have any rights enforceable against him from the time the price is paid or deposited and the taxed costs are paid.
Article R. 321-15, paragraph 2, of the Code of Civil Enforcement Procedures states that "If the circumstances justify it, the execution judge may, at the request of the pursuing creditor or the debtor, authorise the performance of certain acts on the seized property.
The distrainee therefore has the option of asking the judge for authorisation to dispose of the property.
Example: A property seizure is initiated against a villa to recover the sum of €3,000.00. The debtor asks the judge for authorisation to divide the land on which the villa stands so that only part of it can be sold, in order to pay off the pursuing creditor from the sale price of this parcel.
Article R. 321-16 of the Code of Civil Enforcement Procedures states that "The fruits immobilised from the date of service of the summons to pay in the event of seizure are distributed with the price of the property in the same order as the distribution of the latter.
Article R. 321-17 of the Code of Civil Enforcement Procedures adds that "The pursuing creditor may authorise the distrainee to sell the fruits out of court or, with the authorisation of the enforcement judge, may himself proceed with the cutting and sale of the fruits, which will be sold by auction or by any other means within the period set by the judge.
The price is deposited with the receiver appointed by the pursuing creditor or consigned to the Caisse des dépôts et consignations.
Lastly, article R. 321-18 of the Code of Civil Enforcement Procedures states that "The pursuing creditor may, by bailiff's deed, prevent the tenant from paying the rent and lease payments into the hands of the debtor and require him to pay them into the hands of a receiver designated by him or to deposit them at the Caisse des dépôts et consignations.
In the absence of such opposition, payments made to the debtor are valid and the debtor is the receiver of the sums received.
The debtor is the receiver of the fruits. As the fruit may deteriorate if it is not picked or stored but not sold, the aforementioned article R. 321-17 allows the pursuing creditor to authorise the distrainee to sell it, and failing that to sell it himself, with the prior authorisation of the enforcement judge.
If, on the other hand, the fruits are not plants (vegetables, fruit, etc.) but rents, then the seized debtor will retain the status of receiver. The pursuing creditor may then order that the fruit be deposited with a different receiver, by a writ issued by a bailiff.
In practice, the receiver of the sums arising from the property seizure procedure is appointed when the conditions of sale are filed. Rents and farm rents may therefore be deposited with a different receiver. This solution is obviously not recommended, and it would be simpler to instruct the same receiver to receive the fruits and the sale price.
Caution! Article L. 321-16 of the French Code of Civil Enforcement Procedures states that "The act of seizure of an immovable shall entail seizure of its fruits, except for the effect of an earlier seizure.
The pursuing creditor who knows that a tenant is occupying the seized property will therefore have an interest in seizing the rent from the tenant who is benefiting from a seizure-attribution procedure with successive execution before initiating the property seizure procedure. This will prevent the rents from being included in the basis of assessment for the distribution of funds and, consequently, prevent them from being shared with the other registered creditors.
Conversely, a creditor who is unaware of the presence of a tenant on the premises before the descriptive report is drawn up will have to oppose payment of the rent and will see the rent incorporated into the basis of assessment for the distribution of the funds.
Article L. 321-2 of the Code of Civil Enforcement Procedures states that "Unless the property is rented, the distrainee is constituted sequestrator unless circumstances justify the appointment of a third party or the eviction of the debtor for serious cause.
Article R. 321-15, paragraph 1, adds that "Unless his eviction is ordered, the debtor retains the use of the seized property provided that he does not perform any material act likely to reduce its value, on pain of damages and without prejudice, where applicable, to the penalties provided for in article 314-6 of the French Criminal Code.
The seized debtor may enjoy the property, but may not reduce its value, on pain of damages and criminal prosecution.
Example: Seizure proceedings are initiated against a townhouse. The debtor, a bricklayer, sawed the roof beams, which collapsed after the summons had been issued for the preliminary hearing and the conditions of sale had been filed, setting the upset price.
The value of the property has deteriorated and it seems impossible to sell it for more than the upset price. The pursuing creditor can no longer proceed without taking considerable risks, since a lack of bids could result in the property being included in his estate.
In accordance with article R. 321-19 of the Code des procédures civiles d'exécution, the effects of issuing the summons on the third party holder are the same as those on the debtor: "Service of the summons to pay as a seizure on the third party purchaser has the same effect on the third party purchaser as service of the summons to pay as a seizure on the debtor.
If the third party purchaser fails to comply with the summons, the seizure of the property and the sale shall be pursued against the third party purchaser in accordance with the procedures set out in this book.
Article R. 321-13 of the French Code of Civil Enforcement Procedures states that "The unavailability of the property, the seizure of its fruits and the restriction on the debtor's rights of enjoyment and administration run with regard to the debtor from the date of service of the summons to pay in the form of a seizure.
These effects apply to third parties from the date of publication of the summons.
Where an agreement has been entered into prior to publication of the summons by the distrainee debtor in breach of the effects attached to service of the summons, it shall be declared null and void by the court at the request of the other party to the agreement.
Article L. 321-5 of the same code adds that "The seizure of property is enforceable against third parties from the time of its publication in the property register.
Unpublished or subsequently published disposals that have not been carried out in accordance with the conditions set out in article L. 322-1 may not be set up against the pursuing creditor or the purchaser, unless a sum sufficient to pay the principal, interest and costs owed to the registered creditors and the pursuing creditor is deposited with the Caisse des Dépôts et Consignations; the sum thus deposited is allocated specifically to them.
Registrations on behalf of the distrainee which have not been made prior to the publication of the seizure shall likewise be unenforceable, subject to the right of the vendor, the lender of funds for the acquisition and the co-partitioner to register, within the time limits set out in articles 2379 to 2381 of the Civil Code, the lien conferred on them by article 2374 of the same code.
The summons is therefore enforceable against third parties from the date of its publication in the property register.
An agreement entered into between service and publication of the summons by the distrainee debtor may be declared null and void by the court at the request of the other party.
An agreement that has not been published or that has been published after publication of the summons may be declared enforceable against the pursuing creditor and the registered creditors, subject to the deposit of a sum sufficient to satisfy them.
Lastly, article R. 321-14 of the Code of Civil Enforcement Procedures states that "In order to enforce a sale published after the publication of the summons to pay valid as a seizure, the deposit provided for in the second paragraph of article L. 321-5 is served on the pursuing creditor and the registered creditors before the auction hearing, without any time limit being granted for doing so.
Article R. 321-20 of the French Code of Civil Enforcement Procedures states that "A summons to pay in the form of a seizure ceases to have effect by operation of law if, within five years of its publication, no mention has been made in the margin of this publication of a judgement recording the sale of the seized property.
In the event of refusal to lodge the order or rejection of the publication formality, the five-year period does not begin to run until the application has been regularised or the decision mentioned in article 26 of decree no. 55-22 of 4 January 1955 reforming land registration has been taken.
Publication is recorded on the day the deed is filed with the land registry.
When the publication has been rejected, it is registered from the date on which the rejection is rectified (article 34 of the decree of 4 January 1955).
Where publication has been refused or rejected and the refusal or rejection decision has been challenged before the administrative court, the date of publication of the order is that of the decision ordering publication (article 26 of the decree of 4 January 1955).
The expiry period, which used to be 2 years, was increased to 5 years by article 2 of decree no. 2020-1452 of 27 November 2020. The second paragraph of article 12 of the same decree states that "The other articles come into force on 1 January 2021. They apply to proceedings in progress on that date, with the exception of 19° and 25° of Article 1 and Article 10, which apply to proceedings commenced on or after 1 January 2021.
Thus, the amendment to the limitation period applies to current proceedings, it being specified that if the limitation period has already been extended and the judgment ordering this extension specified that it was valid for a new period of 2 years, then the res judicata effect of this decision will prevent the application of the provisions of the aforementioned article 12.
Furthermore, an enforcement judge who finds that the effects of a summons have lapsed cannot hear disputes relating to the substance of the right (Cass. 2e civ., 19 March 2015, no. 14-10.239, Bull. 2015, II, no. 70).
Lastly, a time-barred summons to pay (commandement de payer valant saisie) retains its effect of interrupting the limitation period until the proceedings are terminated, i.e. until the decision noting that its effects have lapsed (Cass. 2e civ., 1 March 2018, no. 17-11.238, Bull 2018, II, no. 42).
Article R. 321-21 of the Code of Civil Enforcement Procedures states that "On expiry of the period provided for in article R. 321-20 and until publication of the title deed, any interested party may ask the enforcement judge to declare that the summons has lapsed and to order that this be noted in the margin of the copy of the summons published in the property register.
Where proceedings are pending before the enforcement judge, the application for a declaration that the summons has lapsed shall be submitted to the judge by way of pleadings.
The case law holds that the judge may raise the issue of lapse of time of his own motion (Civ. 2e21 March 2019, no. 17-31.170) and that it may be established by the judge on the application presented by the debtors for the first time before the court of appeal, even though it was acquired before the orientation hearing (Civ. 2e18 October 2018, no. 17-21.293).
By virtue of the rule that a summons to pay in the event of seizure cannot be published in the property register if another summons to pay in the event of seizure has previously been published and not cancelled, a third party to the proceedings may have an interest in requesting that the summons to pay be cancelled.
In practice, this request to strike off the register is made by writ of summons, in the same form as a writ of summons outside the orientation hearing.
Article R. 321-22 of the Code of Civil Enforcement Procedures states, with regard to the time limit for expiry, that "This period is suspended or extended, as appropriate, by a note in the margin of the copy of the published summons of a court decision ordering the suspension of enforcement proceedings, the postponement of the sale, the extension of the effects of the summons or the decision ordering the reopening of the auction.
The extension of the effects of the summons runs from the time when the decision to suspend or extend is published in the property register, and not from the time when that decision is made (Cass. 2e civ., 19 Oct. 2017, no. 16-15.236, Published in the bulletin).
The request for an extension of the effects of the summons is filed by way of submissions with the auction registry, which will summon the parties by recorded delivery letter.
It must therefore be submitted within a timeframe that allows the court clerk to summon the parties, the judge to deliberate and the lawyer to proceed with the publication formality.
The request for an extension of the effects of the summons is an incidental request that may be submitted after the orientation hearing (Civ. 2e9 June 2011, no. 10-30.310).
Article R. 311-11 of the French Code of Civil Enforcement Procedures states that "The time limits stipulated in articles R. 321-1, R. 321-6, R. 322-6, R. 322-10 and R. 322-31, as well as the two- and three-month time limits stipulated in article R. 322-4, must be observed in order for the summons to pay to become valid.
Any interested party may ask the enforcement judge to declare the order null and void and to order, where necessary, that this be noted in the margin of the copy of the order published in the real estate register.
The application shall not be granted if the pursuing creditor can show a legitimate reason.
The declaration of lapse may also be revoked if the pursuing creditor informs the registry of the enforcement judge, within fifteen days of the declaration of lapse, of the legitimate reason that he would not have been able to invoke in good time.
The prescribed deadlines are :
Lapse retroactively renders the summons ineffective and extinguishes the proceedings (Civ. 2e4 September 2014, no. 13-11.887).
In addition, the lapse "reaches all the acts of the seizure procedure". that the order initiates. Consequently, all subsequent procedural acts are annulled (Civ. 2e19 February 2015, no. 13.28-445). In this case, the cancellation of the subsequent acts deprived the summons to the orientation hearing of its effect of interrupting the limitation period.
Paragraphs 3 and 4 of the aforementioned article R. 311-11 stipulate that "The application shall not be granted if the pursuing creditor can show a legitimate reason.
The declaration of lapse may also be revoked if the pursuing creditor informs the registry of the enforcement judge, within fifteen days of the declaration of lapse, of the legitimate reason that he would not have been able to invoke in good time.
The judge may therefore declare the contract null and void on legitimate grounds.
The decision to report is notified by the court registry.
Example: the creditor initiates proceedings for the seizure of a villa, without having the birth certificate of the debtor, who is a foreign national. When the summons to pay was issued, the debtor met the bailiff in person, to whom he declared that the villa was rented. At the orientation hearing, the debtor asked the judge to declare the order for payment null and void on the grounds that only an outbuilding located at the end of the plot was rented and that the villa itself constituted the marital home. As soon as he was informed, the creditor denounced the summons to the spouse and invoked the provisions of the aforementioned article R. 311-11. The court upheld the creditor's claim.
Article R. 322-20 of the Code of Civil Enforcement Procedures states that "An application for the amicable sale of the property may be submitted and judged before service of the summons to appear at the orientation hearing, provided that the debtor brings into question the creditors registered on the property.
The decision granting the application suspends the course of the enforcement proceedings, with the exception of the period allowed for registered creditors to declare their claims.
The debtor may submit a request for an amicable sale without waiting for the judge's authorisation, provided that the registered creditors are involved, in the form of a summons and a denunciation outside the orientation hearing.
The judgment authorising the out-of-court sale will comply with the requirements of article R. 322-21 of the Code of Civil Enforcement Procedures. Article R. 322-20 simply states that the judge may give a ruling before the orientation hearing. This text has no influence on the content of the judgment, which results from article R. 322-21: "The enforcement judge who authorises the out-of-court sale sets the price below which the property may not be sold in view of the economic conditions of the market and, where applicable, the specific conditions of the sale.
The judge charges the costs of proceedings at the request of the pursuing creditor.
It sets the date of the hearing at which the case will be recalled within a period that may not exceed four months.
At this hearing, the judge may only grant additional time if the applicant can provide proof of a written commitment to purchase and to allow the deed of sale to be drawn up and concluded. This period may not exceed three months.
Finally, it should be noted that the procedure is suspended from the date of the judgement handed down by the enforcement judge following referral by the debtor.
Article R. 321-22 of the Code des procédures civiles d'exécution (Code of Civil Enforcement Procedures) sets out a specific mechanism for dealing with the expiry of the summons to pay for the seizure of property, relating to the time limit for expiry of the summons to pay: "This period is suspended or extended, as appropriate, by a note in the margin of the copy of the published summons of a court decision ordering the suspension of enforcement proceedings, the postponement of the sale, the extension of the effects of the summons or the decision ordering the reopening of the auction.
Thus, publication of the judgment authorising the sale out of court will suspend the time limit for expiry of the summons until the sale is completed or until legal proceedings are resumed.
On the other hand, the text does not provide for any automatic mechanism to compensate for the lapse of the summons to pay for the seizure of property if, as a result of the summons issued by the debtor, he suspends the proceedings and fails to take one of the numerous steps provided for on pain of lapse.
As a result, the pursuing creditor will be obliged to continue the proceedings until the judgment authorising the amicable sale has been handed down. Given the length of the proceedings, this considerably reduces the scope and value of the writ of summons for out-of-court sale.
Article R. 322-1 of the Code of Civil Enforcement Procedures provides that "On expiry of a period of eight days from the date of issue of the summons to pay, and in the absence of payment, the bailiff may enter the premises under the conditions set out in article L. 322-2.
Article L. 322-2 of the Code of Civil Enforcement Procedures adds that "The bailiff may enter the premises and, if necessary, have the doors and furniture opened in order to describe the seized property.
In the absence of the occupant of the premises or if the occupant refuses access, the bailiff shall proceed as provided for in Articles L. 142-1 and L. 142-2. Where the premises are occupied by a third party by virtue of a right enforceable against the debtor, the bailiff may enter only with the prior authorisation of the enforcement judge, in the absence of the occupant's agreement."
The bailiff must enter the premises within a minimum period of 8 days from the date of issue of the summons to pay.
The inspector may enter the premises with the occupant's consent. Failing this, the inspector may enter the premises in the presence of a representative of the municipality, a police or gendarmerie officer or two witnesses in accordance with article L. 142-1 of the French Code of Civil Enforcement Procedures.
The authorisation of the enforcement judge is sought by means of a petition. In practice, some enforcement judges ask the lawyer to attach to his application a statement of default to prove that application of the provisions of the aforementioned article L. 142-1 is necessary.
When the proceedings are directed against the third party holder or the mortgage guarantor, the minimum period remains 8 days. This solution would appear to conflict with the 1-month time limit given to them to fulfil their obligations under the summons. This is why we recommend that you wait until this period has expired before asking the bailiff to draw up the descriptive report.
Article R. 322-2 of the Code of Civil Enforcement Procedures states that "The description report includes :
1° Description of the premises, their composition and surface area ;
2° An indication of the conditions of occupancy and the identity of the occupants, together with a statement of the rights to which they are entitled;
3° Where applicable, the name and address of the co-ownership manager;
4° Any other useful information about the building provided, in particular, by the occupier.
The obligation to state the surface area means that the bailiff must be accompanied by an expert diagnostician, who will be responsible for drawing up a Carrez measurement.
Article L. 271-4 I of the French Construction and Housing Code states that "I.-In the event of the sale of all or part of a built property, a technical diagnostic file, supplied by the vendor, is appended to the promise of sale or, in the absence of a promise, to the deed of sale. In the case of a public sale, the technical diagnostic file is appended to the specifications.
The technical diagnostic file includes the following documents, under the conditions defined by the provisions governing them:
1° The lead exposure risk report provided for in articles L. 1334-5 and L. 1334-6 of the Public Health Code ;
2° A statement mentioning the presence or absence of materials or products containing asbestos, as provided for in article L. 1334-13 of the same code;
3° A report on the presence of termites in the building, as provided for in article L. 126-24 of this code;
4° A statement of the internal gas installation, as provided for in article L. 134-9 of this code;
5° In the zones mentioned in I of article L. 125-5 of the Environment Code, the statement of natural and technological risks provided for in the second paragraph of I of the same article;
6° The energy performance diagnosis and, where applicable, the energy audit provided for in articles L. 126-26 and L. 126-28-1 of this code;
7° The condition of the domestic electricity installation as provided for in Article L. 134-7 ;
8° The document drawn up following the inspection of non-collective sanitation installations referred to in article L. 1331-11-1 of the Public Health Code or, in territories where wastewater and rainwater discharges have an impact on water quality for the Olympic freestyle swimming and triathlon events on the Seine, the document drawn up following the inspection of connection to the public wastewater collection network referred to in II of article L. 2224-8 of the General Local Authorities Code;
9° In the areas covered by article L. 131-3 of this code, information on the presence of a risk of merula ;
10° If the property is located in one of the noise zones defined by an aerodrome noise exposure plan provided for in article L. 112-6 of the town planning code, a document clearly and precisely indicating this zone, as well as the other information provided for in I of article L. 112-11 of the same code.
11° If the property is located within the perimeter of an atmospheric protection plan as provided for in article L. 222-4 of the Environment Code, a certificate attesting to the compliance of the wood-burning appliance with the installation and emission rules laid down by the representative of the State in the département.
The documents mentioned in 1°, 4° and 7° of this I are only required for buildings or parts of buildings used for residential purposes.
The document referred to in 10° is only required for buildings or parts of buildings for residential use or for professional and residential use.
The documents mentioned in 6° are not required in the case of the sale of a building under construction as referred to in article L. 261-1.
Where the premises being sold are subject to the provisions of law no. 65-557 of 10 July 1965 establishing the status of co-ownership of built-up properties or belong to persons holding real property rights over the premises or to holders of shares which may or may not give entitlement to the allocation or enjoyment of ownership of the premises, the document referred to in 1° relates exclusively to the private part of the building allocated to the dwelling and the documents referred to in 3°, 4° and 7° relate to the private part of the lot.
The energy audit referred to in 6° of this I is provided by the vendor or his representative to the potential purchaser during the first visit to the building or part of the building that is the subject of such an audit. This information may be provided by any means, including electronically.
II - In the absence of one of the documents mentioned in 1°, 2°, 3°, 4°, 7° and 8° of I being valid at the time of signing the deed of sale, the vendor may not exempt himself from the corresponding guarantee against hidden defects.
In the absence of the document referred to in 5° of I when the deed of sale is signed, the purchaser may rescind the contract or apply to the court for a reduction in the price.
If the on-site sewage treatment system is not compliant when the deed of sale is signed, the purchaser must have the necessary work carried out within one year of the deed of sale.
The purchaser may not take advantage of the recommendations accompanying the energy performance diagnosis or the document relating to the location of the property in an area defined by a noise exposure plan for airfields, which are for information purposes only.
It should be noted that article 94 of the law no. 2019-1428 of 24 December 2019 on the orientation of mobilities, which came into force on 1 December 2019, does not apply to the new system.e June 2020, adding a 10e diagnosis :
"10° If the property is located in one of the noise zones defined by an aerodrome noise exposure plan provided for in article L. 112-6 of the town planning code, a document containing a clear and precise indication of this zone as well as the other information provided for in I of article L. 112-11 of the same code.
[...]
The document referred to in 10° is only required for buildings or parts of buildings used for residential purposes or for professional and residential purposes.
In addition, Article 68 of Law no. 2019-1428 of 24 December 2019 created Article L. 112-21 of the Construction and Housing Code, which requires the seller to provide a prior geotechnical study in the event of the sale of a non-built plot of land suitable for building: "In the case of the sale of undeveloped land suitable for building, a prior geotechnical study must be provided by the vendor.
This report is appended to the promise of sale or, in the absence of a promise, to the deed of sale. In the event of a public sale, the survey is appended to the specifications. It remains attached to the title deed for the land and follows any successive changes to the land.
Sales of undeveloped land intended for construction in areas where the applicable town planning provisions do not allow the construction of single-family homes do not fall within the scope of this article.
The sentence "In the case of a public sale, the technical diagnostic file is appended to the specifications. of article L. 271-4, the terms of which are taken over by article L. 112-21, has given rise to controversy in the legal literature, with some authors taking the view that auctions are not public sales and that the conditions of sale are not the specifications. In their view, this obligation refers to notarised auctions.
Finally, as part of the technical diagnostics file, the diagnostician and/or the bailiff accompanying him will check that the property is connected to the mains sewer, in accordance with article L. 1331-1 of the French Public Health Code: "Buildings must be connected to the public sewerage system designed to receive domestic wastewater and laid under the public road to which they have access, either directly or via private roads or rights of way, within two years of the public sewerage system being brought into service.
An interministerial decree determines the categories of buildings for which a mayoral decree, approved by the State representative in the département, may grant either extensions to the time limits, which may not exceed ten years, or exemptions from the obligation set out in the first paragraph.
The municipality may decide that between the commissioning of the public collection network and the connection of the building or the expiry of the period allowed for connection, it will collect from the owners of buildings that can be connected a sum equivalent to the fee introduced in application of article L. 2224-12-2 of the General Local Authorities Code.
The municipality may lay down technical requirements for the connection of buildings to the public wastewater and rainwater collection network.
In practice, most lawyers have the technical diagnostic file drawn up at the same time as the Carrez measurement, for a number of reasons:
Example: when drawing up the technical diagnostic file, the expert diagnostician discovers the presence of termites and asbestos in the building. The initial reserve price will be lowered.
Alternatively, it is possible to postpone drawing up the technical diagnostics file until the time of the visit to the foreclosed property prior to the auction hearing. This is a doubly cost-effective solution, as some diagnostics expire within 3 months of being drawn up, so if they were drawn up at the time of the descriptive report, they will inevitably be out of date by the time of the sale and will need to be updated.
The summons must be issued within 2 months of publication of the summons to pay for the seizure of property (article R. 322-4 of the Code of Civil Enforcement Procedures), failing which the summons will lapse (article R. 311-11 of the Code of Civil Enforcement Procedures).
The date of the orientation hearing is set in the summons. It must be between +1 and +3 months from the date of issue of the summons. Only the 3-month period is stipulated, failing which the summons will lapse (article R. 311-11 of the Code of Civil Enforcement Procedures).
Beware of the increases in the time limits for appearing referred to in Article 643 of the Code of Civil Procedure, which apply to the abovementioned time limits for appearing: "When the claim is brought before a court having its registered office in mainland France, the time limits for appearance, appeal, opposition, third-party opposition in the case provided for in article 586 paragraph 3, application for review and appeal to the Supreme Court are increased by :
In the case of a person residing abroad, the time limits will be extended to +2 and +4 months, or +3 and +5 months depending on the case.
The text does not stipulate any penalty for failure to comply with the minimum 1-month time limit, but it would appear that the creditor may be dismissed, subject to proof of a grievance.
The Court of Cassation has reiterated that the minimum time limit of 1 month is not provided for on pain of lapsing, in a case involving a debtor residing abroad (Cass. 2e civ., 21 Feb. 2019, no. 17-27.487, Published in the bulletin).
Article R. 322-5 of the Code of Civil Enforcement Procedures states that "In addition to the information required by Article 56 of the Code of Civil Procedure, the writ of summons shall include, on pain of nullity :
1° Indication of the place, day and time of the orientation hearing of the enforcement judge ;
2° An indication that the purpose of the orientation hearing is to examine the validity of the seizure, to rule on any disputes and incidental claims relating thereto and to determine the terms and conditions under which the proceedings will be continued;
3° Information that, if the debtor is not present or represented by a lawyer at the hearing, the proceedings will be continued as a forced sale, on the sole basis of the information provided by the creditor;
4° The summons to acquaint oneself with the conditions of sale set out in the schedule of conditions of sale, which may be consulted at the registry of the execution judge, where it will be deposited no later than the fifth working day after the summons, or at the office of the pursuing creditor's lawyer;
5° An indication of the upset price as set out in the sales conditions and the possibility of contesting the amount on the grounds of manifest inadequacy;
6° A warning that the debtor may ask the execution judge to be authorised to sell the seized property out of court if he can prove that a non-judicial sale can be concluded under satisfactory conditions;
7° An indication, in very conspicuous characters, that under penalty of inadmissibility, any dispute or incidental claim must be filed at the registry of the enforcement judge in the form of a lawyer's submission, no later than the time of the hearing;
8° A reminder of the provisions of articles R. 322-16 and R. 322-17 ;
9° An indication that the debtor, who so requests in advance, may benefit from legal aid for the seizure procedure, if he or she meets the means test provided for by Law No. 91-647 of 10 July 1991 on legal aid and Decree No. 2020-1717 of 28 December 2020 implementing this law.
The omission of a mention in the summons is sanctioned by the nullity of the document, subject to the demonstration of a prejudice within the meaning of article 114 of the code of civil procedure.
The pursuing creditor must set the amount of the upset price when drawing up the summons for the orientation hearing, as this is a compulsory part of the deed.
The descriptive report, which will have been drawn up prior to the filing of the terms and conditions of sale, will enable the pursuing creditor to ascertain the extent of the seized property, its condition and the conditions under which it is occupied in order to set the upset price.
In practice, the bailiff should be asked to send the descriptive report at least 15 days before the deadline for summons, so that the client can analyse it and determine the upset price.
The sale price must never be overestimated. The first paragraph of Article L. 322-6 states that : "The amount of the reserve price is set by the pursuing creditor. In the absence of a bid, the creditor is automatically declared the successful bidder at this amount.
In the absence of a bid, the pursuing creditor will be declared the successful bidder for the amount of the reserve price.
This poses two types of problem:
Example 1: A syndicate of co-owners initiates proceedings for seizure of property to recover a debt of €3,000.00. Against the advice of its solicitor, it sets the reserve price at €30,000.00. In the absence of a bid, the syndicate is declared the winning bidder and may use set-off to reduce the amount of the reserve price to €27,000.00, which it must pay to the seized debtor, to whom it in turn becomes indebted.
Example 2: a bank is declared the successful bidder for a building. Its articles of association prohibit it from including a building in its assets. It will have to mandate the subsidiary in charge of managing its real estate assets to bid higher and be declared the winning bidder in its place at the end of the higher bidding hearing, generating a significant additional cost.
Article R. 322-6 of the Code of Civil Enforcement Procedures states that "No later than the fifth working day following the delivery of the summons to the debtor, the summons to pay valid as a seizure is notified to the creditors registered on the day of publication of the summons.
The notification is equivalent to a summons to appear at the orientation hearing.
This time limit is provided for in the event that the summons to pay is declared null and void (article R. 311-11 of the Code of Civil Enforcement Procedures). However, the registered creditor to whom the summons to pay is served late will have no interest in arguing that the summons to pay is null and void. Even late notification will enable the creditor to declare his claim in the proceedings and thereby preserve his rights.
Registered creditors will be identified by means of a mortgage statement that the pursuing creditor will have previously requested from the land registry using CERFA form no. 3233-SD.
In practice, the pursuing creditor uses the mortgage statement that he had requested when the summons to pay was drawn up.
On the other hand, the procedure does not have to be notified to creditors whose registrations have been accepted for deposit and are awaiting registration on the date of publication of the summons to pay in the form of a seizure. These registrations are listed at the foot of the property sheet in the box "Certificate of deposit (Cass. civ., 2e, 10 April 2014, no. 13-13.770).
Lastly, the pursuing creditor may well have the dual status of pursuing creditor and registered creditor and should, where appropriate, implement the declaration of claim procedure in parallel with the seizure of property procedure, even if this leads to certain aberrations. Indeed, as soon as the registered creditor has to notify the pursuing creditor of his claim, the lawyer will have to notify himself of this claim.
Article R. 322-7 of the Code of Civil Enforcement Procedures states that "In addition to the information required by Article 56 of the Code of Civil Procedure, the notice shall include, under penalty of nullity :
1° Indication of the place, day and time of the orientation hearing ;
2° The summons to acquaint oneself with the schedule of conditions of sale, which may be consulted at the registry of the enforcement judge, where it is deposited no later than the fifth working day after the date of the debtor's summons to the orientation hearing, or at the office of the pursuing creditor's lawyer;
3° An indication of the reserve price as set out in the sales conditions;
4° A summons to declare the debts registered on the seized property, in principal, costs and accrued interest, with an indication of the rate of default interest, by a lawyer's deed filed at the registry of the execution judge and accompanied by a copy of the debt deed and the registration slip, and to notify the pursuing creditor and the debtor of this declaration on the same day or the first working day following, in the same form or by service ;
5° The reproduction, in clearly visible characters, of articles L. 331-2 and R. 322-12 ;
6° A reproduction of article R. 311-6.
As in the case of the summons to the orientation hearing, the omission of a statement is subject to the formal nullity rules of article 114 of the Code of Civil Procedure, so that it is necessary to demonstrate that there is a grievance.
Article R. 322-8 of the French Code of Civil Enforcement Procedures states that "Notice to registered creditors may be given at the addresses indicated on the registration forms.
It may be made to the heirs collectively without designation of their respective names and capacities, at their elected domicile or, failing that, at the domicile of the deceased.
In practice, almost all registrations will include an elected domicile. If they are made by a notary, lawyer or bailiff, the address for service will generally be at the office, chambers or law firm.
As this is a simple possibility, the pursuing creditor is free to serve the document at another address (e.g. the registered office, a secondary establishment, etc.).
Article R. 322-9 of the Code of Civil Enforcement Procedures states that "Mention of the issue of the summons and of the notifications is made in the margin of the copy of the summons to pay for the seizure published in the property register within eight days of the last service.
From the date of this mention, the registration of the summons may only be cancelled with the consent of all registered creditors or by virtue of a judgment enforceable against them.
The summons and notices must be published in the margin of the summons to pay within 8 days of the last date of service, bearing in mind that the notices themselves must be served within 5 days of service of the summons. However, there is no penalty for failing to publish within 8 days.
Publication is required on the margin of the summons to pay in the form of a seizure by sending the original and a copy of the summons to the orientation hearing, duly certified, to the Land Registry, together with a cheque made payable to Treasury from €15.
It is also possible to request a mortgage statement (CERFA no. 3233-SD) that is up to date on the date of publication of the summons, in order to have the publication references in the file without waiting for the original copy of the deed to be returned, which can take a long time. The cost of this request will be €12 per parcel and/or per co-ownership lot, plus €2 postage.
The procedures for filing the conditions of sale are described in article R. 322-10, paragraph 1, of the French Code of Civil Enforcement Procedures: "No later than the fifth working day following the summons delivered to the distrainee debtor, the pursuing creditor deposits at the registry of the enforcement judge a schedule of conditions of sale containing a description of the property and the terms of the sale. A copy of the summons issued to the debtor and a certified mortgage statement as at the date of publication of the summons to pay in lieu of seizure are attached.
The terms and conditions of sale must be filed with the registry of the auctioneers by no later than 5 November.e working day following delivery of the summons, failing which the summons will lapse (article R. 311-11 of the French Code of Civil Enforcement Procedures). The deposit must be accompanied by :
The clerk's office will provide the lawyer with an acknowledgement of filing of the conditions of sale, after going through its contents and requesting any additional documents.
The book will be constructed like a contract, with specific and general conditions; except that in this case the terminology used is that of specific and general provisions. This is not just a quirk: unlike a contract which stipulates, the law provides; and as a result, the schedule of conditions of sale, which has a legal origin, contains both specific and general provisions.
The content of the special provisions is described in article R. 322-10, paragraph 2, of the Code of Civil Enforcement Procedures: "The conditions of sale contain, under penalty of nullity :
1° A statement of the enforcement order under which the proceedings are being taken;
2° A statement of the sums due to the pursuing creditor in principal, costs and accrued interest, together with an indication of the rate of default interest;
3° A statement of the summons to pay in the form of a seizure, with a mention of its publication and of other subsequent deeds and judgments;
4° A description of the property seized, the origin of ownership, any easements encumbering the property, any leases granted on the property and the description report;
5° The conditions of the judicial sale and the upset price set by the pursuing creditor;
6° The appointment of a receiver of the funds from the sale or from the Caisse des dépôts et consignations.
The contents of the terms and conditions of sale are provided for on pain of nullity, so that the debtor must prove a grievance within the meaning of article 114 of the Code of Civil Procedure.
The pursuing creditor may attach to the schedule of conditions of sale any documents that he deems useful to bring to the attention of the purchasers. The schedule will be circulated to potential purchasers along with the documents, and will ultimately constitute the purchaser's title deed.
As a result, the property diagnostic file, lease contract, dated statement, town planning information, town planning certificate, cadastral matrix, co-ownership regulations, descriptive statement of division and its amendments, declaration of completion of works, etc. will generally be attached. All of this information will give potential bidders a better idea of what the property is like, so that they can buy on the best possible terms.
The terms and conditions of sale may also provide for the debtor to remain in the premises: "Unless the terms and conditions of sale provide for the distrainee debtor to remain on the premises, the successful bidder may enforce the eviction order that he has against the distrainee and any of his occupants who do not have any rights enforceable against him from the time the price is paid or deposited and the taxed costs are paid. (article R. 322-64 of the French Code of Civil Enforcement Procedures).
In addition, the terms and conditions of sale must mention the summons to pay in the form of a seizure and its publication, i.e. its publication references, which will appear on the publication statement ordered when it is published as follows:
The publication reference will therefore correspond to the provisional archive number preceded by the year (no. 2019 S 00024 in the above example).
Judicial sales are the only subject to be dealt with specifically in article 12 of the National Rules of Procedure for the Legal Profession.
Article 12 comprises two sub-articles, 12.1 and 12.2, devoted respectively to the lawyer of the pursuing creditor and the lawyer of the successful bidder (who will not be of interest to us here).
Article 12.1 states that "A lawyer called upon to draw up a schedule of conditions of sale (seizure of property) or a schedule of charges and conditions of sale (auction), or in matters of judicial liquidation, with a view to its filing with the registry, must use the standard clauses annexed hereto, which are general provisions for these deeds, subject to any modification that may be required by a particularity relating to the nature of the case, the status of the parties or the situation of the property.
The standard clauses referred to constitute the general provisions of the conditions of sale.
As we have seen, the schedule of conditions of sale had no normative value until the publication in the Official Journal on 7 March 2019 of the Decision of 13 February 2019 reforming the CNB's national rules of procedure for the legal profession.
This decision expressly mentions article 12.2 of the RIN and the three sets of terms and conditions of sale, devoted respectively to the terms and conditions of sale on seizure of real estate, on licitation-sharing and on judicial liquidation. However, it does not mention article 12.1 of the RIN, which consequently has no normative value.
In this context, it would seem that non-compliance with the standard clauses, unjustified by a particularity relating to the nature of the case, the status of the parties or the situation of the assets, is a matter for disciplinary proceedings before the President of the Bar Association.
The evolution and duration of the procedure may lead the pursuing creditor to add new documents to the terms and conditions of sale. For example, the technical diagnostic file may need to be updated if it was drawn up early in the procedure and the diagnostics whose validity is limited to 6 months have expired or will expire on the day of the auction; or the dated statement may need to be drawn up in the weeks preceding the sale; etc.
Under the old text, the legislator had therefore provided for the possibility of attaching new documents to the book, by means of a Dire au cahier des conditions de vente. For some reason, these provisions were not renewed when the procedure was reformed by the Order of 21 April 2006. As these provisions met a very real practical need, the practice continued, but this time without a legal framework.
Terminology has therefore evolved according to local traditions. For example, depending on the jurisdiction, one may speak of a Dire au cahier des conditions de la vente or an Additif au cahier des conditions de la vente.
Some enforcement judges have finally got to grips with the problem and now ask the lawyers for the pursuing creditors to request the addition of new documents by means of supplementary pleadings. These submissions are then expressly referred to in the auction judgement, so that they can be added to the book of documents under the cover of res judicata. Unlike traditional incidental submissions, they do not give rise to any hearing and are not dealt with by any judgment; they will simply be referred to in the adjudication judgment, as mentioned above.
The schedule of conditions of sale will become the title deed when, at the end of the auction hearing, the execution judge attaches to it the receipt for payment of the taxed costs, and the auction judgement (cf. infra). Candidates for the auction will therefore be able to consult it at the registry and at the office of the pursuing creditor's lawyer: "It may be consulted at the registry of the enforcement judge or at the office of the pursuing creditor's lawyer. (article R. 322-11, paragraph 2, of the Code of Civil Enforcement Procedures).
The pursuing creditor's lawyer and the registry will allow the public to consult the conditions of sale during their opening hours.
In practice, the text does not provide for any penalties for lawyers who do not allow the public to consult the conditions of sale. In practice, consultation at the lawyer's chambers has all but disappeared, in favour of dematerialised consultation of the booklet, which is available on the lawyer's website or on specialised websites. These include the www.licitor.comwhich has set up a partnership with the Paris Bar Association, or the website www.avoventes.frwhich was set up by the Conseil national des barreaux.
Any interested party will have the opportunity to contest the stipulations of the specifications: "Subject to the provisions of article L. 322-6 relating to the amount of the reserve price, the stipulations of the sales conditions book may be contested by any interested party. (article R. 322-11, paragraph 3, of the Code of Civil Enforcement Procedures).
Article L. 322-6 referred to concerns the debtor's challenge to the amount of the reserve price. As a result, interested parties may challenge all of the provisions of the terms and conditions of sale, with the exception of the reserve price, which may only be challenged by the debtor.
The expression "the stipulations of the conditions of sale". is a remainder. As we have seen, the schedule of conditions of sale had no normative value until the publication in the Official Journal of 7 March 2019 of the Decision of 13 February 2019 reforming the CNB's national rules of procedure for the legal profession, which includes in an appendix the general provisions to be appended to the schedule.
It's also worth noting that we're talking about general provisions, not stipulations in the terms and conditions of sale. This is completely inconsistent because, as we know, the contract stipulates, whereas the law provides.
The deadline for filing a claim and the documents to be attached to it vary depending on the date on which the mortgage registration was published.
Article R. 322-12 of the French Code of Civil Enforcement Procedures states that "The period within which a registered creditor who has been notified of a summons to pay equivalent to a seizure must declare his claim is two months from the date of notification.
However, a creditor who can prove that his default is not due to his own fault may ask to be authorised to declare his claim after the time limit has expired. The judge shall rule by order on the application, which shall be filed, failing which it shall be inadmissible, no later than fifteen days before the date set for the auction hearing or the hearing to establish the out-of-court sale.
Article R. 322-7 4° of the Code of Civil Enforcement Procedures states that "4° A summons to declare the debts registered on the seized property, in principal, costs and accrued interest, with an indication of the rate of default interest, by a lawyer's deed filed at the registry of the enforcement judge and accompanied by a copy of the debt deed and the registration slip, and to notify the pursuing creditor and the debtor of this declaration on the same day or the first working day following, in the same form or by service;".
The registered creditor thus has a period of 2 months from the date of notification of the summons to pay for the seizure of the property and the summons to appear at the orientation hearing issued by the pursuing creditor.
The creditor may ask the enforcement judge, by way of a petition, to authorise him to declare his claim after the time limit if he can prove that his default is not due to his own fault. This request must be filed, failing which it will be inadmissible, no later than 15 days before the date set for the adjudication hearing or the hearing to establish the out-of-court sale.
The claim shall be declared in principal, costs and accrued interest, with an indication of the rate of default interest, by a lawyer's deed filed with the clerk of the auction registry, accompanied by :
The statement of claim must be notified on the same day or on the first working day thereafter to the pursuing creditor and the debtor, by legal document or by service.
In practice, the document will be notified to the creditor's lawyer and to the debtor if he or she has instructed a lawyer; otherwise, it will be notified to the debtor by service of process.
Caution! Article R. 322-13 of the Code of Civil Enforcement Procedures, relating to the intervention in the proceedings by a creditor registered after publication of the summons, provides that the pursuing creditor must "intervenes in the procedure by declaring its claim. It is therefore traditionally considered that the declaration of claim is equivalent to constitution.
This provision is not repeated in the texts relating to creditors registered prior to publication of the summons. As this is clearly an omission on the part of the legislator, it is generally accepted that the declaration of claim also constitutes a constitution for the creditor registered prior to publication of the summons.
However, it is possible to serve, together with the statement of claim, a deed of constitution to which will be attached a summons to communicate the documents in the writ. This solution is preferable given the vagueness of the text, and insofar as the statement of claim per se does not include a summons to produce the documents.
Article R. 322-13 of the French Code of Civil Enforcement Procedures states that "Creditors who have registered their security interest in the property after publication of the summons to pay equivalent to a seizure but before publication of the sale, intervene in the proceedings by declaring their claim, based on the principal, costs and interest accrued to the date of the declaration. On pain of inadmissibility, the declaration shall be made by a lawyer's deed filed at the registry of the enforcement judge within one month of registration and shall be accompanied by a copy of the debt instrument and the registration slip and a mortgage statement surveyed on the date of registration. The declaration is notified to the pursuing creditor and the debtor in the same manner or by service on the same day or on the first working day thereafter.
A creditor who publishes a mortgage registration after publication of the summons to pay for the seizure, but before publication of the sale, has 1 month from publication of the registration to intervene in the proceedings by declaring his claim.
The procedures for declaring the claim are the same as for creditors registered prior to the publication of the summons to pay in the form of a seizure, subject to the filing at the registry, in addition to the copy of the writ of execution and the publication slip, of a mortgage statement surveyed on the date of registration.
The original copy, bearing the publication form, may be returned several months after it has been filed with the Land Registry. For this reason, the person responsible for publication will systematically draw up a mortgage statement at the date of registration, in order to know the publication references and to identify any proceedings in progress.
A registered creditor who fails to declare his claim within the prescribed time period loses the benefit of his mortgage rank and is demoted to unsecured rank. He is therefore entitled to participate in the proceedings.
The conditions and time limits within which the claim declaration may be contested depend essentially on article R. 311-5 of the Code of Civil Enforcement Procedures, which states that : "Unless otherwise stipulated, no challenge or incidental claim may be lodged after the orientation hearing provided for in article R. 322-15, unless it relates to procedural documents issued after that hearing, in which case the challenge or incidental claim must be lodged within fifteen days of notification of the document. In this case, the challenge or incidental claim must be lodged within fifteen days of notification of the document.
Thus, if the statement of claim is notified when the case has not been referred, it must be contested at the referral hearing; if it was filed after the referral judgment was handed down, it must be contested by way of incidental submissions within 15 days of notification.
Case law confirms this unambiguously.
With regard to the enforcement judge's obligation to rule on the dispute relating to the statement of claim during the orientation hearing, it states: "The enforcement judge is required to rule on disputes relating to the validity of the debtor's statement of claim raised during the orientation hearing. (Cass. opinion, 16 May 2008, no. 08-00.002, published in the Bulletin).
If the statement of claim was made prior to the referral judgment, the dispute cannot be formalised after this hearing, pursuant to the aforementioned Article R. 311-5, which has been amply confirmed by case law:
In the case of a claim lodged after the referral decision, the same rules require that the claim be formalised within the fortnight following notification.
First of all, it should be noted that the Code of Civil Enforcement Procedures never uses the expression "incidental hearing". However, this terminology is used by the author of these lines to easily distinguish the referral hearing from hearings held after the referral judgment, and which in particular follow the filing of incidental pleadings (article R. 311-6, paragraph 1, of the Code of Civil Enforcement Procedures).
The limits of this solution are well understood, since the text distinguishes between disputes and incidental claims (article R. 311-6, paragraph 3, of the Code of Civil Enforcement Procedures) and the referral judgment may therefore rule on incidental claims. Conversely, a judgement that is neither a referral judgement nor an adjudication judgement may rule on both disputes and incidental claims.
Expressions "incidental judgment and "incident hearing are, in this respect, imperfect since they do not adequately reflect the scope of intervention of the enforcement judge. Subject to these reservations, they will nevertheless be used.
Article L. 213-6 of the Code de l'organisation judiciaire states that "The enforcement judge has exclusive jurisdiction over difficulties relating to enforceable titles and disputes arising in connection with enforcement, even if they concern the substance of the law, unless they fall outside the jurisdiction of the courts.
Under the same conditions, it authorises precautionary measures and hears disputes relating to their implementation.
The enforcement judge has jurisdiction, subject to the same reservation, over the seizure of property procedure, disputes arising in connection therewith and claims arising from or directly related to this procedure, even if they relate to the substance of the law, as well as the resulting distribution procedure.
Subject to the same proviso, it hears claims for compensation based on the wrongful execution or non-execution of enforcement measures or precautionary measures.
The enforcement judge shall also exercise the specific powers conferred on him by the Code of Civil Enforcement Procedures.
In the case of seizures of immovable property, the enforcement judge is responsible for :
In practice, there are two possible scenarios:
The court must review compliance with obligations arising from the Code of Civil Enforcement Procedures and the public policy provisions of the Consumer Code.
Article R. 322-15, paragraph 1, of the Code of Civil Enforcement Procedures requires the enforcement judge to check ex officio that the conditions for seizure have been met: "At the orientation hearing, the enforcement judge, after hearing the parties present or represented, verifies that the conditions of articles L. 311-2, L. 311-4 and L. 311-6 have been met, rules on any disputes and incidental claims and determines how the proceedings are to continue, by authorising an out-of-court sale at the request of the debtor or ordering a compulsory sale.
Article L. 311-2 states that "Any creditor in possession of a writ of execution recording a claim that is due and payable may seize property under the conditions laid down by this Book and by the provisions of Book I that do not conflict with it.
Article L. 311-4 states that "Where proceedings have been commenced by virtue of a provisionally enforceable court decision, the compulsory sale may only take place after a final decision has become res judicata.
However, during the opposition period, no proceedings may be instituted by virtue of a decision rendered in absentia.
Finally, Article L. 311-6 states that "Unless there are specific legislative provisions, the seizure of property may relate to all rights in rem in respect of immovable property, including accessories deemed to be immovable property, which may be the subject of an assignment.
The enforcement judge verifies that the conditions of articles L. 311-2, L. 311-4 and L. 311-6 have been met, i.e. :
Consequently, the pursuing creditor's lawyer will have to attach to his file all the documents enabling the judge to carry out his duties, and in particular :
The Court of Cassation considers that the enforcement judge must, of his own motion, identify breaches of the public policy provisions of the Consumer Code.
There have been significant developments in case law in this area in recent years.
Firstly, the Cour de cassation quashed a judgment in which the Court of Appeal had failed to declare of its own motion that an anatocism clause was null and void. The specificity of the case lay in the fact that the plea had not been raised either before the enforcement judge or before the court of appeal, and that the court of cassation had taken it up of its own motion: "Having regard to article L. 312-23 of the French Consumer Code, together with article 1154 of the French Civil Code ;
Whereas the rule laid down by the first of these texts, according to which no indemnity or cost other than those mentioned in articles L. 312-21 and L. 312-22 of the Consumer Code may be charged to the borrower in the event of early repayment or default as provided for in those articles, precludes the application of the capitalisation of interest provided for in the second of the above-mentioned texts;
Whereas, in setting the Caisse's claim under the disputed loan at a certain sum, the judgment held that the lender had correctly increased the amount of the unpaid instalments due by the late interest accrued on them;
In so ruling, the Court of Appeal violated the aforementioned texts, the first by refusing to apply them, the second by misapplying them;
FOR THESE REASONS, and without it being necessary to rule on the second part of the second plea:
REVERSES AND ANNULS, but only insofar as it sets the Caisse's claim in respect of the disputed loan at the sum of 151,961.11 euros, the judgment of the Poitiers Court of Appeal of 11 October 2013 between the parties; consequently, on this point, restores the case and the parties to the status they were in before the said judgment and, for the purposes of the law, refers them back to the Limoges Court of Appeal;" (Cass. 1st civ., 17 June 2015, no. 14-11.807).
In a more recent judgment, it therefore logically considered that the general principle of concentration of pleas, and that the principle of temporal concentration applied to appeal proceedings alone, did not prevent the court from dealing of its own motion with the plea alleging infringement of the public policy provisions of the Consumer Code: "the principle of the temporal concentration of claims laid down by the third of those provisions does not preclude an examination of the unfairness of a contractual term by the national court of its own motion, which is obliged to do so if it has the necessary legal and factual information to do so.
In response to a question referred for a preliminary ruling by an Italian enforcement court, the Court of Justice of the European Union was asked whether Articles 6 and 7 of Directive 93/13/EEC and Article 47 of the [Charter] preclude national legislation which would prevent the enforcement court, on the one hand, from carrying out an intrinsic review of the enforceable title which has become res judicata, and, secondly, in the event of an expression of intention by the consumer to rely on the unfairness of the term contained in the contract on the basis of which the enforcement order was obtained, to set aside the effects of res judicata (CJEU, No C-693/19, Judgment of the Court, SPV Project 1503 Srl and Dobank SpA v YB and Banco di Desio e della Brianza SpA and Others v YX and ZWB, Judgment of the Court, SPV Project 1503 Srl and Dobank SpA v YB and Banco di Desio e della Brianza SpA and Others v YX and ZWB, Judgment of the Court, SPV Project 1503 Srl and Dobank SpA v YB and ZWB).a. v YX and ZW, 17 May 2022).
After a lengthy analysis of existing Italian law, the principles underlying res judicata and the imperatives of consumer protection, the Court ruled that the legislation was contrary to Directive 93/13 and prevented the enforcement judge from reviewing the possible unfairness of the contractual terms that served as the basis for the unopposed res judicata order for payment.
Since then, the Court of Cassation has consistently held that res judicata does not in itself prevent the national court from assessing, at the request of the parties or of its own motion, whether a term is unfair, even at the stage of compulsory enforcement (Cass. com., 8 Dec. 2021, no. 21-17.763; Cass. 2e civ., 13 Apr. 2023, no. 21-14.540, published in the Bulletin).
Article R. 311-4 of the Code of Civil Enforcement Procedures states that "Unless otherwise stipulated, the parties are obliged to constitute a lawyer.
Article R. 311-6 sets out the terms and conditions of the lawyer's involvement: "Unless otherwise stipulated, any challenge or incidental claim shall be lodged with the court clerk's office by means of submissions signed by a lawyer.
The communication of pleadings and documents between lawyers is carried out in accordance with the conditions set out in Article 815 of the Code of Civil Procedure. The summons is served on the debtor who has not constituted a lawyer.
If the challenge or incidental claim cannot be examined at the orientation hearing, the court clerk's office will summon the parties to a hearing by registered letter with acknowledgement of receipt within fifteen days of the challenge or claim being lodged.
The examination of challenges and incidental claims does not suspend the course of the proceedings.
In this respect, the summons to the orientation hearing includes a number of important points: "In addition to the information required by Article 56 of the Code of Civil Procedure, the writ of summons shall include, on pain of nullity :
[...]
3° Information that, if the debtor is not present or represented by a lawyer at the hearing, the proceedings will be continued as a forced sale, on the sole basis of the information provided by the creditor;
[...]
6° A warning that the debtor may ask the execution judge to be authorised to sell the seized property out of court if he can prove that a non-judicial sale can be concluded under satisfactory conditions;
7° An indication, in very conspicuous characters, that on pain of inadmissibility, any challenge or incidental claim must be filed with the enforcement judge's registry by way of a lawyer's submission no later than the time of the hearing;". (article R. 322-5 of the French Code of Civil Enforcement Procedures).
The debtor must constitute a lawyer in order to lodge objections or incidental claims. These submissions must be served in the form of notifications between lawyers, in accordance with article 815 of the Code of Civil Procedure. They will therefore be served either by RPVA or by a document served at the court registry, before being delivered to the court registry, in accordance with the aforementioned article R. 311-6.
If the debtor has not set up a lawyer, the summons will be served on him by bailiff.
Registered creditors intervene in the proceedings by declaring their claims through a lawyer, so that only the debtor is likely not to constitute a lawyer.
For the record, there is no multi-postulation in property seizures, so all the parties must appoint a lawyer registered with the bar of the court hearing the case.
Article R. 322-17 of the Code of Civil Enforcement Procedures authorises the debtor to submit an application for out-of-court sale on his own: "The debtor's request for authorisation of the amicable sale of the property, as well as the acts subsequent to this sale, do not require the assistance of a lawyer. This request may be made orally at the orientation hearing.
It is compulsory for the debtor to appoint a lawyer, unless he is applying for an out-of-court sale. The text favours amicable sale to the detriment of forced sale in order to encourage it.
For the record, the second paragraph of Article R. 322-15 of the French Code of Civil Enforcement Procedures states that : "When authorising an out-of-court sale, the judge shall ensure that it can be concluded under satisfactory conditions, taking into account the situation of the property, the economic conditions of the market and any diligence on the part of the debtor.
The application for an out-of-court sale will therefore be checked not only by the pursuing creditor, but also by the enforcement judge. In practice, either the debtor submits a provisional sale agreement, or the debtor submits a mandate to sell. In both cases, the pursuing creditor will check that the sale price or the amount of the mandate is consistent and that the debtor is not selling the property at a low price.
The enforcement judge may, of course, postpone the case to a later date so that the pursuing creditor can analyse the documents submitted by the debtor.
Article R. 322-15 of the French Code of Civil Enforcement Procedures states that "At the orientation hearing, the enforcement judge, after hearing the parties present or represented, verifies that the conditions of articles L. 311-2, L. 311-4 and L. 311-6 have been met, rules on any disputes and incidental claims and determines how the proceedings are to be pursued, by authorising an out-of-court sale at the request of the debtor or ordering a compulsory sale.
When authorising an out-of-court sale, the judge shall ensure that it can be concluded under satisfactory conditions, taking into account the situation of the property, the economic conditions of the market and any diligence on the part of the debtor.
Although it is impossible to draw up an exhaustive list of disputes and incidental claims that may be raised at the orientation hearing, there are obviously recurring claims and situations.
The debtor's request for an amicable sale is governed by the provisions of article R. 322-15 of the Code of Civil Enforcement Procedures: "At the orientation hearing, the enforcement judge, after hearing the parties present or represented, verifies that the conditions of articles L. 311-2, L. 311-4 and L. 311-6 have been met, rules on any disputes and incidental claims and determines how the proceedings are to be pursued, by authorising an out-of-court sale at the request of the debtor or ordering a compulsory sale.
When authorising an out-of-court sale, the judge shall ensure that it can be concluded under satisfactory conditions, taking into account the situation of the property, the economic conditions of the market and any diligence on the part of the debtor.
The debtor may apply for an out-of-court sale without legal representation. The judge will ensure that the sale can be concluded under satisfactory conditions, i.e. the debtor's request for an out-of-court sale must be accompanied by documents demonstrating both the seriousness of his commitment and the accuracy of his assessment of the value of the property.
In practice, it will be sufficient to produce one or more mandates to sell in order to have an appraisal of the property on file, in a document confirming the intention to sell.
First of all, the decision to accept the application to process the overindebtedness suspends and prohibits enforcement measures: "The admissibility of the application suspends and prohibits enforcement proceedings against the debtor's assets and assignments of remuneration granted by the debtor in respect of debts other than maintenance debts. (article L. 722-2 of the French Consumer Code).
This suspension and ban may not exceed two years (article L. 722-3, paragraph 2, of the Consumer Code).
If the debtor needs to obtain a suspension or prohibition of proceedings between the filing of the application and the decision on admissibility, he or she may submit an application to the Commission to this effect under Article L. 721-4 of the Consumer Code : "At the debtor's request, the commission may refer the matter to the magistrate of the tribunal d'instance, from the time the application is lodged until the decision is taken on the admissibility of the application to deal with the situation of over-indebtedness, with a view to suspending enforcement proceedings against the debtor's assets and assignments of remuneration granted by the debtor and relating to debts other than maintenance debts.
In urgent cases, the matter may be referred to the judge on the initiative of the Chairman of the Commission, his delegate or the local representative of the Banque de France. The committee is then informed of the referral.
If the Litigation and Protection Judge issues a decision to suspend proceedings when the Enforcement Judge has not yet ruled on the case, then the res judicata effect of his decision will be binding on the Enforcement Judge, who will have to suspend proceedings.
However, the debtor will have to apply to the court for a stay of proceedings, and this will necessarily be an incidental application to be made by way of submissions, which presupposes the involvement of a lawyer.
In practice, the length of time it takes for the case to be dealt with by the protection litigation judge means that these provisions are of no practical use. Indeed, it will be much simpler to request a postponement of the referral hearing pending the admissibility decision. In practice, moreover, the creditor and the judge will not necessarily be opposed to this, because as soon as the debtor owns a property, the over-indebtedness commission will certainly order a 2-year moratorium and ask the debtor to put the property up for sale. In this respect, seizure and overindebtedness will have the same effects, since they will both result in the sale of the property. The only difference will be in the conditions of sale, since in the case of over-indebtedness, the commission may order an interest freeze and grant the debtor a longer period in which to sell than the execution judge.
If urgent, the chairman of the committee may refer the matter directly to the enforcement judge. This is what the provisions of article R. 322-16 of the Code of Civil Enforcement Procedures refer to: "Article R. 322-16 of the Code of Civil Enforcement Procedures states that "The application to suspend the property seizure procedure on the grounds that the debtor is over-indebted is made in accordance with the provisions of Article L. 721-4 of the Consumer Code, under the conditions set out in Article R. 721-5 of that Code.
Article R. 721-5 sets out the procedures for referral to the court by the commission: "The letter by which the commission refers the matter to the court pursuant to the first paragraph of article L. 721-4 shall state the full name and address of the debtor and those of the pursuing creditors or, in the case of legal entities, their name and registered office. Attached to this letter is a statement of the debtor's income, a statement of the assets and liabilities of his assets and a list of the enforcement proceedings brought against his property, the assignments of remuneration that he has agreed to and the measures that he has taken to enforce his rights. of eviction from their home, drawn up using the documents available to the commission. A copy of the legal proceedings on which the application is based is also attached to this letter.
A request to suspend the foreclosure procedure may be submitted by the commission to the enforcement judge from the time the file is submitted until the decision on admissibility is made.
Once the admissibility decision has been taken, proceedings are automatically suspended.
Article L. 111-7 of the French Code of Civil Enforcement Procedures states that "The creditor has a choice of measures to ensure the performance or preservation of his claim. The execution of these measures may not exceed what is necessary to obtain payment of the obligation.
Article L. 121-2 of the Code of Civil Enforcement Procedures adds that "The enforcement judge has the power to order the release of any unnecessary or abusive measure and to order the creditor to pay damages in the event of abuse of seizure.
Article L. 121-2 mentions two criteria: uselessness and abuse.
On the subject of uselessness, case law teaches us that a court of appeal that orders the release of the seizure of real estate on grounds that are inadequate to characterise the uselessness of the seizure and that do not provide a legal basis for its decision holds, on adopted grounds, that the debt that was being enforced was modest in relation to the value of the seized property, that a cheque for €1,000,00 proposed by the distrainee had been deposited in a CARPA account after the distrainor had refused to collect it, that the distrainee's rental property generated a monthly rent of €736.58, which, sequestered in a CARPA account after opposition by the pursuing creditor, could subsequently give rise to an attachment order, and that the causes of the lawsuit could be settled in about ten months, so that the attachment of the property was unnecessary (Civ. 2, 22 June 2017, no. 16-16.871).
As for abuse, the Aix-en-Provence Court of Appeal ruled that : "Judging that a seizure of real property is excessive, given the small amount of the sum to be recovered, the possibility of seizing sums of money and the fact that the auction, if ordered, would not enable the plaintiff syndicate to recover its debt, and judging that such a seizure is both pointless and abusive, so that there is no reason to order the forced sale of the property and that the law should be applied". the aforementioned Article L. 111-7 (Aix-en-Provence Court of Appeal, 15 June 2009).
This case law repeated by other courts of appeal (see e.g. Agen Court of Appeal, 19 June 2012, no. 12/00688) makes it possible to identify the criteria for abuse:
Article L. 321-6, paragraph 1, of the Code of Civil Enforcement Procedures authorises the debtor to request that the seizure be confined: "In the event of the simultaneous seizure of several of the debtor's properties, the debtor may ask the court to limit the seizures.
Article R. 321-12, paragraph 1, of the Code of Civil Enforcement Procedures adds that "The enforcement judge shall grant the debtor's request that the effects of the seizure be provisionally confined to one or more of his immovable properties where he establishes that the value of these properties is sufficient to pay off the pursuing creditor and the registered creditors. The judgment indicates the properties on which proceedings are temporarily suspended. After the final sale, the creditor may resume proceedings on the property thus excepted if the price of the property sold is not sufficient to satisfy the creditor.
The debtor may request that the seizure be confined to several properties, one of which would be sufficient to pay off the pursuing creditor and the registered creditors.
A stay of proceedings within the meaning of Article 378 of the Code of Civil Procedure: "A stay of proceedings shall suspend the course of the proceedings for the time or until the occurrence of the event that it determines.
The request for a cantonment will therefore be submitted in limine litisin accordance with articles 73 and 74 of the Code of Civil Procedure.
Article L. 321-6, paragraph 2, of the French Code of Civil Enforcement Procedures states that the debtor shall " [...] may also apply to the court for a partial conversion of the seizures into a mortgage on some of its immovable property, which will rank on the date of publication of the seizure, subject to registration of the security interest within one month of notification of the decision.
Article R. 321-12, paragraph 2, of the Code des procédures civiles d'exécution completes : "When, under the same conditions, the court orders the cancellation of the seizure on the properties initially seized that it designates and the registration of a judicial mortgage, the pursuing creditor, in order to see the registration take precedence on the date of publication of the summons to pay in the form of a seizure, has the judgment published in the margin of the copy of the summons and the mortgage registered, under the conditions of ordinary law.
The debtor may also request that the seizure be converted into a judicial mortgage when it concerns several properties and one of them would be sufficient to pay off the pursuing creditor and the registered creditors.
In this case, the mortgage will rank on the date of publication of the summons to pay for the seizure of the property, provided that the registration is published within one month of notification of the decision. The mortgage is registered in accordance with the rules of ordinary law.
In addition, the judgment will order the cancellation of the summons and, consequently, the stay of proceedings will be published in the margin of the said summons.
Publication should be requested by sending the original and a copy of the deed to be published, together with certification of the identity of the parties and, if necessary, a request for a statement of formalities (CERFA no. 3233-SD), to the relevant land registry, together with a cheque made payable to Treasury in the amount of :
Article R. 322-5 of the Code of Civil Enforcement Procedures states that "In addition to the information required by Article 56 of the Code of Civil Procedure, the writ of summons shall include, on pain of nullity :
[...]
5° An indication of the upset price as set out in the conditions of sale and the possibility of contesting the amount on the grounds of manifest inadequacy;".
The summons for the orientation hearing will include an indication of the upset price set in the terms and conditions of sale, which the debtor may contest at the orientation hearing: "The debtor may, in the event of a manifest inadequacy in the amount of the reserve price, apply to the court to have a reserve price set in relation to the market value of the property and market conditions. However, in the absence of a bid, the debtor may only be declared the successful bidder for the initial reserve price. (article L. 322-6, paragraph 2, of the Code of Civil Enforcement Procedures).
The debtor must demonstrate that the upset price is manifestly insufficient. The penalty for failing to hold an auction may be for the pursuing creditor to set a low bid, which the debtor may criticise. If this is the case, the debtor will have to show that the upset price is lower than the market price.
However, setting a low bid remains a protective solution for the pursuing creditor whose claim is small, insofar as, in the absence of a bid, it will be declared the winning bidder for the amount of the initial bid.
The period of grace may be granted by the enforcement judge.
Article 510 of the Code of Civil Procedure states that "Subject to the following paragraphs, the period of grace may only be granted by the decision whose enforcement it is intended to defer.
In urgent cases, the interim relief judge has the same power.
After service of a summons or a writ of attachment, as the case may be, the enforcement judge has the power to grant a period of grace. The tribunal d'instance has this jurisdiction in the case of attachment of earnings.
Reasons must be given for granting the extension.
The debtor will not be able to request a period of grace if he is in compulsory liquidation, or if he has reduced the guarantees that he had given by contract to his creditor: "The period of grace may not be granted to a debtor whose assets have been seized by other creditors or to a debtor who is in the process of legal settlement or liquidation of assets, or who has, by his own act, reduced the guarantees he had given to his creditor by contract.
In the same cases, the debtor loses the benefit of any period of grace he may have previously obtained. (article 512 of the Code of Civil Procedure).
Alternatively, the debtor may apply to the court on the merits for a period of grace based on the provisions of Article 1343-5 of the Civil Code: "The judge may, taking into account the situation of the debtor and the needs of the creditor, defer or stagger payment of the sums due, up to a maximum of two years.
By special reasoned decision, it may order that the sums corresponding to the deferred instalments shall bear interest at a reduced rate at least equal to the legal rate, or that the payments shall first be deducted from the capital.
It may make these measures conditional on the debtor performing acts to facilitate or guarantee payment of the debt.
The judge's decision suspends any enforcement proceedings initiated by the creditor. The interest increases or penalties provided for in the event of delay are not incurred during the period set by the judge.
Any stipulation to the contrary is deemed unwritten.
The provisions of this article shall not apply to maintenance debts.
If the trial judge grants the debtor a period of grace before the enforcement judge has ruled, then the res judicata effect of his decision will be binding on the enforcement judge, provided of course that the decision predates the referral judgment.
The request for referral is made orally at the orientation hearing.
The Cour de cassation specifies that this request for referral is admissible and that incidental claims must be lodged no later than the referral hearing (Civ. 2e23 October 2008, no. 08-13.404). Furthermore, the referral hearing does not necessarily have to take place within a maximum of 3 months from the date of the summons (Civ. 2e24 June 2010, no. 09-67.887).
Article R. 311-5 of the Code of Civil Enforcement Procedures states that "Unless otherwise stipulated, no challenge or incidental claim may be lodged after the orientation hearing provided for in article R. 322-15, unless it relates to procedural documents issued after that hearing, in which case the challenge or incidental claim must be lodged within fifteen days of notification of the document. In this case, the challenge or incidental claim must be lodged within fifteen days of notification of the document.
The referral judgment disposes of all disputes and incidental claims, unless they relate to actions taken after the referral hearing.
The Court of Cassation points out that the court of appeal must respond to the arguments of the pursuing creditor who raises the inadmissibility of the challenge presented for the first time in the appeal proceedings, in a case where the debtor was in default at the orientation hearing (Civ. 2e, 1e October 2009, no. 07-18.630).
The Court of Cassation also points out that the Court of Appeal must note of its own motion the inadmissibility of challenges and incidental claims presented for the first time in the appeal proceedings (Civ. 2eMarch 11, 2010, no. 09-13.312).
Nevertheless, the case law adds that the obligation for the parties to the property seizure proceedings to raise, on pain of inadmissibility, at the orientation hearing all challenges and incidental claims does not apply to third parties to the proceedings (Civ. 2, 4 December 2014, no. 13-24.870) : "Whereas to declare the voluntary intervention of the Caisse des dépôts et consignations inadmissible, the enforcement judge, after recalling the terms of article R. 311-5 of the Code of Civil Enforcement Proceedings, held that this text does not distinguish between disputes originating from a party or a third party, it being further stipulated that third party interveners cannot have more rights than the original parties to the proceedings, and that the plea of inadmissibility cannot be dismissed on grounds relating to the substance of the law, namely the contra legem nature, according to the intervener, of articles 13 and 14 of the disputed schedule of conditions of sale;
In so ruling, whereas the obligation on the parties to the property seizure proceedings to raise, on pain of inadmissibility, all disputes and incidental claims at the orientation hearing does not apply to third parties to the proceedings, the enforcement judge violated the aforementioned texts;".
At the orientation hearing, the enforcement judge may either authorise an out-of-court sale or order a sale by auction. In either case, the judgment will have common features.
As we have seen, article R. 322-15 of the Code of Civil Enforcement Procedures provides that "At the orientation hearing, the enforcement judge, after hearing the parties present or represented, verifies that the conditions of articles L. 311-2, L. 311-4 and L. 311-6 have been met, rules on any disputes and incidental claims and determines how the proceedings are to be pursued, by authorising an out-of-court sale at the request of the debtor or ordering a compulsory sale.
When authorising an out-of-court sale, the judge shall ensure that it can be concluded under satisfactory conditions, taking into account the situation of the property, the economic conditions of the market and any diligence on the part of the debtor.
Article R. 322-18 of the Code of Civil Enforcement Procedures adds that "The referral judgement shall state the amount of the claim of the the principal, costs, interest and other incidental expenses".
The judgment shall rule on any incidental claims, settle any disputes raised by the parties, determine how the proceedings are to be continued and state the amount of the claim in principal, costs, interest and other incidentals.
The use of the term " mentions " was the source of controversy in the legal literature until a series of rulings clarified the role of the judge. In fact, if the court merely mentions the amount of the claim, does this mention have the force of res judicata?
First of all, the Court of Cassation states that the enforcement judge must mention the amount of the claim without being bound by the amount appearing in the summons to pay for the seizure of property (Civ. 2e24 September 2015, no. 14-20.009).
Next, it states that the referral judgment, insofar as it sets the amount of the pursuing creditor's claim, is res judicata in the main proceedings, even if no dispute has been raised on this subject (Com., 13 September 2017, appeal no. 15-28.833).
Finally, in an opinion dated 12 April 2018 (request for opinion no. P 18-70.004, opinion no. 15008), issued at the request of the enforcement judge of the Poitiers tribunal de grande instance, the Second Civil Chamber first recalls that: "The enforcement judge rules as the judge in the main proceedings (article R. 121-14 of the Code of Civil Enforcement Procedures), and also rules on questions of legal substance (article L. 213-6 of the Code of Judicial Organisation), so that his decisions have the force of res judicata in the main proceedings, unless otherwise stipulated.
It therefore issues the following opinion: "In property seizures, in order to set the amount of the debtor's claim pursuant to article R. 322-18 of the Code of Civil Enforcement Procedures, the enforcement judge is required to verify that this amount is consistent with the statements in the enforcement order on which the proceedings are based, pursuant to the provisions of article R. 322-15 of the same code, whether or not the debtor disputes this amount.
If it is required to carry out this verification of its own motion, it shall also exercise, in its capacity as judge of the main proceedings, the powers conferred on it by the Code of Civil Procedure or by special provisions.
Mention of the quantum of the claim of the pursuing creditor is therefore indisputably res judicata.
Article R. 322-21 of the Code of Civil Enforcement Procedures states that "The enforcement judge who authorises the out-of-court sale sets the price below which the property may not be sold in view of the economic conditions of the market and, where applicable, the specific conditions of the sale.
The judge charges the costs of proceedings at the request of the pursuing creditor.
It sets the date of the hearing at which the case will be recalled within a period that may not exceed four months.
At this hearing, the judge may only grant additional time if the applicant can provide proof of a written commitment to purchase and to allow the deed of sale to be drawn up and concluded. This period may not exceed three months.
Article R. 322-20 of the Code of Civil Enforcement Procedures adds that "An application for the amicable sale of the property may be submitted and judged before service of the summons to appear at the orientation hearing, provided that the debtor brings into question the creditors registered on the property.
The decision granting the application suspends the course of the enforcement proceedings, with the exception of the period allowed for registered creditors to declare their claims.
The judgment authorising the out-of-court sale sets the price below which the property may not be sold.
In addition, the judge sets the date for a reminder hearing within a period that may not exceed 4 months. In practice, the debtor often has a longer period because the 4-month period is counted from the deliberation, which itself takes place several weeks after the pleadings hearing. At the reminder hearing, the debtor may again have a longer period for the same reasons.
This judgment suspends the course of the proceedings, whether or not the claim was made prior to the issue of the summons to the orientation hearing (Civ. 2e23 October 2008, no. 08-13.404).
The suspension of proceedings will result in the suspension of the time limit for expiry of the summons to pay valid as a seizure of property from the date of publication of the judgment on the margin of the summons, in accordance with article R. 321-22 of the French Code of Civil Enforcement Procedures, relating to the time limit for expiry of the summons to pay: "This period is suspended or extended, as appropriate, by a note in the margin of the copy of the published summons of a court decision ordering the suspension of enforcement proceedings, the postponement of the sale, the extension of the effects of the summons or the decision ordering the reopening of the auction.
Article R. 322-26 of the Code of Civil Enforcement Procedures states that "When the enforcement judge orders a forced sale, he sets the date of the hearing at which it will take place within a period of between two and four months from the date of his decision.
The judge shall determine the procedures for visiting the property at the request of the pursuing creditor.
The judge sets a date for the auction within a period of between +2 and +4 months from the date of deliberation, and authorises the inspection of the property in accordance with the terms set by the judge, for example within a fortnight of the sale and with the assistance of a bailiff, and if necessary with the assistance of the police and a locksmith.
Article R. 311-7, paragraph 2, of the Code of Civil Enforcement Procedures states that "Decisions are notified by service. However, when, by virtue of a specific provision, the enforcement judge rules by means of an order rendered at last instance, his decision is notified by the registry simultaneously to the parties and their lawyers. The same applies to notification of a decision to opt for an out-of-court sale where the debtor has not set up a lawyer and of decisions made pursuant to articles R. 311-11 and R. 321-21.
The referral judgement ordering the compulsory sale and the incidental judgements must be notified by way of service. However, the court registry will notify the parties and their lawyers by registered post of the settlement judgment ordering the out-of-court sale, the judgment declaring the summons to pay to lapse and the judgment declaring the summons to pay to lapse, in accordance with the provisions relating to the notification of documents in the ordinary form (Code of Civil Procedure, articles 665 and 670-3).
Article 80, 3°, of Decree no. 55-1350 of 14 October 1955 states that "The following shall be published in the form of a note in the margin of the copy of the order for seizure :
[...]
3° The referral judgment;".
There is no penalty for failing to publish the order, but it does inform third parties that the pursuing creditor has taken the necessary steps.
Publication should be requested by sending the original and a copy of the deed to be published, together with certification of the identity of the parties and, if necessary, a request for a statement of formalities (CERFA no. 3233-SD), to the relevant land registry, together with a cheque made payable to Treasury in the amount of :
Article R. 311-6, paragraph 3, of the Code of Civil Enforcement Procedures states that "If the challenge or incidental claim cannot be examined at the orientation hearing, the court clerk's office will summon the parties to a hearing by registered letter with acknowledgement of receipt within fifteen days of the challenge or claim being lodged.
The debtor may therefore present submissions to contest and incidental claims relating to acts subsequent to the orientation hearing, provided he does so within 15 days of their completion (Civ. 2e, 26 June 2014, no. 13-20.193), in accordance with article R. 311-5 of the Code of Civil Enforcement Procedures.
As a general rule, this will apply to :
Intervening submissions filed after the referral judgment will be examined at an intervening hearing to which the parties will be invited by registered letter with acknowledgement of receipt.
It should be noted that the referral judgment rules on incidental claims presented at the referral hearing.
The judgment handed down at the end of the incidental hearing will not be a referral judgment. This is because a referral judgment has special features, since it contains a series of mandatory statements. In addition, it makes it possible to establish the chronology of ante and post orientation, which determines the type of challenges that the debtor can raise.
On the other hand, it should be noted that the judgment subsequent to the referral judgment may also, in certain cases, order the forced sale of the property. In this case, the judgment will be similar in many respects to the referral judgment, although it will be an incidental judgment. Particular attention should be paid to the appeal procedure that may be used.
Article R. 311-7, paragraph 2, of the Code of Civil Enforcement Procedures states that "Decisions are notified by service. However, when, by virtue of a specific provision, the enforcement judge rules by means of an order rendered at last instance, his decision is notified by the registry simultaneously to the parties and their lawyers. The same applies to notification of a decision to opt for an out-of-court sale where the debtor has not set up a lawyer and of decisions made pursuant to articles R. 311-11 and R. 321-21.
The Registry shall notify the parties and their lawyers by registered letter of the incidental judgment that the summons has lapsed or expired.
Other judgements are served by the parties.
Article 80, 3°, of Decree no. 55-1350 of 14 October 1955 states that "The following shall be published in the form of a note in the margin of the copy of the order for seizure :
[...]
8° Generally speaking, the various procedural acts related to the order, such as subrogation in the proceedings, the judgment declaring the segregation of all or part of the seized immovables, etc.".
The text does not expressly provide for the publication of the judgment rendered following the filing of a statement of objections, but 8° of the aforementioned article gives a non-exhaustive list that appears to be exhaustive. in fine all documents relating to the procedure.
The procedures for publication of the judgement at the land registry will be the same as for the orientation judgement, i.e. :
Requests for diversion and subrogation are not subject to the 15-day time limit applicable to disputes arising after the initial judgment. They may be submitted at any time up until the sale of the seized property.
With regard to the application for diversion, first of all, article R. 311-8 of the Code of Civil Enforcement Procedures provides that "An application for diversion of all or part of the seized property may be made until the seized property is sold.
Distraction is a form of claim, in which a third party to the proceedings intervenes voluntarily by filing pleadings in which he claims to have the same right as the seized debtor to all or part of the seized property. Accordingly :
With regard to the request for subrogation, article R. 311-9 of the Code of Civil Enforcement Procedures provides that "Registered creditors and the creditors listed in article 2377 and 3° of article 2402 may, from the date of publication of the summons to pay for the seizure and at any time during the proceedings, apply to the enforcement judge to be subrogated to the rights of the pursuing creditor, by way of an incidental application or orally at the auction hearing.
Subrogation may be requested if the pursuing creditor withdraws or if there is negligence, fraud, collusion or any other cause of delay attributable to the pursuing creditor.
The decision rejecting the request for subrogation is not subject to appeal unless it terminates the proceedings.
Subrogation entails substitution in legal proceedings and in the rights and obligations set out in the terms and conditions of sale provided for in article R. 322-10.
The pursuing party against whom subrogation is ordered is required to hand over the documents relating to the proceedings to the subrogated party, who shall acknowledge receipt thereof. The pursuing party is not relieved of its obligations until such time as the documents are handed over to the subrogated party.
Registered creditors, the syndicate of co-owners and holders of one of the special liens listed in article 2375 of the Civil Code may request that they be subrogated in the rights of the pursuing creditor, if he withdraws or if he commits a fault, fraud, collusion or causes any delay whatsoever.
In practice, registered creditors will not be informed of any withdrawal by the claimant, unless they have declared their claim in the proceedings, and will only be able to be informed of the progress of the proceedings on the basis of a building sheet, which will show the published procedural acts (summons, summons, denunciation, orientation judgment, etc.).
The request for subrogation is normally (cf. infra) presented in the form of submissions.
A decision rejecting a request for subrogation is not subject to appeal, except in the event that it puts an end to the proceedings. The Court of Cassation has nevertheless ruled that a judgment declaring a subrogation claim inadmissible (and not rejected) may be appealed (Civ. 2e12 April 2012, no. 10-26.564).
Conversely, the decision granting the claim may be appealed in accordance with the usual procedure for property seizures.
The pursuing creditor remains responsible for the procedure until the documents are sent to the registered creditor, who is subrogated to its rights.
Lastly, there is nothing to prevent the registered creditor from lodging an action for subrogation after the summons to pay has been issued, but before the summons to the orientation hearing has been issued and the summons to pay has been served on the registered creditors. This situation is described in circular CIV/17/06 on pages 7 and 10: "While in principle the summons is issued by the creditor to the debtor to appear at the orientation hearing, a summons may be issued by other parties. For example, the debtor may take the initiative of referring the matter to the enforcement judge by writ of summons, in particular to obtain the release of the measure that he considers unfounded or the lapse of the summons, or to be authorised to sell his property out of court before the orientation hearing. Similarly, before the summons to appear at the orientation hearing is issued, a registered creditor may summon the pursuing creditor for the purposes of subrogation.
[...]
Requests for subrogation, whereby a registered creditor substitutes itself for the pursuing creditor, must be made possible at all stages of the proceedings, since they make it possible to penalise the pursuing creditor's failure to act diligently, and thus prevent the proceedings from lapsing. Article 10 of the decree sets out the conditions for this.
However, this is a textbook case. In practice, the registered creditor is informed of the existence of the proceedings as from the notification of the summons and the summons to the orientation hearing, so that, save in exceptional cases, he will not be able to submit a request for subrogation before the orientation hearing.
In a judgment dated 21 February 2019, published in the Bulletin, the Court of Cassation upheld the judgment of a court of appeal which had raised of its own motion the ground of inadmissibility of the appeal by the debtor who had lodged his appeal only against the pursuing creditor, to the exclusion of the registered creditors, invoking the principle of indivisibility of the dispute : "But whereas the Court of Appeal correctly held that in proceedings for the seizure of real property there is an indivisible link between all the creditors, so that pursuant to article 553 of the Code of Civil Procedure, an appeal by one of the parties to the proceedings before the execution judge, even if limited to contesting the claim of the pursuing creditor, must be brought against all the parties to the proceedings, failing which the appeal is inadmissible;". (Cass. 2e civ., 21 Feb. 2019, n° 17-31.350, Published in the bulletin).
This is a logical solution, as a challenge to the proceedings brought by the pursuing creditor directly affects the registered creditors, who are entitled to take part in the price distribution proceedings, or even to apply for subrogation in the rights of the pursuing creditor.
In a subsequent ruling, the Court of Cassation added that registered creditors who had not declared their claims in the proceedings should also be notified: "Having regard to articles 553 of the Code of Civil Procedure and R. 322-6 of the Code of Civil Enforcement Procedures :
This issue has not been decided on appeal in relation to oppositions to judgments. However, in a judgment dated 14 January 2021, the enforcement judge of the Créteil court handed down a particularly reasoned decision on this subject, in which he ruled that a formal opposition without the registered creditors being called upon was inadmissible on the grounds that the dispute was indivisible: " In accordance with Article 577 of the Code of Civil Procedure, the admissibility of the respective claims of the claimant and the opposing party in the new proceedings is assessed in relation to the original claim in accordance with the ordinary rules.
It is settled case law that, pursuant to article 553 of the Code of Civil Procedure, in a property seizure procedure, indivisibility applies to all creditors, pursuing or otherwise, so that an appeal by one of the parties to the proceedings before the execution judge must be made by a declaration of appeal directed against all the parties to those proceedings, including registered creditors who have not declared their claim, and regardless of whether the appeal is limited to certain heads of the operative part of the orientation judgment.
The opposition, like the appeal, has a devolutive effect: it puts the parties back in the situation they were in before the default judgment. (Tribunal judiciaire de Créteil, 14 January 2021, no. 20/00018).
The enforcement judge's reasoning can only be approved. Indeed, it is settled case law that opposition, like appeal, has a devolutive effect (Cass. civ., 2e, 7 June 2007, no. 06-17.507, published in the Bulletin), so that the analogy between the two procedures is relevant. To support this analogy, we note that article 584 of the Code of Civil Procedure, relating to third-party proceedings, provides that "In the event of indivisibility with regard to several parties to the contested judgment, the third-party proceedings shall only be admissible if all these parties are called to the proceedings.
In both cases, therefore, all registered creditors must be involved, including those who have not declared their claims in the proceedings.
Caution! In some cases, the pursuing creditor may also act as a registered creditor. Where this is the case, the pursuing creditor must bring his own action as a registered creditor, and the debtor must bring an action against him as both the pursuing creditor and the registered creditor.
Appeals may be lodged against the referral judgment and against the incidental judgment. However, the applicable procedures are different in each case.
Article R. 311-7, paragraph 1, of the Code of Civil Enforcement Procedures states that "Unless otherwise provided, judgements may be appealed. The appeal must be lodged within fifteen days of notification. Subject to the provisions of article R. 322-19 and unless a fixed date procedure is used, the appeal is heard in accordance with the procedure set out in article 905 of the Code of Civil Procedure".
Unless otherwise stipulated, appeals are possible.
The time limit for appeal is 15 days from notification of the judgement.
Article R. 121-21 of the French Code of Civil Enforcement Procedures states that "The time limit for appeal and the appeal itself have no suspensive effect.
The judgments of the enforcement judge are always subject to provisional enforcement.
Where there are serious grounds for setting aside or altering the decision referred to the court, it is necessary to apply to the first president of the court of appeal for a stay of provisional enforcement, in accordance with article R. 121-22 of the code of civil enforcement procedures, to which the second paragraph of article R. 322-19 of the same code refers.
Article R. 121-22 of the Code of Civil Enforcement Procedures states that "In the event of an appeal, a stay of execution of decisions taken by the enforcement judge may be requested from the First President of the Court of Appeal. The application is made by means of a summary proceedings summons delivered to the opposing party and notified, where applicable, to the third party in whose hands the seizure has been carried out.
The application for a stay of execution suspends the proceedings until the date on which the order is made by the First President, if the contested decision has not called into question the continuation of the proceedings; it extends the effects of the seizure and the precautionary measures if the contested decision has ordered the release of the measure.
A stay of execution is granted only if there are serious grounds for setting aside or altering the decision referred to the court.
The First President may order the author of a manifestly abusive application for a stay of execution to pay a civil fine of a maximum of €3,000, without prejudice to any damages that may be claimed.
To suspend provisional enforcement, it will therefore be necessary to bring an application for interim relief before the First President of the Court of Appeal.
The suspension of provisional enforcement runs from the date of service of the summons until the summary order. This suspension extends the effects of the summons to pay for the seizure of the property, and therefore the time limit for its expiry.
It should be noted that the procedure set out in article R. 121-22 of the Code of Civil Enforcement Procedures is exclusive of that set out in article 524 of the Code of Civil Procedure (CA Aix-en-Provence, 12 May 2011, no. 11/00205).
Appeals are limited to disputes previously submitted to the enforcement judge.
Applications made for the first time in the appeal proceedings, after the referral hearing, which do not relate to acts subsequent to the referral hearing, must be declared inadmissible ex officio (Civ. 1e11 March 2010, no. 09-13.312; Civ. 1e20 October 2011, no. 10-25.787).
Conversely, the court may be seised of acts subsequent to the orientation hearing (Civ. 2e12 April 2012, no. 11-14.817).
The devolutive effect also limits the scope of the appeal against the judgment authorising the out-of-court sale to the incident to be decided. Once the judgment has been handed down, the court must refer the case back to the enforcement judge, who alone has jurisdiction to continue the property seizure proceedings (Civ. 2e23 October 2008, no. 08-13.404, published in the Bulletin).
The appeal procedure differs depending on whether you are appealing against a referral judgment or an incidental judgment.
Firstly, article R. 322-19, paragraph 1, of the Code of Civil Enforcement Procedures states that "An appeal against a referral order shall be lodged, heard and determined in accordance with the fixed date procedure, without the appellant having to rely on a peril in his application.
The Court of Cassation does not simply consider that the appeal against the referral judgment is lodged, investigated and judged according to the fixed day procedure, but that all judgments handed down at the referral hearing fall under this procedure (Cass. civ., 2e, 25 Sept. 2014, no. 13-19.000, published in the Bulletin).
The appellant must file a motion to set a hearing date with the First President of the Court of Appeal.
This request must be made either before the appeal is lodged (articles 917 and 918 of the Code of Civil Procedure), or within 8 days of the appeal being lodged (article 919 of the Code of Civil Procedure), failing which the appeal will be inadmissible (Civ. 2e19 March 2015, no. 14-14.926). In both cases, the application must contain the submissions on the merits and refer to the supporting documents. A copy of the contested decision must be attached.
The paper application is submitted manually to the court registry. In fact, only procedural documents intended for the Court of Appeal must be submitted electronically (Article 930-1 of the Code of Civil Procedure and Civ. 2e7 December 2017, no. 16-19.336).
The appellant must then summon the opposing party on the date indicated in the order of the first president. This summons must include as attachments copies of the application, the order of the First President and a copy of the statement of appeal endorsed by the registry, failing which the appeal will be inadmissible (Civ. 2e27 September 2018, no. 17-21.833).
If the application was submitted prior to the statement of appeal, the copy of the statement of appeal attached to the writ of summons for a fixed date need not be endorsed by the court clerk's office.
The case will be referred to the court by delivering a copy of the summons to the clerk's office, which must be done before the date set for the hearing, failing which the statement of appeal will be declared null and void by the president of the chamber to which the case is assigned (article 922 of the Code of Civil Procedure).
An appeal against a referral decision under a different procedure constitutes a plea of inadmissibility, which the court must raise of its own motion (Civ. 2e, 22 February 2012, no. 10-24.410; Civ. 2e, 28 June 2012, no. 11-20.143).
If the execution judge has ordered the sale by auction, the court will have to give its ruling at least one month before the sale date: "Where an appeal is lodged against a judgment ordering a sale by auction, the court shall rule no later than one month before the date set for the auction. Failing this, the enforcement judge may, at the request of the pursuing creditor, postpone the date of the forced sale hearing. Where a stay of proceedings resulting from the application of article R. 121-22 prevents the auction hearing from being held on the scheduled date and the judgement ordering the auction has been confirmed on appeal, the date of the auction is set on request by order of the enforcement judge. No appeal shall lie from a decision of the enforcement judge made pursuant to this paragraph. (article R. 322-19, paragraph 2, of the Code of Civil Enforcement Procedures).
In practice, the case may be postponed to a hearing after the auction date. In this case, the text provides that the pursuing creditor may ask the enforcement judge to postpone the date of the auction hearing. This request is made by way of pleadings.
If the appellant has not initiated proceedings to suspend provisional enforcement, the guideline judgment ordering the compulsory sale must be enforced by the pursuing creditor, who will have to carry out the formalities of posting the notice. To avoid organising the sale while an appeal is pending, the pursuing creditor may request that the sale be postponed.
If, on the other hand, the distrainee debtor has applied to the First President for a stay of provisional enforcement, then enforcement of the referral judgment will be blocked as soon as the writ of summons is served and the pursuing creditor will have to interrupt, as from that date, the steps taken to achieve the sale.
In theory, the adjudication hearing cannot take place and the case will no longer be heard from that date. This is why the text provides for any resumption of proceedings to be requested by way of an order on the merits.
In practice, however, it is quite common for the enforcement judge to order the postponement of the adjudication hearing to a later date. When this solution is adopted, it is customary to order a postponement to a distant date, possibly after the date of deliberation if this is known, in order to minimise the number of steps to be taken to continue the proceedings.
This solution is not perfectly in line with the text, but it is nevertheless of obvious practical interest to all parties.
The incidental judgment, i.e. the judgment that was not handed down at the orientation hearing and that is not a judgment recording an amicable sale or auction, will be subject to appeal unless otherwise provided: "Unless otherwise provided, judgements are subject to appeal. The appeal shall be lodged within fifteen days of notification thereof. Subject to the provisions of article R. 322-19 and unless a fixed date procedure is used, the appeal is heard in accordance with the procedure set out in article 905 of the Code of Civil Procedure. (article R. 311-7, paragraph 1, of the Code of Civil Enforcement Procedures).
The case is therefore set down for hearing at short notice and the procedure is as set out in Articles 905 to 905-2 of the Code of Civil Procedure.
Article 905 of the Code of Civil Procedure states that "The president of the chamber hearing the case, of his own motion or at the request of a party, shall fix the days and times on which the case is to be called at short notice on the day indicated, where the appeal :
1° Appears to be of an urgent nature or to be ready for trial ;
2° Relates to a summary order ;
3° Relates to a judgment given under the accelerated procedure on the merits ;
4° Relates to one of the orders of the Pre-Trial Judge listed in 1° to 4° of Article 795 ;
5° Relates to a judgment ruling on a substantive issue during the pre-trial stage and a plea of inadmissibility pursuant to the ninth paragraph of Article 789.
In all cases, the procedure shall be as set out in Articles 778 and 779.
Article 905-1 of the Code of Civil Procedure then provides that "Where the case is set by the President of the Division within a short period of time, the appellant shall serve the statement of appeal within ten days of receipt of the notice of setting sent to him by the court registry, failing which the statement of appeal shall lapse, raised ex officio by the President of the Division or the magistrate designated by the First President; however, if, in the meantime, the respondent has constituted a lawyer before service of the statement of appeal, his lawyer shall be notified.
On pain of nullity, the writ of service shall indicate to the respondent that, if he fails to constitute a lawyer within a period of fifteen days from the date of service, he runs the risk of a judgment being rendered against him solely on the basis of the information provided by his adversary and that, if he fails to enter a pleading within the period referred to in article 905-2, he runs the risk of his pleadings being declared inadmissible ex officio.
Lastly, article 905-2 of the Code of Civil Procedure concludes that "On pain of the declaration of appeal lapsing, which may be raised ex officio by an order of the President of the Division hearing the case or of the magistrate designated by the First President, the appellant shall have a period of one month from receipt of the notice to set the case for hearing within a short period in which to submit his submissions to the court registry.
The respondent shall have a period of one month from the date of notification of the appellant's submissions, failing which it shall be deemed inadmissible by order of the President of the Chamber hearing the case or of the Judge designated by the First President, to submit its submissions to the Registry and, where appropriate, lodge a cross-appeal or an appeal.
The respondent to a cross-appeal or to an appeal in cassation shall have a period of one month from the date of notification of the cross-appeal or appeal in cassation, to which a copy of the notice of determination is attached, within which to submit its submissions to the court registry, failing which it shall be deemed inadmissible by order of the President of the Division hearing the case or of the Judge designated by the First President.
An intervener who is forced to intervene in the appeal proceedings shall have a period of one month from the date of notification of the application to intervene made against him, to which a copy of the notice of determination is attached, in which to submit his submissions to the Registry, failing which he shall be deemed inadmissible by order of the President of the Division hearing the case or of the Judge designated by the First President. Voluntary interveners have the same period, subject to the same penalty, from the date of their voluntary intervention.
The President of the Division to which the case is referred or the judge designated by the First President may, on his or her own initiative, by order, set shorter time limits than those provided for in the preceding paragraphs.
The orders of the President or of the judge designated by the First President of the Division seised of the case ruling on the inadmissibility of the appeal, on the lapse of the appeal or on the inadmissibility of the pleadings and procedural documents pursuant to this article and to article 930-1 shall be res judicata in the main proceedings.
Article L. 322-1 of the Code of Civil Enforcement Procedures states that "The assets are sold either out of court by judicial authorisation or by auction.
In the event of an agreement between the debtor, the pursuing creditor, the creditors registered on the seized property on the date of publication of the summons to pay valid as a seizure, the creditors registered on the property before publication of the bill of sale and who intervened in the proceedings and the creditor mentioned in 1° bis of article 2374 of the Civil Code, they may also be sold by mutual agreement after the compulsory sale has been initiated and until the opening of the auction.
Article L. 311-3 of the Code of Civil Enforcement Procedures adds that "Any agreement to the effect that the creditor may sell the debtor's immovable property without following the procedure prescribed for the seizure of immovable property is null and void.
The seizure of property procedure authorises three types of forced sale: sale by mutual agreement, amicable sale and sale by auction.
First of all, sales by private treaty are little codified, little used and little commented on. It is mentioned in article L. 322-1 of the Code of Civil Enforcement Procedures: "The assets are sold either out of court by judicial authorisation or by auction.
In the event of an agreement between the debtor, the pursuing creditor, the creditors registered on the seized property on the date of publication of the summons to pay valid as a seizure, the creditors registered on the property before publication of the bill of sale and who intervened in the proceedings and the creditor mentioned in 3° of article 2402 of the Civil Code, they may also be sold by mutual agreement after the referral to forced sale and until the opening of the auction.
A sale by mutual agreement is where the pursuing creditor, the registered creditors and, where applicable, the co-owners' association authorise the debtor to sell the property out of court.
The text does not specify the form in which this sale must be carried out, but states that it can only take place between the referral of the case for compulsory sale and the opening of the auction. However, if the sale is carried out before the auction hearing, the pursuing creditor will not request the sale, and failure to do so will result in the lapse of the summons to pay for the seizure of the property: "On the date indicated, the pursuing creditor or, failing this, any registered creditor, then subrogated to the pursuit, shall request the sale.
If no creditor requests the sale, the judge declares that the summons to pay serving as a seizure has lapsed. In this case, the defaulting creditor retains all the costs of the seizure unless the court decides otherwise, giving its reasons. (article R. 322-27 of the French Code of Civil Enforcement Procedures).
Although the text does not provide any further details, in the case of a private sale that takes place before the auction hearing, the notary has two options:
This second solution is safer for the buyer, as it ensures that the sale is enforceable as soon as the deed of sale is signed, without having to wait for the judgment declaring that the summons to pay for the seizure of the property has lapsed.
It should be noted that the law only authorises private treaty sales between the referral to a compulsory sale and the auction hearing, because :
The text thus provides a solution for the amicable sale of the building at each stage of the procedure, initially under the supervision of the judge, then without the supervision of the judge, but with the agreement of the parties and the co-owners' association.
In practice, however, there is nothing to prevent the debtor from seeking and obtaining authorisation from its creditors to sell by mutual agreement at any stage of the proceedings, although this solution requires different techniques to be used to abandon the proceedings properly:
Example: the case is referred for an amicable sale with judicial authorisation, but the debtor does not manage to sell under the terms and conditions of the referral judgment. The debtor nevertheless manages to submit a compromise sale to the pursuing creditor and the registered creditors at a price higher than the expected auction price. The pursuing creditor and the registered creditors will be able to accept a sale by mutual agreement, which the enforcement judge will not be able to approve as he will be bound by the res judicata authority attached to the referral judgment he has previously handed down. The pursuing creditor will therefore have to authorise the release of the summons with the agreement of the registered creditors, before presenting a withdrawal submission at the reminder hearing.
Lastly, the pursuing creditor's lawyer may request payment of taxed costs, fixed emoluments and the proportional emolument under the same conditions as for an out-of-court sale.
Article R. 322-22, paragraph 1, of the Code of Civil Enforcement Procedures states that "The debtor shall take the necessary steps to conclude the amicable sale. He shall report to the pursuing creditor, at his request, on the steps taken to this end.
The debtor's duty of care is reiterated in Article 14, paragraph 1, of the General Provisions of the Conditions of Sale: "The debtor must take the necessary steps to conclude the amicable sale.
When the court authorises an out-of-court sale, the debtor is responsible for carrying out all the necessary formalities. The debtor will therefore have to find a buyer to complete the sale within the time limit set by the court.
Article L. 322-4 of the French Code of Civil Enforcement Procedures states that "The notarial deed of sale is only drawn up once the price has been deposited with the Caisse des Dépôts et Consignations and proof has been provided that the costs of the sale and taxed costs have been paid.
Article R. 322-24, paragraph 2, of the Code of Civil Enforcement Procedures adds that "Taxed costs are paid directly by the buyer in addition to the sale price.
The notary will only draw up the deed of sale once the taxed costs have been paid by the purchaser.
The pursuing creditor's lawyer will therefore have to submit his statement of costs to the execution judge for taxation. The tax order will make it possible to confirm the amount and request payment, which in turn will enable the notary to draw up the deed of sale.
Circular CIV/17/06 of 14 November 2006 on the reform of the seizure of property states on page 31 that "If the pursuing creditor so requests, with a figure, at the orientation hearing, the judge's decision will tax the pursuing creditor's costs, enabling the pursuing creditor to be reimbursed directly when the sale is subsequently concluded.
However, case law generally accepts that costs can be taxed after the orientation hearing (Caen, 27 September 2012, no. 12/02041). Lawyers should contact the auction registry to find out about the customs and practices of the court before which the proceedings are being brought.
The statement of costs must include taxed costs, but not necessarily emoluments, even if it is prudent to include them. The latter are legal and imposed on the parties, although the text does not expressly make them the responsibility of the buyer. In any event, the fees include the formalities and the proportional fee.
Taxed costs include all the costs incurred by the pursuing creditor in the course of the proceedings, i.e. the costs of the bailiff and the property diagnostician involved in drawing up the procès-verbal to carry out the Carrez measurement and, where applicable, the technical diagnostics file.
Formality fees are listed in article A. 444-193 of the French Commercial Code.
The proportional fee is calculated in accordance with Articles A. 444-191 and A. 444-102 of the French Commercial Code, using the following scale:
|
SLICES OF PLATE |
APPLICABLE RATE |
|
From €0 to €6,500 |
3,870 % |
|
From €6,500 to €17,000 |
1,596 % |
|
From €17,000 to €60,000 |
1,064 % |
|
More than €60,000 |
0,799 % |
This scale is based on the decree of 28 February 2020 setting the regulated rates for notaries.
The last paragraph of Article A. 444-102 of the French Commercial Code states that "The emolument is calculated separately on the auction price of each lot, even if several separate lots are sold separately to the same successful bidder. However, the fee is calculated on the price of the combined lots if the auction takes place after all or part of the lots offered for sale have been combined.
The statement of costs will end with a request for a fee, which will enable the enforcement judge to affix the fee form.
Article L. 322-4 of the French Code of Civil Enforcement Procedures states that "The notarial deed of sale is only drawn up once the price has been deposited with the Caisse des Dépôts et Consignations and proof has been provided that the costs of the sale and taxed costs have been paid.
Article R. 322-23 of the Code of Civil Enforcement Procedures adds that "The sale price of the property and any sums paid by the purchaser for whatever reason are deposited with the Caisse des Dépôts et Consignations and acquired by the creditors participating in the distribution and, where applicable, the debtor, for distribution to them.
In the event that the sale is not completed by the purchaser, and subject to the legislative or regulatory provisions relating to the purchaser's right of withdrawal, any payments made by the purchaser shall remain on deposit to be added to the sale price in the distribution.
Lastly, article R. 322-24, paragraph 1, of the Code of Civil Enforcement Procedures states that "Taxed costs are paid directly by the buyer in addition to the sale price.
The deed of sale will only be drawn up once the sale price has been deposited with the Caisse des Dépôts et Consignations and proof of payment of the costs of the sale and taxed costs has been provided.
The text does not specify with which fund the costs of sale and taxed costs must be deposited. In practice, they will be deposited with the CARPA, and proof of payment will enable the notary to draw up the bill of sale.
These obligations are set out in Article 14 of the General Provisions of the Sales Terms and Conditions, which, for the record, have normative value: "The debtor must take the necessary steps to conclude the amicable sale.
The fulfilment of the conditions of the amicable sale previously decided by the judge will be checked by him.
The sale price of the property, interest thereon and any sums paid by the purchaser in excess of the sale price for any reason whatsoever are paid to the Caisse des dépôts et consignations in accordance with article R. 322-23 of the Code des procédures civiles d'exécution. They are forfeited to the debtor and the creditors participating in the distribution.
However, in accordance with article 1593 of the French Civil Code, the taxed costs, plus the emoluments calculated in accordance with the tariff in force, are paid directly by the purchaser, in addition to the sale price, to the pursuing lawyer, with a charge for restitution in the event of a judgment refusing to declare that the conditions of the sale have been fulfilled and ordering a compulsory sale, or for collection in the event of a judgment declaring an amicable sale.
The judge ensures that the deed of sale complies with the conditions he has set, that the price has been deposited, and that the taxed costs and fees of the pursuing lawyer have been paid, and does not record the sale until these conditions have been met. Failing this, he orders the forced sale.
It would be prudent for the creditor's lawyer to obtain the judgment recording the completion of the amicable sale in order to request the disbursement of the sums deposited with the CARPA.
In addition, where the failure to conclude the sale is attributable to the purchaser, the sums paid under a preliminary contract and deposited with the Caisse des dépôts et consignations by the notary remain deposited there to be added to the sale price in the distribution, subject to the right of withdrawal provided for in article L. 271-2 of the Code de la construction et de l'habitation, which is a matter of public policy.
Article R. 322-24, paragraph 1, of the Code of Civil Enforcement Procedures states that "The notary responsible for drawing up the deed of sale may obtain, in return for a receipt, delivery from the pursuing creditor of the documents collected for the purpose of drawing up the conditions of sale.
The out-of-court sale is carried out under the supervision of the judge and must therefore comply with the conditions set out in the referral ruling.
The notary may ask for the documents collected by the pursuing creditor's lawyer in order to prepare the deed of sale. The pursuing creditor's lawyer must order and consult a large number of documents in order to draw up the conditions of sale, which will also be useful to the notary in drawing up the deed of sale.
In particular, the debtor will be able to limit the costs required to complete the sale by re-using the technical diagnostic file if the pursuing creditor has had it drawn up when the descriptive report is drawn up.
Article L. 322-3 of the French Code of Civil Enforcement Procedures states that "An amicable sale with judicial authorisation has the same effect as a voluntary sale. It may not give rise to rescission on the grounds of lesion.
An amicable sale with judicial authorisation has all the effects of a conventional notarial sale under ordinary law, with the exception of rescission on the grounds of lesion.
Article L. 322-14 of the French Code of Civil Enforcement Procedures provides that "The payment of the price or its deposit and the payment of the costs of the sale automatically release the property from all mortgages and liens on the debtor from the date of publication of the title of sale.
An amicable sale automatically releases the property from all mortgages and liens on the debtor from the date of publication of the deed of sale.
However, the purging of registrations does not automatically entail their cancellation, which will be ordered at a later date by the judgment recording the completion of the amicable sale.
Only the execution judge can review the completion of the out-of-court sale, even when the out-of-court sale has been ordered by the court of appeal (Civ. 2e23 October 2008, no. 08-13.404). The second paragraph of Article 14 of the General Provisions of the Terms and Conditions of Sale refers to the enforcement judge's jurisdiction: "The fulfilment of the conditions of the amicable sale decided beforehand by the judge will be checked by him.
The judge's control is exercised before and after the sale is concluded.
Article R. 322-22 of the Code of Civil Enforcement Procedures states that "The debtor shall take the necessary steps to conclude the amicable sale. He shall report to the pursuing creditor, at his request, on the steps taken to this end.
The pursuing creditor may, at any time, summon the debtor before the court to declare that he has failed to act and order the resumption of the compulsory sale procedure.
If the proceedings are resumed after the orientation hearing, the judge sets the date for the auction hearing, which is held within a period of between two and four months. The seized debtor, the pursuing creditor and the registered creditors are notified of the decision.
The decision ordering the resumption of proceedings is not subject to appeal.
The pursuing creditor may ask the debtor to report on the steps taken to reach an amicable sale. If the debtor fails to do so, the pursuing creditor may summon him before the enforcement judge to order the forced sale.
The judge then sets a date for the auction hearing within two to four months of the judgment.
The text does not specify whether the debtor must appoint a lawyer at this stage of the proceedings. Article R. 322-17 of the Code of Civil Procedures, which exempts the debtor from the requirement to be represented by a lawyer in order to submit an application for an out-of-court sale, concerns the application for an out-of-court sale submitted at the orientation hearing and the acts subsequent to this sale: "The debtor's request for authorisation of the amicable sale of the property, as well as the acts subsequent to this sale, do not require the assistance of a lawyer. This request may be made orally at the orientation hearing.
Should a debtor summoned for the purpose of establishing that there has been a failure to act and resuming the compulsory sale procedure be considered to be entitled to attend the hearing alone and without a lawyer, on the grounds of "consecutive acts to the request for amicable sale? There is no answer to this question in the text or in case law.
The effects of the resumption of proceedings must be distinguished according to the time at which the judgment authorising the out-of-court sale was handed down.
Article R. 322-20, paragraph 2, of the Code of Civil Enforcement Procedures provides that "The decision granting the application suspends the course of the enforcement proceedings, with the exception of the period allowed for registered creditors to declare their claims.
A decision to authorise an out-of-court sale before the orientation hearing suspends the course of the enforcement proceedings, which will therefore be resumed at the stage at which it was suspended in order to summon the debtor to the orientation hearing.
At this hearing, however, the debtor will not be able to reapply for authorisation to sell his property out of court, as the decision authorising the out-of-court sale, and then the decision ending the suspension of proceedings, will be res judicata.
Article R. 322-22 of the French Code of Civil Enforcement Procedures, cited above, states that in extenso above, states that "The debtor shall take the necessary steps to conclude the amicable sale. He shall report to the pursuing creditor, at his request, on the steps taken to this end.
The pursuing creditor may, at any time, summon the debtor before the court to declare that he has failed to act and order the resumption of the compulsory sale procedure.
If the proceedings are resumed after the orientation hearing, the judge sets the date for the auction hearing, which is held within a period of between two and four months. The seized debtor, the pursuing creditor and the registered creditors are notified of the decision.
The decision ordering the resumption of proceedings is not subject to appeal.
The text does not specify whether the decision ordering the resumption of proceedings is an order or a judgment, but case law confirms that it is a judgment (Civ. 2e6 December 2012, no. 11-26.683).
However, the text stipulates that the adjudication hearing will be held within a period of between +2 and +4 months from this decision, which will be notified to all the parties and which will not be subject to appeal. Jurisprudence adds that it will also not be open to appeal (Civ. 2e2 December 2012, no. 11-26.683, again), on the grounds that this judgment "did not decide part of the main issue or terminate the proceedings"..
For all intents and purposes, it should be remembered that the referral ruling clears all disputes and incidental claims, unless they relate to acts performed after the referral hearing. When the referral judgment orders an out-of-court sale, none of the subsequent time limits are provided for, on pain of the order lapsing, so that the only object of the discussions will be the steps taken by the debtor to determine whether they are sufficient.
The Code of Civil Enforcement Procedures does not provide for the publication of judgments terminating the stay of proceedings, nor for the publication of judgments ordering the resumption of the forced sale. However, article 80 8° of decree no. 55-1350 of 14 October 1991 states that "The following shall be published in the form of a note in the margin of the copy of the order for seizure :
[...]
8° Generally speaking, the various procedural acts relating to the order, such as subrogation in the proceedings, the judgment declaring the segregation of all or part of the seized property, etc.".
The original and a copy of the deed to be published must be sent to the relevant land registry, together with a certificate of identity of the parties and, if necessary, a request for a statement of formality (CERFA no. 3233-SD), together with a cheque made payable to Treasury in the amount of :
Article R. 322-21, paragraphs 3 and 4, of the Code of Civil Enforcement Procedures states that "The judge] shall set the date of the hearing at which the case will be recalled within a period that may not exceed four months.
At this hearing, the judge may only grant additional time if the applicant can provide proof of a written commitment to purchase and to allow the deed of sale to be drawn up and concluded. This period may not exceed three months.
Article R. 322-25 of the same code states that "At the hearing at which the case is recalled, the judge ensures that the deed of sale complies with the conditions he has set, and that the price has been deposited. He will not record the sale until these conditions have been met. He then orders the cancellation of the mortgage and preferential rights registered against the debtor.
The judge ensures that the deed of sale complies with the conditions set out in the judgment authorising the out-of-court sale, and checks that the sale price has been deposited.
If these conditions are met, the judge will order the cancellation of the mortgage and lien registrations taken out against the debtor.
If at the reminder hearing, which takes place within 4 months of the judgment authorising the out-of-court sale, the debtor provides evidence of a written commitment to purchase, the judge may grant him a further 3 months to enable him to finalise the sale.
The concept of a written commitment to purchase means that the judge will not be able to be satisfied with a promise to sell, and will probably require a preliminary sale agreement, which demonstrates not only a willingness to sell, but also a willingness to buy.
In the alternative, an offer at the price may be qualified as a written commitment to purchase under the provisions of article 1583 of the Civil Code, which relates to sale and states that "It is perfected between the parties, and ownership is acquired by right by the buyer with respect to the seller, as soon as the thing and the price have been agreed, even though the thing has not yet been delivered or the price paid.
For example, the Marseille Regional Court ruled that "Acceptance is the expression of will by which the offeree agrees to purchase on the terms proposed by the offeror. Acceptance must be pure and simple for the contract to be formed. It can therefore be formulated very summarily.
[...]
There is therefore an agreement on the item and on the price which demonstrates the perfect nature of the sale...". (TGI Marseille, 10th Civil Division, 21 May 2012, no. 11/05619).
The request for an extension may be made by the debtor himself, in accordance with article R. 322-17 of the Code of Civil Enforcement Procedures: "The debtor's request for authorisation of the amicable sale of the property, as well as the acts subsequent to this sale, do not require the assistance of a lawyer. This request may be made orally at the orientation hearing.
If at the reminder hearing, or at the second reminder hearing, the conditions enabling the judge to establish that the sale has been completed have not been met, the judge shall order the forced sale.
Article R. 322-25 of the French Code of Civil Enforcement Procedures states that "At the hearing at which the case is recalled, the judge ensures that the deed of sale complies with the conditions he has set and that the price has been deposited. He does not record the sale until these conditions have been met. He then orders the cancellation of the mortgage and preferential rights registered against the debtor.
There is no right of appeal.
The land registry department that publishes the judgment will make a note of this in the margin of the publication of the copy of the summons and will cancel the corresponding entries.
If it is not possible to establish an out-of-court sale, the judge shall order a compulsory sale under the conditions set out in the third and fourth paragraphs of article R. 322-22.
The judgment records the completion of the amicable sale and orders the cancellation of the mortgage and lien registrations taken out against the debtor.
This judgement is not subject to appeal.
As soon as the sale has been completed, this judgment also enables the notary to publish the title deed, which would previously have been subject to annulment if the judge considered that the sale did not comply with the conditions set out in the judgment authorising the out-of-court sale.
Article R. 311-7 of the French Code of Civil Enforcement Procedures does not provide for the registry to notify the judgment recording the completion of the out-of-court sale, which will be served at the request of the party with an interest in the sale.
Mortgage registrations and liens will be cancelled by the Land Registry upon publication of the judgment recording the completion of the out-of-court sale, in accordance with article R. 322-25 of the French Code of Civil Enforcement Procedures: "At the hearing at which the case is recalled, the judge ensures that the deed of sale complies with the conditions he has set and that the price has been deposited. He does not record the sale until these conditions have been met. He then orders the cancellation of the mortgage and preferential rights registered against the debtor.
There is no right of appeal.
The land registry department that publishes the judgment will make a note of this in the margin of the publication of the copy of the summons and will cancel the corresponding entries.
If it is not possible to establish an out-of-court sale, the judge shall order a compulsory sale under the conditions set out in the third and fourth paragraphs of article R. 322-22.
Article 80 6° of Decree no. 55-1350 of 10 October 1955 also provides for the publication of the judgement recording the out-of-court sale on the margin of the summons to pay for the seizure of the property: "The following shall be published in the form of a note in the margin of the copy of the order for seizure :
[...]
6° Publication of the judgment or order ordering the cancellation of the registrations;".
Sales by auction are governed by articles L. 322-5 to L. 322-13 and R. 322-26 to R. 322-72 of the French Code of Civil Enforcement Procedures.
Article R. 322-30 of the Code of Civil Enforcement Procedures states that "The forced sale shall be conducted after advertising to ensure that as many bidders as possible are informed in accordance with the conditions set out in this section.
Article R. 322-31, paragraph 1, of the Code of Civil Enforcement Procedures states that "The compulsory sale is announced at the initiative of the pursuing creditor between one and two months before the auction hearing.
Posting must be done between -2 and -1 months before the date of the auction hearing, which is set by the judgment ordering the compulsory sale.
As a reminder, the date of the auction hearing is between +2 and +4 months from the judgment ordering the compulsory sale.
In practice, you should contact the legal gazette as soon as possible to find out when the advertisements should be sent so that they can be included in the next edition.
Example: The Saturday edition is printed on Friday. The legal gazette is published weekly. Advertisements must therefore be sent in by 12 noon on the Thursday in order to be included in the following Saturday's edition. The lawyer will have to take these material constraints into account to ensure that the notices are published within the legal deadline.
Article R. 322-31 of the French Code of Civil Enforcement Procedures states that "The forced sale is announced at the initiative of the pursuing creditor between one and two months before the auction hearing.
To this end, the pursuing creditor drafts a notice, deposits it at the registry of the execution judge so that it can be posted without delay on the court premises, in a place that is easily accessible to the public, and arranges for its publication in one of the legal gazettes circulated in the district where the seized property is located.
The notice states:
1° The full name and address of the pursuing creditor and his lawyer ;
2° The designation of the property seized and a brief description indicating its nature, any occupancy and any known details of its surface area, as well as, where applicable, the dates and times of the visit;
3° The amount of the reserve price ;
4° The day, time and place of the sale;
5° An indication that bids may only be placed by a lawyer registered at the bar of the judicial court of the place of the sale;
6° An indication that the schedule of conditions of sale may be consulted at the registry of the enforcement judge or at the office of the pursuing party's lawyer.
The notice published in the legal gazette contains no other information.
The posted notice shall be written in type no smaller than 30 point on A3 format (40 × 29.7 cm).
The text requires that a notice be published in a legal gazette circulated in the district in which the seized property is located, and that this notice be filed with the registry for posting.
The poster must include all the information listed in the aforementioned article R. 322-21, in the required format (font size 30, A3 format), although the text does not stipulate any penalties.
In practice, as the notice must state the date and time of the visit, the lawyer must first ask the bailiff who is organising the visit about his availability.
In all cases, the lawyer will ask the bailiff not to organise the visit on the dates and at the times of an auction hearing, to avoid the interested parties being held up at an auction hearing at the time of the visit.
Article R. 322-32 of the Code of Civil Enforcement Procedures states that "Within the period referred to in article R. 322-31 and at the request of the pursuing creditor, a simplified notice is affixed at the entrance or, failing this, at the boundary of the seized property and published in two periodical editions of local or regional newspapers, at the rate for ordinary advertisements.
This notice indicates, apart from the forced nature of the sale and the identity of the debtor :
1° The sale of the property by public auction ;
2° The nature of the property and its address ;
3° The amount of the reserve price ;
4° The day, time and place of the sale;
5° An indication that the schedule of conditions of sale may be consulted at the registry of the enforcement judge or at the office of the pursuing party's lawyer.
The format and font size of the notice affixed to the building are identical to those mentioned in article R. 322-31.
Article R. 322-33 of the same code adds that "A copy of the notice published in the newspaper and a copy of the notice affixed to the property shall be certified by a bailiff.
The simplified notice will be published in two local or regional newspapers, at the rate for ordinary advertisements. As a result, the judge may refuse in whole or in part to tax an excessive rate.
The simplified notice will also be affixed to the seized property. Proof of affixing will be provided by a bailiff's report, a copy of which will be filed with the auction registry.
Article R. 322-33 of the Code of Civil Enforcement Procedures provides, as mentioned above, that "A copy of the notice published in the newspaper and a copy of the notice affixed to the property shall be certified by a bailiff.
The lawyer must file a copy of the posters, i.e. the notice and the simplified notice, as well as a copy of the notice of posting, with the clerk's office.
In practice, the legal gazette generally prepares the posters and sends them to the bailiff to draw up the notice of posting. The lawyer will then simply prepare a draft poster and send it to the legal gazette, along with the name of the bailiff who will draw up the notice.
Article R. 311-11, paragraph 1, of the Code of Civil Enforcement Procedures states that "The nullity of acts of the real estate seizure procedure is governed by Section IV of Chapter II of Title V of Book I of the Code of Civil Procedure.
Article R. 311-11, paragraph 1, of the same code adds that "The time limits stipulated in articles R. 321-1, R. 321-6, R. 322-6, R. 322-10 and R. 322-31, as well as the two- and three-month time limits stipulated in article R. 322-4, are prescribed, failing which the summons to pay will lapse.
Finally, article R. 311-5 states that "Unless otherwise stipulated, no challenge or incidental claim may be lodged after the orientation hearing provided for in article R. 322-15, unless it relates to procedural documents issued after that hearing, in which case the challenge or incidental claim must be lodged within fifteen days of notification of the document. In this case, the challenge or incidental claim must be lodged within fifteen days of notification of the document.
The text provides for two types of penalty.
Firstly, the posting deadlines are stipulated on pain of invalidity of the summons to pay for the seizure of the property.
Secondly, the compulsory details of the notices are provided on pain of nullity, according to the system of exceptions to nullity, so that they require the demonstration of a grievance.
In all cases, disputes relating to the advertising of the sale must be submitted by way of pleadings within 15 days of their completion (Civ. 2e26 June 2014, no. 13-20.193).
Article R. 322-36 of the Code of Civil Enforcement Procedures states that "The pursuing creditor or the registered creditors may, without having to obtain the authorisation of the court, use any additional means of information to announce the sale. These means must not entail costs for the debtor or reveal the forced nature of the sale or the name of the debtor".
The pursuing creditor may carry out additional advertising at his own expense, provided that he does not disclose the forced nature of the sale and the name of the debtor.
In theory, this text provides a framework for the publication of advertisements on the Internet. In practice, however, the advertisements placed online on law firm websites also make available to the public the essential marketing documents, i.e. the descriptive report, the poster and the conditions of sale, which make it possible to identify the forced nature of the sale.
Article R. 322-37 of the Code of Civil Enforcement Procedures states that "An application may be made to the enforcement judge by the pursuing creditor, one of the registered creditors or the distrainee to adjust, restrict or complete the publicity measures provided for in articles R. 322-31 to R. 322-35.
The request is made, depending on the case, at the orientation hearing, no later than two months before the auction hearing or within two working days of the sale.
The judge will take into account the nature, value and location of the property and any other special circumstances.
In particular, it may order :
1° Any other information or document relating to the property must be added to the information provided for in articles R. 322-31 and R. 322-32;
2° That the publicity measures are carried out by other means of communication that it indicates;
3° That the notices referred to in articles R. 322-32 and R. 322-34 are posted at a place designated by the Minister in the municipalities where the property is located.
When the judge rules by order, his decision is not subject to appeal.
Article R. 322-38 then states that "The publicity measures ordered by the judge pursuant to article R. 322-37 are carried out at the request and advanced expense of the party requesting them.
The pursuing creditor may apply to the enforcement judge for authorisation to arrange, restrict or complete the advertising measures, no later than two months before the auction hearing, or no more than two working days after the sale.
This request can also be made at the orientation hearing.
In particular, this solution will enable the pursuing creditor to implement new publicity measures when the exceptional nature of the sale warrants wider distribution than that initially provided for in the text.
Article 10 II of Law no. 75-1351 of 31 December 1975 on the protection of occupants of residential premises states that "I-Prior to the conclusion of any sale of one or more premises for residential use or for mixed residential and business use, following the initial division or subdivision of all or part of a building into lots, the lessor must, failing which the sale will be null and void, notify each of the tenants or occupants in good faith, by registered letter with acknowledgement of receipt, of the price and conditions of the proposed sale for the premises they occupy. This notification shall be deemed to constitute an offer of sale to the addressee.
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II - When the sale of the premises for residential use or for mixed residential and business use takes place by voluntary or forced auction, the tenant or occupant in good faith must be invited to attend by registered letter with acknowledgement of receipt at least one month before the date of the auction.
If no notice is given, the tenant or occupier in good faith may, within a period of one month from the date on which he became aware of the auction, declare that he will take the place of the successful bidder. However, in the case of a sale by auction, the tenant or occupier may not exercise this right if the sale was made to an undivided co-owner.
Article 7 of Decree no. 77-742 of 30 June 1977 stipulates that "I - When the sale of the flat and its ancillary premises takes place by voluntary or compulsory auction, the tenant or occupant acting in good faith must be invited to attend, at the request of either the vendor or the debtor, or their agent, by registered letter with acknowledgement of receipt, at least one month before the date of the auction.
It indicates whether or not there is a reserve price and, if so, the amount. It also indicates the date, place and time of the auction hearing and the court or notary before which it will be held; it also states that the bids are to be placed before the court by a lawyer and reproduces the terms of paragraph II of article 10 of the aforementioned law of 31 December 1975.
When, either because of a procedural incident or for any other legal reason, or in application of articles 703 and 737 of the Code of Civil Procedure, the auction has been delayed, a new summons will be issued within the time limits set out in article 736 of the same code and in the manner set out in the previous paragraph.
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IV - In the absence of an invitation to attend and within a period of one month from receipt of the notification provided for in paragraph II, the tenant or occupant acting in good faith may declare that he/she is taking the place of the successful bidder, at the price and under the conditions of the auction. This declaration, made by registered letter with acknowledgement of receipt, is sent to the court clerk or to the notary who pronounced the auction.
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When the sale by auction follows the initial division or subdivision of all or part of a property into lots, the pursuing creditor must summon the tenant or occupant in good faith by registered letter at least 1 month before the date of the auction. This letter must state the amount of the upset price, the dates and times of the auction hearing, the address of the court, that the bids will be made by a lawyer and reproduce the terms of paragraph II of the aforementioned article 10.
In other words, the tenant must be notified of the sale only if it takes place after the co-ownership has been created, i.e. after publication of the descriptive statement of division in the property register, or if it takes place after a subdivision of all or part of a co-ownership.
Case law is very clear on this point: "But whereas, having correctly held, on its own grounds, that the tenant or occupier in good faith may only exercise the right of substitution provided for in Article 10-II of the Law of 31 December 1975 on condition that the auction follows the initial division of the building and having noted, on adopted grounds, that the building had been the subject, under the deed of 24 May 1948, of co-ownership regulations containing the descriptive statement of division and that the mortgage statement revealed eight sales or divisions that had taken place, that the building had been the subject, under a deed dated 24 May 1948, of co-ownership regulations containing a description of the division and that the mortgage statement showed eight sales or divisions that had taken place since then, the Court of Appeal rightly deduced that the auction was not subsequent to the initial division of the building and that Mr. and Mrs Z... did not have the right to substitute themselves for the purchasers;". (Cass. 3e civ., 26 Nov. 2013, no. 12-25.412, Bull. 2013, III, no. 151).
If no notification is received within the aforementioned one-month period, the tenant or occupant in good faith may declare that he/she is taking the place of the successful bidder at the auction price and conditions by registered letter with acknowledgement of receipt sent to the Registry of Auctions.
These provisions only apply to residential premises or premises used for both residential and business purposes.
Finally, the concept of an occupier or tenant in good faith is defined in article 4 of law no. 48-1360 of 1 September 1948: "The occupants in good faith of the premises defined in article 1 are automatically entitled, without the need to comply with any formalities, to remain in the rented premises under the terms and conditions of the original contract that are not contrary to the provisions of the present law, regardless of the date on which they moved in.
Tenants, sub-tenants and assignees of leases are deemed to be acting in good faith when their contract expires, as are occupants who, by virtue of or pursuant to a written or verbal lease, a regular sub-lease, a regular assignment of a previous lease, or an exchange carried out in accordance with the law, are fulfilling their obligations.
The deed by which the lessor notifies the lessee that he is terminating the lease and which gives rise to the application of the preceding provisions must, on pain of nullity, reproduce the provisions of the two preceding paragraphs and specify that it does not in itself entail an obligation to actually vacate the premises.
The fact that the tenant or occupier of premises used for professional purposes carries on an activity, either in collaboration with other persons exercising a liberal profession under the conditions provided for by the rules governing their professions, or within a company incorporated in accordance with law no. 66-879 of 29 November 1966, cannot in itself be considered to be a breach of the clauses of the lease.
In the event of partial rental or partial subletting, the right to maintain occupancy is not enforceable against the owner, tenant or main occupant when the premises occupied form, with the premises as a whole, an indivisible whole, or when they are rooms constituting an accessory to the premises inhabited by the owner, tenant or main occupant".
Article L. 412-11 of the French Rural Code states that "In the case of a sale by voluntary or compulsory auction, the lessee benefiting from the right of pre-emption must, on pain of the sale being declared null and void, be summoned to attend by registered letter with acknowledgement of receipt or by bailiff's deed, at least twenty days before the date of the auction, either by the notary responsible for the sale or, in the case of a sale brought before the court, by the chief clerk of the said court.
The pursuing creditor's lawyer must inform the auction registry of the presence of a rural leaseholder. The clerk's office must inform the lessee of the auction hearing or the higher bid hearing within 20 days of the sale, by registered letter with acknowledgement of receipt, failing which the sale will be null and void.
The SAFERs' right of pre-emption derives from article L. 143-7 of the French Rural Code and concerns real estate used for agricultural purposes, and is exercised in accordance with article L. 143-8 under the conditions of article L. 412-11 of the aforementioned Rural Code.
Once again, notification must be made by the auction clerk's office within 20 days of the auction hearing or the higher bid hearing, by registered letter with acknowledgement of receipt, failing which it will be null and void.
Articles L. 210-1 et seq. and R. 213-5 et seq. of the French Town Planning Code establish the right of communes, certain public establishments for communal cooperation, the département and the General Council to :
The auction registry must send a declaration of intention to sell to the town hall at least 30 days before the date of the auction hearing by registered letter with acknowledgement of receipt.
Article R. 322-26, paragraph 2, of the Code of Civil Enforcement Procedures states that "The judge shall determine the procedures for visiting the property at the request of the pursuing creditor.
The terms and conditions of the visit will be set out in the referral decision.
The date and time of the visit are generally not mentioned in the referral judgment, as they will be determined by the bailiff, who will organise it.
In practice, the enforcement judge generally authorises the inspection of the property freely, and if necessary with the assistance of a bailiff and, if necessary, the police and a locksmith. If the preliminary ruling does not so provide, this assistance will be requested by way of a petition, in exactly the same way as for drawing up the descriptive report.
In practice, if the technical diagnostic file was not drawn up at the same time as the descriptive report, or if some of the diagnostics are out of date, the lawyer will ask the bailiff to contact the expert diagnostician to draw up or update the file. The file or its update will then be appended to the terms and conditions of sale by way of an addendum or Dire, depending on the local jargon.
Article R. 322-42 of the Code of Civil Enforcement Procedures states that "The costs of the proceedings, duly justified by the pursuing creditor and, where applicable, by the higher bidder, are assessed by the judge and publicly announced before the opening of the auction. Nothing may be demanded in excess of the amount of the fee. Any stipulation to the contrary shall be deemed unwritten.
The statement of costs subject to taxation is drawn up after completion of the publicity formalities and the inspection of the seized property, because the cost of the inspection is included in the statement.
Debt collection costs include all the costs incurred by the creditor in recovering the debt. The practices of enforcement judges are not uniform in this area and while some have a broad conception of the notion of "costs of proceedings (costs of mortgage registration, formal notice, etc.), others interpret it much more restrictively.
In general, these costs will include all bailiff's fees, the costs of drawing up the technical diagnostic file and all expenses incurred in publishing the deeds and ordering documents (land registration costs).
The fees include the formalities fee and the proportional fee.
Formality fees are listed in article A. 444-193 of the French Commercial Code.
The proportional fee, on the other hand, cannot be included in the statement of costs as it is calculated on the basis of the auction price. The amount of this fee will not be known until after the sale, although it will not go entirely to the pursuing creditor's lawyer, but will be shared with the successful bidder's lawyer.
The statement of costs will end with a request for a fee, which will enable the enforcement judge to check the steps taken and, if necessary, set aside any costs he deems unnecessary in accordance with articles L. 111-7 and L. 111-8 of the Code of Civil Enforcement Procedures, before affixing the fee form.
In practice, the lawyer will attach proof of all the expenses incurred by his client to his tax claim.
The pursuing creditor may not demand anything in excess of the fee. This provision is a matter of public policy.
Article R. 322-28 of the Code of Civil Enforcement Procedures states that "The compulsory sale may only be postponed in the event of force majeure or at the request of the Commission de surendettement (excessive debt commission), in accordance with articles L. 722-4 or L. 721-7 of the Code de la consommation.
The auction hearing may only be postponed in the event of force majeure.
The request for postponement must be made in writing, failing which the order will lapse. Indeed, case law analyses this request as an incidental request, which as such must be presented in writing, so that the absence of a written request for postponement of the auction hearing results in the lapse of the summons to pay for the seizure of the property for failure to request the sale (Civ. 2e22 February 2012, no. 11-11.914).
If the enforcement judge refuses to order a postponement of the sale, the pursuing creditor's lawyer will be obliged to request the sale, failing which the summons to pay will lapse. This is why it is advisable to proceed with the formalities for advertising when the auction hearing has not been postponed.
Example: the debtor applies for a postponement of the auction hearing, which the pursuing creditor opposes. As a precaution, the pursuing creditor carries out the publicity formalities so that, if the judge refuses to order the postponement of the auction hearing, he can request the sale. Failure to advertise or request the sale will result in the sale order lapsing.
Article R. 322-28 of the Code of Civil Enforcement Procedures states that "The compulsory sale may only be postponed in the event of force majeure or at the request of the Commission de surendettement (excessive debt commission), in accordance with articles L. 722-4 or L. 721-7 of the Code de la consommation.
Article L. 722-4 of the French Consumer Code states that "In the case of a property seizure, when a compulsory sale has been ordered, the auction date may only be postponed by a decision of the judge responsible for the property seizure, referred to this end by the commission, for serious and duly justified reasons.
Article L. 721-7 of the Consumer Code is identical: "In the case of a property seizure, when a compulsory sale has been ordered, the auction date may only be postponed by a decision of the judge responsible for the property seizure, referred to this end by the commission, for serious and duly justified reasons.
Articles L. 722-4 and L. 721-7 are strictly identical, but the former is inserted under the title Effects of the admissibility decision while the second is inserted under the title Referral to the commission de surendettement des particuliers (private individuals' over-indebtedness commission).
This means a contrario that the decision of admissibility by the over-indebtedness commission, which normally leads to an automatic suspension of enforcement proceedings, does not apply to property seizure proceedings, which are subject to specific rules.
The case law adds that the adjudication judgment rejecting the request for postponement submitted by the over-indebtedness commission is not subject to appeal, which the court must note of its own motion in accordance with article 125 of the Code of Civil Procedure, according to which the absence of legal remedies constitutes a public policy ground of non-receivability (Civ. 2e29 September 2011, no. 10-27.658).
Article R. 322-19 of the Code of Civil Enforcement Procedures states that "An appeal against a referral order is lodged, heard and decided in accordance with the fixed date procedure, without the appellant having to rely on a peril in his application.
Where the appeal is lodged against a judgment ordering the sale by auction, the court shall rule no later than one month before the date set for the auction. Failing this, the enforcement judge may, at the request of the pursuing creditor, postpone the date of the forced sale hearing. Where a stay of proceedings resulting from the application of article R. 121-22 prevents the auction hearing from being held on the scheduled date and the judgement ordering the auction has been confirmed on appeal, the date of the auction is set on request by order of the enforcement judge. No appeal shall lie from a decision of the enforcement judge made pursuant to this paragraph.
When a party appeals against the preliminary ruling, the court must normally rule no later than 1 month before the date of the auction hearing. In practice, this is rarely the case, and the law provides that the pursuing creditor (and not the debtor) may request a postponement of the auction hearing in such cases.
If the debtor wishes to apply for a postponement of the auction hearing on the grounds of the current appeal, he will have to show that this appeal procedure has the characteristics of force majeure in the sense that the court's decision is unforeseeable.
If, at the same time as the appeal, the appellant applies for and obtains a stay of proceedings under article R. 121-22 of the Code of Civil Enforcement Procedures, and this decision prevents the enforcement judge from holding the auction hearing on the scheduled date, and the judgment ordering the sale by auction is confirmed on appeal, then the pursuing creditor will have to apply for a new auction date.
Case law shows that the decision of the enforcement judge granting the debtor a period of grace is binding on the real estate enforcement judge, who must postpone the auction hearing (Civ. 2e2 July 2009, no. 08-16.753). The ruling is based on article 480 of the Code of Civil Procedure, the first paragraph of which states that "A judgment which resolves in its operative part all or part of the principal claim, or which rules on a procedural objection, a plea in bar or any other incident, shall, as soon as it is delivered, be res judicata in relation to the dispute which it resolves.
It is therefore the authority of res judicata attached to the judgment that compels the real estate execution judge to accept the request for postponement of the auction hearing.
In any event, any suspension of enforcement measures ordered by judgment (collective proceedings, personal recovery, etc.) should force the judge to accept the request for postponement of the auction hearing. This is also why the over-indebtedness commission, whose admissibility decision does not have the force of res judicata, must submit a specially reasoned request for postponement of the auction hearing, which the enforcement judge may refuse.
Article R. 322-29 of the French Code of Civil Enforcement Procedures stipulates that publication formalities must be repeated if the sale is postponed: "If the compulsory sale is adjourned to a later hearing, it shall be advertised again in the same way and within the same timeframe as the first compulsory sale.
Some judges adjourn the case to a later hearing without setting a new auction date. This interposes an incidental hearing between the postponed sale hearing and the new auction hearing.
The text does not specify the deadline by which the case must be referred, but if the court sets a new auction date on the referral, it must allow the pursuing creditor sufficient time to carry out the advertising formalities once again, which must be repeated and subject to tax so that the buyer is liable.
Article L. 322-7 of the French Code of Civil Enforcement Procedures states that "Subject to any disqualifications arising from the functions they perform, any person may place a bid if they can provide guarantees of payment.
Subject to limited restrictions, any person may bid, so much so that the Criminal Code provides for and punishes the offence of hindering the freedom of bidding in article 313-6 : "The act, in a public auction, of excluding a bidder or limiting bids or offers, by means of gifts, promises, agreements or any other fraudulent means, is punishable by six months' imprisonment and a fine of 22,500 euros. Accepting such gifts or promises is punishable by the same penalties.
The same penalties shall apply:
1° The act, at a public auction, of obstructing or disturbing the freedom of bidding or bids, by violence, assault or threats;
2° Carrying out or participating in an auction after a public auction without the assistance of the competent ministerial officer or sworn goods broker or a declared operator of voluntary sales of furniture by public auction.
Any attempt to commit an offence under this article shall be punishable by the same penalties.
The bidder must be capable, within the meaning of common law, on the day of the auction hearing.
Companies in the process of forming can push the bidding.
Under the old texts, the Court of Cassation recalled that "an auction in the name and on behalf of a company that is in the process of being formed is not null and void where, by virtue of the acts performed during its formation, the auction is deemed to have been concluded from the outset by the company registered subsequently". (Civ. 2e10 September 2009, no. 08-15.882).
The absence of registration will not prevent publication of the judgment, since Article 6 2. of Decree no. 55-22 of 4 January 1955 expressly states that " 2. The identification of legal entities shall be certified in accordance with the conditions laid down in paragraphs 2 and 3 of article 5.
If the legal entity is not registered in the register of companies and their establishments, or if it is in the process of being registered, the certificate of identity must be supplemented by a statement attesting to this situation.
However, Article 12.2, paragraph 1, of the RIN provides an important qualification: "The lawyer must ascertain from the client, and on the client's declaration, the client's legal capacity, legal situation and, in the case of a legal person, the reality of its existence, the extent of its corporate purpose and the powers of its representative.
In this way, the customer's capacity is checked on his declaration.
Article R. 322-39 of the Code of Civil Enforcement Procedures states that "The following are not eligible to bid, either on their own behalf or through an intermediary:
1° The distrainee debtor ;
2° Court officers who have intervened in any capacity in the proceedings;
3° The magistrates of the court before which the sale is being conducted.
Article 1596 of the Civil Code adds that "They may not, under penalty of being declared void, either by themselves or through intermediaries:
Guardians of the property of those under their guardianship;
Agents, of the goods they are responsible for selling;
The administrators of the municipalities or public establishments entrusted to their care;
Public officers, national assets sold through their ministry;
Fiduciaries, of the property or rights making up the fiduciary estate".
These incompatibilities do not prevent those concerned from bidding on properties that are not affected by their respective incompatibilities. For example, it is perfectly possible for a lawyer to bid on a property that has been sold following proceedings in which he was not involved. Similarly, a lawyer may bid in the name of and on behalf of one of his clients on a property that he himself is putting up for sale.
Article R. 322-41 of the Code of Civil Enforcement Procedures states that "Before placing the bids, the lawyer shall obtain from his principal, against receipt, an irrevocable bank guarantee or a bank cheque made payable to the escrow agent or to the Caisse des Dépôts et Consignations, as indicated in the conditions of sale, representing 10 % of the hammer price, but not less than €3,000.
The receipt shall reproduce the provisions of the third and fourth paragraphs of this article.
The sum collected by the escrow agent or the Caisse des Dépôts et Consignations is returned to the unsuccessful bidder at the end of the auction hearing.
Where the successful bidder defaults, the sum paid or the security provided is acquired by the creditors taking part in the distribution and, where applicable, by the debtor, to be distributed to them together with the price of the property.
The bidder's lawyer must check his client's solvency by obtaining before the hearing either an irrevocable bank guarantee or a bank cheque made payable to the receiver designated in the conditions of sale or to the Caisse des dépôts et consignations.
The sum, which must represent 10 % of the hammer price but must not be less than €3,000, will be collected and returned at the end of the hearing.
The lawyer must give his client a receipt reproducing the third and fourth paragraphs of the aforementioned article R. 322-41.
In practice, not all courts require the sums to be cashed before the hearing. In some courts, lawyers keep the banker's cheque during the hearing and if they are unable to produce it when asked to do so by a colleague (and usually a competitor in the auction), their last bid is declared void. In other jurisdictions, bank cheques are collected at the entrance to the hearing and returned at the end...
When the sums are collected, the lawyer for the unsuccessful bidder will have to submit a request for disbursement at the end of the hearing in order to return them to his client.
It should be noted that the last paragraph of the text states that if the winning bidder defaults, the escrowed sum is forfeited to the creditors of the proceedings and will be distributed with the price of the property. This means that if the successful bidder fails to pay the sale price and the property is put back up for sale, the escrowed sums are lost.
This can lead to considerable difficulties in jurisdictions where cheques are not cashed and returned immediately after the hearing, insofar as the lawyer is liable in the event of his client's insolvency. Under the old rules, the Court of Cassation ordered a lawyer who had carried out the bidding for an insolvent company to compensate the debtor for the loss suffered (Civ. 2e20 December 2007, no. 06-20.809).
Article L. 322-7-1 of the French Code of Civil Enforcement Procedures states that "A person sentenced to one of the additional penalties provided for in 2° of I of article 225-26 of the French Criminal Code, in 3° of IV and in the second paragraph of V of article L. 1337-4 of the French Public Health Code, in 3° of VII and in the second paragraph of VIII of article L. 123-3 of the French Construction and Housing Code, in 3° of III and in the second paragraph of IV of article L. 511-6 and to 3° of II and to the third paragraph of III of article L. 521-4 of the same code may not bid for the duration of this sentence for the acquisition of a property for residential use or of a business of an establishment receiving the public used wholly or partly for accommodation, except in the case of an acquisition for personal occupation."
The additional penalties mentioned concern the imposition of accommodation conditions incompatible with human dignity, the prohibition on purchasing a property for residential use or a business of an establishment open to the public and used wholly or partly for accommodation, or being a usufructuary of such a property or business following :
These bans result from Law no. 2018-1021 of 23 November 2018 on the evolution of housing, development and the digital economy and Decree no. 2019-488 of 22 May 2019 on persons sentenced to a penalty prohibiting them from bidding, intended to combat sleep merchants.
The legislator wanted to give a control role to a priori to dissuade the persons concerned from bidding. For example, before the auction hearing, the client must provide the lawyer with a certificate stating whether or not he or she has been convicted of a crime that prohibits him or her from bidding. The content of this certificate is detailed in article R. 322-41-1 of the Code of Civil Enforcement Procedures: "Before placing the bids, if the property being seized is a residential property or a business of an establishment open to the public and used wholly or partly for accommodation, the lawyer must also obtain a statement from the principal stating whether or not the principal has been convicted of one of the offences referred to in article L. 322-7-1 and, if the principal is a natural person, whether or not the property is intended for his or her personal occupation. If the principal is a non-trading property company (société civile immobilière) or a general partnership (société en nom collectif), it must also state whether or not its partners and corporate officers have been convicted of any of these offences.
If the principal is a natural person, the certificate shall state his surname, first names, date and place of birth and domicile and, if he was born abroad, the surname and first names of his parents. If the principal is a legal entity, the certificate shall state its name and SIREN number. In the case of a non-trading property company (société civile immobilière) or general partnership (société en nom collectif), the certificate must also include all the information required for its partners and corporate officers, whether they are natural persons or legal entities. The certificate is dated and signed by the principal.
The lawyer must submit this certificate to the court clerk before the end of the hearing, who will check that it does not omit any information required by law. If the certificate does not state that the property is intended for the client's personal occupation, this information will enable the auction registry to consult the client's bulletin no. 2 of the criminal record. In the event of difficulties, the enforcement judge, after seeking comments from the parties, may declare the auction null and void by means of a non-appealable order in which he or she sets a new auction date, in accordance with article R. 322-49-1 of the French Code of Civil Enforcement Procedures: "In the absence of a valid higher bid and when the certificate mentioned in article R. 322-41-1 does not specify that the property is intended for the personal occupation of the principal, the registry service requests the bulletin no. 2 of the criminal record of the bidder declared the successful bidder and, in the case of a non-trading property company or partnership, of its partners and corporate officers.
If the successful bidder or, in the case of a société civile immobilière or en nom collectif, one of its partners or corporate officers, has been sentenced to one of the penalties mentioned in article L. 322-7-1, the court registry refers the matter to the judge who, after requesting observations from the parties, automatically declares the auction sale null and void by means of a non-appealable order in which he sets the new sale hearing for a date within two to four months of the date of his decision.
The court registry shall notify the distrainee debtor, the pursuing creditor, the registered creditors and the successful bidder of the order by registered letter with acknowledgement of receipt.
This order is notified by the court registry to all the parties by registered letter with acknowledgement of receipt.
Article 12.2 of the National Rules of Procedure stipulates that "The lawyer must ascertain from the client, and on the client's declaration, the client's legal capacity, legal situation and, in the case of a legal person, the reality of its existence, the extent of its corporate purpose and the powers of its representative.
Lawyers may not bid for people who have a conflict of interest.
In particular, a lawyer may not place bids for the same property on behalf of several principals.
Where a lawyer has made a bid on behalf of a person, he may not agree to make a higher bid on behalf of another person on that bid, in the absence of the original bidder's written agreement.
In the event of the auction of a co-owned lot or a lot belonging to an Association syndicale libre, it is the responsibility of the pursuing lawyer to notify the syndic of the co-ownership or the manager of the Association syndicale libre.
The lawyer cannot :
The second paragraph of article R. 322-40 of the Code des procédures civiles d'exécution prohibits lawyers from carrying several mandates: "A lawyer may not hold more than one mandate.
Article R. 322-40, paragraph 1, of the Code of Civil Enforcement Procedures states that "Auctions are conducted by a lawyer registered at the bar of the court before which the sale is being conducted.
Just as seizure proceedings can only be conducted by a lawyer registered at the bar of the court with territorial jurisdiction, auctions can only be conducted by a lawyer registered at the bar of the court before which the sale is being conducted.
Article 8, paragraph 2, of the General Provisions of the Terms and Conditions of Sale states that "In order to place bids, the lawyer must obtain from his client all information relating to his client's civil status or name, as well as ascertain from the client, and on the client's declaration, his legal capacity, his legal situation, and if he is a legal person, the reality of his existence, the extent of his corporate purpose and the powers of his representative.
The reference to the civil status details or the name of his clients results from the obligation for the lawyer to declare the identity of his principal to the court clerk at the end of the auction hearing. This identification will enable the enforcement judge to identify the principal in the auction judgement, in accordance with the requirements of articles 6 and 7 of decree no. 55-22 of 4 January 1955.
In addition, as part of his duty to advise, the lawyer must consult all the documents in order to draw his client's attention to any difficulties. For example:
Article R. 322-27 of the French Code of Civil Enforcement Procedures states that "On the date indicated, the pursuing creditor or, failing this, any registered creditor, then subrogated to the pursuit, shall request the sale.
If no creditor requests the sale, the judge declares that the summons to pay serving as a seizure has lapsed. In this case, the defaulting creditor retains all the costs of the seizure unless the court decides otherwise, giving its reasons.
At the auction hearing, the pursuing creditor requests the sale.
Failing this, any registered creditor may request the sale in his place, with the benefit of subrogation.
Furthermore, customs and practices vary from one court to another. In some jurisdictions, the lawyer must propose a bidding step, i.e. the minimum amount that must separate two bids. In other courts, the judge may decide to start the bidding with a round figure if the reserve price is not...
Subject to adaptations made necessary by local practices, the requisition form for the sale will generally be : "I have the honour of requesting the sale by public auction of a type 3 flat with terrace located 221B Baker Street in Marseille, 1e arrondissement, with a Carrez surface area of 275 m². The costs were charged at €5,001.75.
If no creditor applies for the sale, the court will declare that the summons to pay for the seizure of the property has lapsed and will leave the costs of the seizure to be borne by the pursuing creditor, unless a specially reasoned decision is made.
Article R. 322-43 of the Code of Civil Enforcement Procedures states that "The judge will point out that the bidding will start from the amount of the reserve price set, depending on the case, in the terms and conditions of sale or by the court decision provided for in the second paragraph of article L. 322-6.
Article R. 322-44 of the same code adds that "The bids are pure and simple.
Each bid must cover the preceding bid.
Finally, article R. 322-45 states that "Auctions are stopped when ninety seconds have elapsed since the last bid. This time is counted by any visual or audible means that signals to the public each second that has elapsed.
The judge shall immediately establish the amount of the last bid, which shall become the winning bid.
The judge begins by recalling the amount of the upset price, the amount of any taxed costs and the amount of the bidding increment.
Each bid must cover the previous one and when 90 seconds have elapsed since the last bid, this bid wins the auction.
Article L. 322-6, paragraph 1, of the French Code of Civil Enforcement Procedures provides that "The amount of the reserve price is set by the pursuing creditor. In the absence of a bid, the creditor is automatically declared the successful bidder at this amount.
If no bids are received, the pursuing creditor is declared the successful bidder for the amount of the reserve price.
This rule is a major source of liability for the lawyer, who will have to advise his client to set an appropriate reserve price, particularly for syndicates of co-owners, who generally have limited financial capacity and for whom it may be appropriate to set the reserve price at the amount of the claim, in order to be able to set off the claim in the event of no bid to limit the amount of the sums to be disbursed.
Example: the syndicate of co-owners pursues recovery of a debt of €5,000.00 and sets the reserve price at €30,000.00. No bids were received and the syndicat des copropriétaires became the successful bidder at the price of €30,000.00. After offsetting its claim against its debt, it becomes the debtor of the original debtor for €25,000.00.
Article L. 322-6, paragraph 2, of the French Code of Civil Enforcement Procedures provides that "The debtor may, in the event of a manifest inadequacy in the amount of the reserve price, apply to the court to have a reserve price set in relation to the market value of the property and market conditions. However, in the absence of a bid, the debtor may only be declared the successful bidder for the initial reserve price.
Article R. 322-47 of the Code of Civil Enforcement Procedures adds that "In the absence of a bid and when the amount of the reserve price has been modified by the judge, the property is immediately put back up for sale by successive reductions in this amount, if necessary up to the amount of the initial reserve price.
When the judge has been seised of a challenge for manifest inadequacy of the amount of the upset bid, and the auction hearing ends in a lack of bids, he immediately puts the property back up for sale by successive reductions up to the initial upset bid.
In the absence of a bid, the pursuing creditor may only be declared the successful bidder for the initial upset price.
The mechanism makes it possible to protect the pursuing creditor, who is not required to bear the consequences of the absence of a bid resulting from a reserve price set, at the debtor's request, at an excessive amount.
Article R. 322-46 of the Code of Civil Enforcement Procedures states that"Before the end of the hearing, the last-bidding lawyer declares the identity of his principal to the court clerk and gives him the certificate referred to in Article R. 322-41-1.
Article R. 322-61 states that "The deed of sale consists of the enforceable copy of the conditions of sale, which is followed by a transcript of the auction judgement.
If the identity information provided by the successful bidder is incomplete with regard to the requirements of land registration, the successful bidder's lawyer completes it by means of a written declaration delivered to the court clerk's office no later than the third working day following the auction hearing. This additional declaration is attached to the bill of sale. In the event of difficulty, the registry refers the matter to the judge, who makes an order that is not subject to appeal.
If he wins the bid, the lawyer declares the identity of his principal and gives him the certificate of no criminal conviction that he will have obtained from his client.
In some jurisdictions, the identity of the successful bidder is announced at the hearing; in others, it is simply brought to the attention of the court clerk by the handing over of a document containing the required information.
The declaration of identity must include all the information required for publication of the auction judgement and the title of sale, and must therefore comply with the requirements of articles 5 and 6 of decree no. 55-22 of 4 January 1955. In addition, the lawyer must inform the registry of the marital status of his client, who will have been questioned about this beforehand.
If the declaration of winning bidder is incomplete, it can be corrected by means of a supplementary declaration within 3 working days of the auction hearing. This declaration will not correct an error in the winning bidder's declaration.
Article R. 322-48 of the Code of Civil Enforcement Procedures states that "The provisions of this section are prescribed on pain of nullity of the auction raised ex officio.
Any new bid duly placed invalidates the previous bids.
If the last bid is invalid, the auction is automatically invalid.
Article R. 322-49 of the Code of Civil Enforcement Procedures adds that "Challenges to the validity of the bids are made orally at the hearing, through a lawyer. The judge shall rule immediately and, if necessary, immediately resume the bidding under the conditions set out in article R. 322-43.
Lastly, article R. 322-43 of the Code of Civil Enforcement Procedures states that "The judge will point out that the bidding will start from the amount of the reserve price set, depending on the case, in the terms and conditions of sale or by the court decision provided for in the second paragraph of article L. 322-6.
The auction does not have to be declared null and void. It is pronounced ipso jure. However, regular bids cover the nullity of irregular bids, so that only the nullity of the last bid is problematic.
Challenges to the validity of auctions are made orally at the hearing by a lawyer. If the judge finds that the auction is null and void, the auction is resumed. ab initio i.e. on the reserve price set in the conditions of sale or in the court decision setting the reserve price.
Article R. 322-34 of the Code of Civil Enforcement Procedures states that "On the first working day following the sale, and except in the case of a sale carried out after an improved bid, an extract from the minutes of the hearing, mentioning the sale price and the costs charged, is displayed by the registry at the door of the courtroom during the period in which the improved bid may be made.
The extract shall mention the summary description of the immovable as set out in the initial notice, the sale price and the taxed costs, as well as an indication of the registry competent to receive higher bids and the ten-day period following the sale for making them.
Article R. 322-55 of the French Code of Civil Enforcement Procedures adds: "On the day of the hearing, bidding is resumed in accordance with the conditions set out in articles R. 322-39 to R. 322-49, on the basis of the reserve price modified by the higher bid.
If the higher bid is not covered, the higher bidder is declared the successful bidder.
No higher bid may be received on the second auction.
The minutes of the hearing, stating the hammer price and the amount of the taxed costs, are posted on the door of the courtroom by the court clerk's office to encourage higher bids and during the 10-day higher bidding period. In practice, the results of sales are also publicised and relayed by legal gazettes and law firms.
The judge may order additional publicity for the minutes of the hearing, either from the date of the preliminary ruling or within 2 working days of the sale, provided that the matter is referred to him by petition. Article R. 322-37 gives a non-exhaustive list of measures that the judge may order: "An application may be made to the enforcement judge by the pursuing creditor, one of the registered creditors or the distrainee to adjust, restrict or complete the publicity measures provided for in articles R. 322-31 to R. 322-35.
The request is made, depending on the case, at the orientation hearing, no later than two months before the auction hearing or within two working days of the sale.
The judge will take into account the nature, value and location of the property and any other special circumstances.
In particular, it may order :
1° Any other information or document relating to the property must be added to the information provided for in articles R. 322-31 and R. 322-32;
2° That the publicity measures are carried out by other means of communication that it indicates;
3° That the notices referred to in articles R. 322-32 and R. 322-34 are posted at a place designated by the Minister in the municipalities where the property is located.
When the judge rules by order, his decision is not subject to appeal.
The judge's order is not subject to appeal.
Article R. 322-50 of the French Code of Civil Enforcement Procedures states that "Any person may make a higher bid of at least one tenth of the main sale price.
Any person may make a higher bid, provided that they are not subject to any prohibition or incapacity.
Furthermore, a lawyer who agrees to make a higher bid on behalf of a third party after his client has been declared the winning bidder would be in a conflict of interest situation, unless he obtains the agreement of the initial client: "When a lawyer has made a bid on behalf of a person, he may not agree to make a higher bid on behalf of another person on this auction, in the absence of the written agreement of the original successful bidder. (article 12.2 paragraph 4 of the National Rules of Procedure).
Article R. 322-51, paragraph 1, of the Code of Civil Enforcement Procedures states that "On pain of inadmissibility, the higher bid must be made by a lawyer and lodged with the registry of the enforcement judge within ten days of the auction. It shall be deemed to be a request for a hearing on the higher bid.
The higher bid must be made by a lawyer and filed with the auction registry within 10 days of the auction hearing. The higher bid constitutes a request for a higher bid hearing to be set.
Article R. 322-51, paragraph 2, of the Code of Civil Enforcement Procedures states that "The lawyer certifies that he has received from his principal an irrevocable bank guarantee or a bank cheque for one tenth of the principal price of the sale.
The higher bidder must provide his lawyer with an irrevocable bank guarantee or a bank cheque for one tenth of the main sale price (and not the price after an increase of 10 % linked to the higher bid).
The text does not specify to which order the cheque must be made out, nor whether it must be cashed, and in fact, case law has held that cashing the cheque is not a condition of admissibility of the higher bid (Civ. 2e28 June 2012, no. 11-18.121). In practice, however, the cheque or deposit will generally be deposited with the escrow agent designated in the conditions of sale, usually the President of the Bar Association.
Article R. 322-50 of the French Code of Civil Enforcement Procedures states that "Any person may make a higher bid of at least one tenth of the main sale price.
The higher bid must be at least one tenth of the main sale price. As this is a minimum, the higher bidder is free to declare a higher bid.
Article R. 322-51 of the Code of Civil Enforcement Procedures provides, as we have seen, that "Under penalty of inadmissibility, the higher bid must be made by a lawyer and lodged with the registry of the enforcement judge within ten days of the auction. It is deemed to be a request for a higher bid hearing to be set.
The lawyer certifies that he has received from his principal an irrevocable bank guarantee or a bank cheque for one tenth of the principal price of the sale.
The declaration of higher bid may not be retracted.
The higher bid declaration is made in accordance with the conditions set out in the aforementioned article R. 322-51.
It is filed with the auction clerk's office by a lawyer's deed and constitutes the setting of a higher bid hearing.
It must include all the information required to identify the agent with regard to land registration rules.
It will include, as an appendix, the certificate of delivery of the bank cheque or irrevocable bank guarantee for one tenth of the principal price of the sale.
It cannot be retracted.
Article R. 322-52, paragraph 1, of the Code of Civil Enforcement Procedures states that "No later than the third working day following the declaration of higher bid, the higher bidder shall notify the pursuing creditor, the successful bidder and the distrainee of the higher bid by bailiff's deed or by notification between lawyers, failing which the bid will be inadmissible. The notice of termination shall state the provisions of article R. 311-6 and the second paragraph of this article; a copy of the certificate provided for in the second paragraph of article R. 322-51 shall be attached thereto.
The declaration of higher bid must be notified to the debtor, the pursuing creditor and the successful bidder within 3 working days of its filing with the auction registry, failing which it will be inadmissible. It is notified by a bailiff's deed if the party concerned does not have a lawyer, failing which it may be notified by lawyers.
However, there is no provision for notifying registered creditors.
The denunciation must be accompanied not only by the declaration of outbidding, but also by proof of delivery of the bank cheque or irrevocable bank guarantee for one tenth of the main sale price.
Article R. 322-52, paragraph 2, of the Code of Civil Enforcement Procedures states that "The validity of the higher bid may be challenged within fifteen days of its notification.
Article R. 311-6, paragraphs 1 and 3, of the Code of Civil Enforcement Procedures, for the record, states that disputes must be submitted in the form of pleadings "Unless otherwise stipulated, any challenge or incidental claim shall be lodged with the court clerk's office by means of submissions signed by a lawyer.
[...]
If the challenge or incidental claim cannot be examined at the orientation hearing, the court clerk's office will summon the parties to a hearing by registered letter with acknowledgement of receipt within fifteen days of the challenge or claim being lodged.
The higher bid must be contested within 15 days of its notification by filing a lawyer's brief with the auction clerk's office.
The clerk's office will summon the parties by registered letter with acknowledgement of receipt within 15 days of the lodging of the dispute.
The judgment handed down at the end of the procedure will be subject to appeal and will then be judged, like the referral judgment, according to the procedure set out in article 905 of the Code of Civil Procedure, in accordance with article R. 311-7, paragraph 1, of the Code of Civil Enforcement Procedures: "Unless otherwise provided, judgements may be appealed. The appeal must be lodged within fifteen days of notification. Subject to the provisions of article R. 322-19 and unless a fixed date procedure is used, the appeal is heard in accordance with the procedure set out in article 905 of the Code of Civil Procedure".
Article R. 322-53 of the Code of Civil Enforcement Procedures states that "The higher bid hearing is set by the enforcement judge for a date between two and four months following the declaration of higher bid.
If the higher bid declaration is contested, this period runs from the date of the rejection decision.
The distrainee debtor, the pursuing creditor, the registered creditors, the successful bidder and the higher bidder are notified by the court registry of the date of the hearing by registered letter with acknowledgement of receipt.
Following the declaration of higher bid, the enforcement judge will set a date for the auction hearing between +2 and +4 months following the declaration of higher bid.
The suspension of the declaration of higher bid suspends this period, so that in practice, the parties will be notified of the date of the auction hearing by the registry from the expiry of the 15-day objection period, which runs from the date of notification of the declaration of higher bid.
Article R. 322-54 of the Code of Civil Enforcement Procedures states that "The publication formalities are carried out at the behest of the higher bidder or, failing that, the pursuing creditor, on the basis of the upset price modified by the higher bid.
Article 10, paragraph 4, of the General Provisions of the Terms and Conditions of Sale reiterates: "If there is more than one higher bidder, the formalities for advertising will be carried out by the lawyer of the first higher bidder. Failing this, the creditor who pursued the first sale may do so.
The advertising formalities are identical in all respects to those for a traditional auction sale, in terms of advertising, informing third parties to the proceedings and visiting the seized property. The only differences concern the amount of the reserve price, which will be equal to the amount of the higher bid.
The general provisions of the terms and conditions of sale add that in the event of multiple bidders, the advertising formalities will be completed by the first bidder, failing which they will be completed by the creditor who pursued the first sale.
These formalities will be carried out either by the higher bidder or by the pursuing creditor, in accordance with the customs and practices of the bars and law firms, but also in accordance with the requirements of the law. desideratas of the parties. This question, far from being trivial, can have serious consequences for the pursuing creditor.
In fact, when the higher bidder carries out the publication formalities, the procedure initially initiated by the pursuing creditor is left to the higher bidder, whereas the time limits within which the publication formalities must be carried out are stipulated, failing which the summons will lapse. The pursuing creditor may legitimately fear that his proceedings will be jeopardised by a third party.
The taxation of legal costs will be subject to the same rules as at the auction hearing, but will be limited to the costs incurred and the fees paid in connection with the higher bid.
Article R. 322-54 of the Code of Civil Enforcement Procedures states that "On the day of the hearing, bidding is resumed in accordance with the conditions set out in articles R. 322-39 to R. 322-49, on the basis of the reserve price modified by the higher bid.
If the higher bid is not covered, the higher bidder is declared the successful bidder.
No higher bid may be received on the second auction.
The provisions of article R. 322-49-1 are applicable.
The outbidding hearing takes place in exactly the same way as the bidding hearing, subject to two reservations:
Information for third parties to the proceedings in fine to enable them to exercise their right of substitution or their right of pre-emption. Thus :
|
Tenant or occupier in good faith |
Rural leaseholder |
SAFER |
Public authorities |
|
|
Pre-emption period |
1 month from notification of the sale by the registry |
20 days |
20 days |
30 days |
Article L. 322-10 of the French Code of Civil Enforcement Procedures states that "The auction results in the forced sale of the seized property and transfers ownership to the successful bidder.
It does not confer on the latter any rights other than those belonging to the distrainee. The latter is bound, with regard to the purchaser, to deliver the property and to guarantee against eviction.
Article 12, paragraph 1, of the General Provisions of the Terms and Conditions of Sale reiterates: "The purchaser will be the owner by the sole effect of the sale, unless he exercises a right of pre-emption or equivalent rights in accordance with the law.
The property transfer effect of the auction is :
The immediate effect of the transfer not only means that the debtor will have to insure the property as soon as the hearing is over, but also that he will be the owner before he has paid the sale price, taxed costs and emoluments.
The distrainee, who is obliged to deliver the property and guarantee against eviction, must vacate the premises immediately. If he fails to do so, the purchaser may request payment of an occupancy indemnity (Civ. 2e11 March 2010, no. 09-12.712), as stated in the second paragraph of article 20 of the general provisions of the terms and conditions of sale: "The purchaser shall be personally responsible for any necessary evictions, without recourse to any party, and shall be entitled to any occupancy indemnities that may be due.
If the property is the subject of a higher bid, the successful bidder remains the owner of the premises until the higher bid hearing and the appointment of a new higher bidder (Civ. 2e17 November 2011, no. 10-20.957).
As a corollary of the immediate effect of the transfer of ownership, the successful bidder is required to insure the property immediately. Paragraphs 3 to 5 of the general provisions of the terms and conditions of sale reiterate this and specify the applicable penalties: "The purchaser will be obliged to insure the property against all risks, particularly fire, with a solvent insurance company, for a sum at least equal to the price of the compulsory sale.
In the event of a claim before the price has been paid in full, the indemnity shall automatically belong to the seizing party or to the creditors referred to in article L.331-1 of the Code of Civil Enforcement Procedures up to the amount of the balance due on the said price in principal and interest.
In the event of a claim that is not covered due to the fault of the purchaser, the latter shall nevertheless be liable for pay its price in addition to the accessories, costs and expenses of the sale.
Article L. 322-9 of the Code of Civil Enforcement Procedures states that "The successful bidder pays the price into an escrow account or deposits it with the Caisse des Dépôts et Consignations and pays the costs of the sale.
He may not, prior to the payment or deposit and payment, carry out any act of disposal on the property with the exception of the creation of a mortgage accessory to a loan contract intended to finance the acquisition of this property.
Article 12, paragraphs 2 and 3, of the General Provisions of the Sales Terms and Conditions stipulates that "The purchaser may not, prior to payment of the purchase price and costs, carry out any act of disposal on the property, with the exception of the creation of a mortgage ancillary to a loan contract intended to finance the acquisition of the property.
Before the price has been paid in full, the purchaser may not make any significant change, demolition or extraordinary felling of wood, nor commit any deterioration in the property, failing which he will be obliged to immediately deposit his price, even by reopening the auction.
The Code of Civil Procedure strictly prohibits the successful bidder from carrying out an act of disposal, except for the constitution of a mortgage accessory to a loan contract intended to finance the acquisition of the property.
The terms and conditions of sale are more flexible as they simply prohibit the successful bidder from making a "significant change in the property, without however defining this concept, about which case law is rare.
Article 20, paragraph 1, of the general provisions of the terms and conditions of sale provides for a deferment of the commencement of enjoyment in certain cases: "The purchaser, although owner by the mere fact of the sale, will enter into enjoyment :
In the case of a property seizure, the transfer of ownership, the freedom to dispose of the property and the entry into possession take place at different times, whereas in the case of a traditional sale, they take place when the deed of sale is signed. This often gives rise to difficulties of understanding on the part of the successful bidders, which the lawyer will need to anticipate.
Article 21 of the general provisions of the sales conditions stipulates that "The purchaser shall bear the contributions and charges of all kinds to which the property is or will be subject from the date on which the judgment on the compulsory sale is delivered.
If the property sold is co-owned, the successful bidder will be required to pay the co-ownership charges due from the date of the judgement on the compulsory sale.
As for the property tax, it will be reimbursed to the prorata temporis at the first request of the previous owner and on presentation of the receipted tax assessment.
Sales by auction are, for the buyer, sales without recourse against the distrainee debtor, the pursuing creditor and the registered creditors. This absence of recourse is systematically stated in the general provisions of the sales conditions:
Article 3, concerning the building and its contents : "The purchaser will take the property in the condition in which it is on the day of the sale, without being able to claim any reduction in price, or any guarantee or indemnity against the pursuing party, the distraining party or its creditors for damage, repairs, lack of maintenance, latent defects, construction defects, obsolescence, errors in the description, consistency or capacity, even if the difference exceeds one twentieth, nor by reason of the rights of joint ownership or overloading of the walls separating the said property from neighbouring properties, even if these rights are still due and without guarantee of the nature or solidity of the soil or subsoil by reason of the quarries and excavations that may have been made under its surface, the excavations that may have been made, the backfill that may have been made, the landslides and landslides.
The purchaser will have to deal with this personally, at his own risk, without any recourse against anyone else.
In accordance with the provisions of article 1649 of the French Civil Code, the purchaser will not benefit from any guarantee against hidden defects.
Article 4, paragraph 1, concerning leases: "The purchaser will be personally responsible for any outstanding leases for the remainder of the term.
However, leases granted by the debtor after delivery of the summons to pay in the event of seizure cannot be set up against the pursuing creditor or the purchaser. Proof of the lease's anteriority may be provided by any means.
The purchaser will be subrogated to the rights of the creditors in order to cancel, if necessary, any agreements that may have been entered into in fraud of their rights.
It will take into account, in addition and without reducing its price, the rents paid in advance by the various tenants or any security deposits paid to the distraining party and will be subrogated purely and simply, both actively and passively, in the rights, actions and obligations of the distraining party.
In Article 5, concerning pre-emption rights and the right of substitution : "Pre-emptive or similar rights will apply to the purchaser in accordance with the law.
If the purchaser is evicted as a result of one of these rights, he shall have no recourse against the pursuer by reason of the immobilisation of the sums paid by him or by reason of the prejudice which could be caused to him.
In Article 6, paragraphs 1 and 2, concerning contracts and subscriptions : "The purchaser shall be personally responsible for any contracts or subscriptions relating to the building that may have been or should have been taken out, without any recourse against the debtor or the lawyer who drafted the conditions of sale.
Under no circumstances can the pursuer be held liable for the absence of insurance.
Finally, in Article 7, concerning easements: "The purchaser will enjoy the active easements and will suffer all the passive easements, hidden or apparent, declared or not, whether they result from the laws or regulations in force, from the location of the property, from contracts, from prescription and generally whatever their origin or nature as well as the effect of the clauses known as domanial, except to assert some and to defend against others, at his risks, perils, expenses and fortune, without recourse against anyone.
On the enforceability of leases, see supra.
Article R. 322-56 of the Code of Civil Enforcement Procedures states that "Payment to the escrow agent or deposit with the Caisse des Dépôts et Consignations of the price for which the successful bidder is liable under article L. 322-12 must be made within two months of the date of the final sale, failing which the bids will be repeated. Once this period has elapsed, the sale price is automatically increased by interest at the legal rate until the price has been paid in full or deposited.
Article R. 322-57 of the Code of Civil Enforcement Procedures then provides that "When the funds are held in escrow, they earn interest at a rate set by the terms and conditions of sale, which may not be less than the interest rate paid by the Caisse des dépôts et consignations. The interest accrues to the creditors and, where applicable, to the debtor, and is distributed to them together with the price of the property.
Lastly, article R. 322-58 of the Code of Civil Enforcement Procedures states that "The costs of legal proceedings and, where applicable, any higher bids and transfer duties are paid by the successful bidder in addition to the price. Proof of this must be provided to the court clerk's office before the expiry of a period of two months from the date of the final award, failing which the bids may be repeated.
Any stipulation to the contrary is deemed unwritten.
The successful bidder has 2 months from the date of the auction to pay the sale price. However, he must first pay the costs of the legal proceedings and, if applicable, the higher bid, as well as the transfer duties. Please note that :
It is therefore in the buyer's interest to pay the sale price between +1 and +2 months from the date of the auction hearing, so that the overbidding and pre-emption periods are purged at the time of payment.
The sale price must be paid into the hands of the receiver designated in the terms and conditions of sale, i.e. into the hands of the President of the Bar Association.
Article R. 322-10, paragraph 2, 6° of the Code of Civil Enforcement Procedures stipulates that the conditions of sale must designate a receiver: "The conditions of sale contain, under penalty of nullity :
[...]
6° The appointment of a receiver of the funds from the sale or from the Caisse des dépôts et consignations.
And the general provisions applicable to property seizures require the President of the Bar Association to be appointed in this capacity: "The funds to be generated by the sale decided by the enforcement judge will be sequestered in the hands of the President of the Bar Association of the bar of the applicant lawyer for distribution to the creditors referred to in article L. 331-1 of the Code of Civil Enforcement Procedures.
On receipt of the funds, the escrow agent will issue a receipt to the successful bidder.
If payment is not made within the aforementioned period of 2 months, the successful bidder will be liable to pay interest at the legal rate, increased by 5 points at the end of a period of 4 months from the date of the sale, in accordance with Article 15, paragraphs 1 to 4, of the General Provisions of the Terms and Conditions of Sale: "No later than the expiry of the two-month period following the final sale, the purchaser will be obliged, failing which the bids will be repeated, to pay the principal price into the hands of the designated receiver, who will issue a receipt.
If the price is paid in full within two months of the final sale, the purchaser will not be liable for any interest.
Once this two-month period has elapsed, the balance of the price still owing will automatically be increased by interest calculated at the legal rate from the date of the adjudication.
The legal interest rate will be increased by five points at the end of the four-month period following the pronouncement of the auction judgement, in accordance with Article L. 313-3 of the French Monetary and Financial Code.
Please note that legal interest, if applied, will be calculated from the date of the final sale, i.e. on expiry of the higher bidding period, or if the sale is by higher bidding, from the date of the sale hearing. The 5-point increase will always be applied at the end of the 4-month period following the date of the auction hearing.
It should be noted that the debtor remains the owner of the funds until the end of the distribution procedure. He will therefore be the creditor of the successful bidder, liable for interest at the legal rate. Because of this creditor status, whether the debtor is a professional or a private individual will determine the type of legal rate applicable, bearing in mind that the legal rate applicable to private individuals is much higher than the legal rate applicable to professionals.
In practice, the seized debtor will almost always be a private individual, since the seizure and sale by public auction of the real estate of professionals will, in any event, take place at the end of a judicial liquidation auction, a specific procedure that is not dealt with here.
The sums deposited will automatically bear interest until payment of the sums distributed, at the rate of 105 % of that paid by the Caisse des dépôts des consignations, in accordance with article 13, paragraph 3, of the general provisions of the sales conditions: "The escrowed funds earn interest at the rate of 105% of that paid by the Caisse des dépôts et consignations for the benefit of the debtor and the creditors, from the time they are collected until they are distributed.
Lastly, the successful bidder who does not comply with all of his obligations will bear the costs of registering and cancelling the seller's lien, if the seller sees fit to register it, in accordance with paragraph 5 of article 15 of the general provisions of the conditions of sale: "A buyer who has not paid the sale price in full within two months shall bear the cost of registering the seller's lien, if the seller sees fit to do so, and of subsequently cancelling it.
The co-purchasers will be jointly and severally liable for payment of the price and performance of the conditions of the forced sale (article 18 of the general provisions of the terms and conditions of sale).
Article R. 322-58 of the Code of Civil Enforcement Procedures states that "The costs of legal proceedings and, where applicable, any higher bids and transfer duties are paid by the successful bidder in addition to the price. Proof of this must be provided to the court clerk's office before the expiry of a period of two months from the date of the final award, failing which the bids may be repeated.
Any stipulation to the contrary is deemed unwritten.
The successful bidder must pay the costs of the legal proceedings and, where applicable, any higher bidding costs by priority in addition to the price.
The statement of costs submitted to the tax by the pursuing creditor included the fees due for the work carried out, but could not include the proportional fee divided between the lawyers of the pursuing creditor and the successful bidder, as its amount depends on the sale price and the terms of the procedure.
The calculation of this proportional fee is based on the combined application of articles A. 444-191 and A. 444-102 of the French Commercial Code. The scale is as follows:
|
SLICES OF PLATE |
APPLICABLE RATE |
|
From €0 to €6,500 |
7,256 % |
|
From €6,500 to €17,000 |
2,993 % |
|
From €17,000 to €60,000 |
1,995 % |
|
More than €60,000 |
1,497 % |
The pursuing party's lawyer receives three quarters of the fee, while the successful bidder's lawyer receives the remaining quarter.
In the case of higher bids, the lawyer who pursued the first sale and the higher bidder together receive three quarters of the fee. The text specifies that the ratio between the emolument of one and the other must be equal to the ratio between, on the one hand, the original auction price and, on the other hand, the difference between the auction price of the higher bid and the original auction price". (article A. 444-191 of the French Commercial Code).
It should be noted that the proportional fee payable to the pursuing lawyer is higher in the case of a sale by auction than in the case of an amicable sale, as the procedure is longer and more complex to implement.
The first paragraph of Article 16 of the General Provisions of the Terms and Conditions of Sale gives the successful bidder a period of one month in which to pay the taxed costs and emoluments: "In accordance with article 1593 of the French Civil Code, the purchaser shall pay to and on receipt of the pursuing lawyer, in addition to the price and within one month of the final sale, the sum to which the costs of the legal proceedings and the amount of the fees set in accordance with the tariff in force, plus the applicable VAT, have been charged.
However, the text does not provide for any penalties, and the taxed costs and emoluments will generally be paid at the same time as the sale price, i.e. between +1 and +2 months from the auction hearing, so that the overbidding and pre-emption periods are purged on the date of payment.
In practice, the pursuing creditor's lawyer must provide the successful bidder's lawyer with receipts certifying payment of the taxed costs and emoluments. The receipt for costs must be attached to the bill of sale, which prevents the auction registry from issuing it before receiving it.
Article R. 322-58 of the Code of Civil Enforcement Procedures provides, as we have seen, that "The costs of legal proceedings and, where applicable, any higher bids and transfer duties are paid by the successful bidder in addition to the price. Proof of this must be provided to the court clerk's office before the expiry of a period of two months from the date of the final award, failing which the bids may be repeated.
Any stipulation to the contrary is deemed unwritten.
Transfer duties are claimed either from the successful bidder's lawyer or from the successful bidder, depending on custom, by the Treasury, and must be paid within one month of the auction hearing (article 635 2 1° of the French General Tax Code).
The amount is calculated according to the following formula
|
Selling price * 4.50 % |
Result A |
|
Selling price * 1.20 % |
Result B |
|
Result A * 2.37 % |
Result C |
|
Total |
A + B + C |
For example:
|
135 000 * 4,50 % |
6 075 € |
|
135 000 * 1,20 % |
1 620 € |
|
6 075 * 2,37 % |
1 44 € |
|
Total |
7839 € |
Caution! Estate agents are partially exempt from transfer duties under certain conditions.
Article 17 of the General Provisions of the Terms and Conditions of Sale adds that the successful bidder must provide proof of payment of transfer duties to the Registry of Auctions within 2 months of the auction: "The purchaser will be required to pay, in addition to the price, and by priority, all registration duties and other duties to which the forced sale will give rise. He must provide proof of this to the registry within two months of the date of the final adjudication.
If the property being sold is subject to VAT, the sale price is exclusive of tax. In this case, the purchaser must pay to the Treasury, by order and on behalf of the vendor (the distraining party) and on his behalf, in addition to the sale price, the duties arising from the VAT system that the vendor may be liable to pay as a result of the forced sale, taking into account his right to deduct, unless the purchaser avails himself of other tax provisions, in which case the payment of the resulting duties will be in full discharge of his liability.
Any duties that may be due or levied in connection with rentals will be payable by the purchaser only for the period after he takes possession, subject to his recourse, if any, against his lessee.
The purchaser shall be personally responsible, without recourse against anyone else, for the amount of and proof of the deduction rights that the seller may claim from the tax authorities.
In practice, the clerk's office issues the auction judgement and sends it to the tax authorities for registration. The request for payment of the transfer duties is then sent to the successful bidder's lawyer. Once the duties have been paid, the auction judgement is returned to the clerk's office, bearing a sticker proving that it has been properly registered.
Article R. 322-59 of the French Code of Civil Enforcement Procedures states that "In addition to the information required for all judgements, the auction judgement shall refer to the orientation judgement, the judgements ruling on disputes and the conditions of sale. It designates the pursuing creditor and, where applicable, the creditor subrogated to its rights. It mentions the publicity formalities and their date, the description of the property sold, the date and place of the forced sale, the identity of the successful bidder, the auction price and the amount of taxed costs. Where applicable, it includes any disputes that it resolves.
The adjudication :
Article L. 322-13 of the French Code of Civil Enforcement Procedures states that "The auction judgement constitutes a writ of eviction against the distrainee.
Article R. 322-64 of the Code des procédures civiles d'exécution adds that the adjudication constitutes an eviction order, not only against the distrainee, but also against any occupant of the property who has no enforceable right: "Unless the terms and conditions of sale provide for the distrainee debtor to remain on the premises, the successful bidder may enforce the eviction order that he has against the distrainee and any of his occupants who do not have any rights enforceable against him from the time the price is paid or deposited and the taxed costs are paid.
Eviction proceedings initiated on the basis of an adjudication judgment cannot be suspended: "If the debtor's situation so requires, the judge shall order the provisional suspension of measures to evict the debtor from his home, with the exception of those based on an adjudication ruling made in relation to the seizure of property and those ordered on the basis of the third paragraph of article 2198 of the Civil Code. (article L. 322-8 of the French Consumer Code).
Lastly, article 20, paragraph 3, of the general provisions of the terms and conditions of sale specifies that eviction proceedings may only be initiated once the price has been deposited and the taxed costs have been paid: "The purchaser may enforce the eviction order that he has against the distrainee and any occupant of the property who has no rights against him, as soon as the price has been deposited and the taxed costs have been paid.
This means that the judgment of sale constitutes an eviction order against the distrainee debtor and any occupant on his behalf from the date of payment of the price and its deposit and payment of the taxed costs, unless the terms and conditions of sale provide for the distrainee debtor to remain in the premises.
On the other hand, any lease entered into prior to the issue of the summons to pay for the property will be enforceable against the successful bidder.
Lastly, the enforcement judge, to whom the matter has been referred by the chairman of the over-indebtedness commission, cannot order the suspension of the eviction order in the case of a property seizure.
These provisions enable the bailiff to initiate eviction proceedings within the meaning of articles L. 411-1 et seq. and R. 411-1 et seq. of the Code of Civil Enforcement Procedures, and to request the assistance of the police for this purpose in application of article L. 153-2 of the same code.
Article L. 322-14 of the French Code of Civil Enforcement Procedures states that "The payment of the price or its deposit and the payment of the costs of the sale automatically release the property from all mortgages and liens on the debtor from the date of publication of the title of sale.
Article R. 322-65 of the same code stipulates that "At the request of the successful bidder, the enforcement judge, who notes that the mortgages and liens taken out on the property by the debtor have been purged, orders the removal of the corresponding entries from the property register.
The order is not subject to appeal.
Finally, article 23 of the general provisions of the sales conditions stipulates that "The sequestration or deposit of the price and the payment of the costs of the sale automatically release the property from all mortgages and liens.
Prior to the distribution procedure, the purchaser may apply to the enforcement judge to have the registrations on the property cancelled.
In this case, the purchaser will be required to advance all costs of discharge or cancellation of the registrations encumbering the property, which he or she may request to be reimbursed as part of the distribution of the price under the provisions of article 2375, 1° of the Civil Code".
A sale by auction automatically removes all mortgages and liens against the debtor. However, as in the case of an out-of-court sale with judicial authorisation, this purge is not automatic and the write-offs will be ordered at the end of the procedure for distributing the funds.
However, the average duration of the procedure for distributing the funds is 6 to 8 months, and it can only begin once the title deed has been published, which the registry will issue on receipt of the receipt for payment of the taxed costs. This means that the registrations will be cancelled as a minimum between 8 and 12 months after the auction hearing. In the meantime, the successful bidder will not be able to resell the property, as it will continue to be encumbered by the registrations and liens taken out against the seized debtor.
To overcome this deadlock, the successful bidder may ask the enforcement judge, by way of a petition, to order the cancellation of the registrations and liens taken out on the property by the debtor.
The order is not subject to appeal. It will therefore be notified by the auction registry, in accordance with the second paragraph of article R. 311-7 of the Code of Civil Enforcement Procedures: "Decisions are notified by service. However, when, by virtue of a specific provision, the enforcement judge rules by means of an order rendered at last instance, his decision is notified by the registry simultaneously to the parties and their lawyers. The same applies to notification of a decision to opt for an out-of-court sale where the debtor has not set up a lawyer and of decisions made pursuant to articles R. 311-11 and R. 321-21.
The cancellation of mortgages and liens will be carried out by the land registry when the order is published in the real estate register.
The original and a copy of the deregistration order, duly certified, must be sent to the relevant land registry, together with a cheque made payable to Treasury in payment of deregistration fees of :
The application may be accompanied by a request for a status on formality (CERFA no. 3233-SD) to prove that the publication has been registered without waiting for the deed to be returned, which can take a very long time. The cost will be :
The successful bidder must also bear the costs of cancelling the registrations and liens taken out against the debtor.
Article R. 322-60, paragraph 1, of the Code of Civil Enforcement Procedures states that "The auction judgement is notified by the pursuing creditor to the debtor, to the registered creditors, to the successful bidder and to any person who has raised a dispute that is settled by the decision.
Notification is effected by the pursuing creditor in accordance with the provisions of articles 677 and 678 of the Code of Civil Procedure, i.e. by notification between lawyers and/or service on parties.
The reference to registered creditors is sometimes interpreted as a reference to registered creditors who have declared their claims in the proceedings. However, this interpretation of the text is open to criticism, insofar as registered creditors, even if they have not declared their claim, remain fully interested in the outcome of the proceedings.
The absence of a declaration of claim has the effect of downgrading their registration to unsecured rank, but in no way excludes them from the scope of the procedure for the distribution of funds that will be initiated at a later date. In addition, the auction judgement has the effect of purging all registrations made in respect of the debtor.
Developments in case law, particularly in relation to the procedure for appealing against a referral order, support this analysis, since the Court of Cassation considers that the principle of indivisibility of the appeal requires registered creditors who have not declared their claim to be notified of the proceedings (Cass. civ., 2e, 2 Dec. 2021, no. 20-15.274).
In any event, registered creditors who have not declared their claims in the proceedings are probably counted among the parties to the proceedings in the heading of the judgments, the enforcement judge having been informed of their presence at the time of filing at the registry of the denunciations of the writ of summons for the orientation hearing. It should be noted, however, that this common-sense practice, which is in line with the current state of positive law, is not used in all courts and that registered creditors who do not declare their claims are sometimes not counted among the parties to the proceedings.
On the other hand, the text clearly excludes notification of the judgement to a higher bidder who has not been declared the winning bidder.
Article 7 II and III of the Decree of 30 June 1977 stipulates that "II - The tenant or occupant acting in good faith must be notified of any judgement or minutes of the auction, by the clerk of the court or notary before whom the auction was pronounced, between the tenth and fifteenth day following the auction.
The tenant or bona fide occupant is notified of the sale by auction between 10e and 15e day following the sale.
The text adds that the tenant or occupant in good faith must be notified of the outbidding sale between 10e and 15e day following the judgment assessing the validity of the higher bid. However, any disputes arising from the sale will be settled immediately, so that the time limit will be identical in both cases, since the adjudication judgment will always be handed down on the same date as the auction hearing.
Article 20 I of law no. 65-557 of 10 July 1965 stipulates that "I.-When a lot is transferred for valuable consideration, and if the vendor has not presented the notary with a certificate from the building manager less than one month old, certifying that he is free of any obligation to the building association, the notary must give notice of the transfer to the building manager by registered letter with acknowledgement of receipt within fifteen days of the date of transfer of ownership. Before the expiry of a period of fifteen days from receipt of this notice, the syndic may, by extrajudicial act, lodge an objection at the elected domicile to the payment of the funds within the following limit in order to obtain payment of the sums still owed by the former owner. This objection must be made within the jurisdiction of the court in which the property is located and, under penalty of nullity, must state the amount of the claim and the grounds on which it is based. The notary releases the funds as soon as the trustee and the vendor agree on the outstanding sums. Failing agreement, within three months of the syndicate lodging a valid objection, the notary pays the sums withheld to the syndicate, unless the objection is contested in court by one of the parties. The effects of the objection are limited to the amount thus stated.
Any amicable or judicial payment or transfer of the price made in breach of the provisions of the preceding paragraph shall not be enforceable against the trustee who has duly lodged an objection.
If the objection is duly lodged, the lien referred to in Article 19-1 is exercised in favour of the syndicate.
Article 5-1 of Decree no. 67-223 of 17 March 1967 stipulates that "For the application of the provisions of article 20 of the law of 10 July 1965 as amended, only the syndicate's claims that are actually liquid and due on the date of the transfer are taken into account.
Any objection lodged by the trustee must state precisely :
1° The amount and reasons for the building association's debts relating to the charges and works mentioned in articles 10 and 30 of the law of 10 July 1965 for the current year and the two previous years;
2° The amount and the reasons for the syndicate's debts relating to the charges and work mentioned in articles 10 and 30 of the law of 10 July 1965 for the two years prior to the last two years due;
3° The amount and causes of the syndicate's claims of all kinds secured by a legal mortgage and not included in the preferential claims referred to in 1° and 2° above;
4° The amount and the reasons for the syndicate's claims of any kind not included in the claims referred to in 1°, 2° and 3° above.
If the lot is the subject of a sale by auction or seizure, the notice of transfer provided for in article 20 of the aforementioned law of 10 July 1965 is given to the managing agent, as appropriate, either by the notary or by the lawyer for the plaintiff or the pursuing creditor; if the lot is subject to expropriation in the public interest or the exercise of a public right of pre-emption, the notice of transfer is given to the managing agent, depending on the case, either by the notary or by the expropriator, or by the holder of the right of pre-emption; if the deed is received in administrative form, the notice of transfer is given to the managing agent by the authority that authenticates the agreement. "
Article 27 of the general provisions of the sales conditions stipulates that "The plaintiff's lawyer must notify the condominium manager of the notice of transfer provided for in article 20 of the law of 10 July 1965 (amended by law no. 94-624 of 21 July 1994).
This notification must be made within fifteen days of the sale becoming final and must state that any objection to payment of the sums still owed by the former owner must be served at the address of the pursuing lawyer.
The purchaser's lawyer, independently of the above notification, where the property sold is part of a condominium complex, in accordance with article 6 of decree no. 67-223 of 17 March 1967, is required to notify the managing agent, as soon as the sale is final, by registered letter with acknowledgement of receipt, of the designation of the lot or fraction of a lot, the surname, first name and real or elected domicile of the purchaser. "
Article 3(3) of Order no. 2004-632 of 1 July 2004 states that "In the event of the transfer of a property included within the perimeter of an association syndicale, notice of the transfer must be given, under the conditions provided for in article 20 of law no. 65-557 of 10 July 1965 laying down the status of co-ownership of built-up properties, to the association, which may lodge an objection under the conditions provided for in the said article to obtain payment of the sums still owed by the former owner.
Finally, article 28 of the general provisions of the sales conditions stipulates that "The debtor's lawyer must notify the legal representative of the Association syndicale libre or the Association syndicale autorisée of the notice of transfer under the terms of article 20 of law no. 65-557 of 10 July 1965, in accordance with order no. 2004-632 of 1 July 2004.
This notification must be made within fifteen days of the sale becoming final and must state that any objection, seeking payment of the sums still owed by the former owner, must be served at the address of the pursuing lawyer.
The syndic de copropriété and the president of the association syndicale libre must be informed of the transfer of lots within 15 days of the transfer of ownership. However, in the case of auctions, the transfer of ownership is immediate. This means that the pursuing creditor must notify them of the transfer without waiting for the expiry of the higher bid and pre-emption periods.
Notification is made by registered letter with acknowledgement of receipt.
The syndicat des copropriétaires and the association syndicale libre have 15 days from receipt to lodge an objection by extrajudicial deed to the payment of the funds.
The objection constitutes opposition to the payment of the funds within the limits of the amount and the grounds of the claim, which are mentioned on pain of nullity. The objection includes an address for service within the jurisdiction of the court in which the property is located.
Articles 27 and 28 of the General Provisions of the Terms and Conditions of Sale add that the objection must be served at the domicile of the pursuing creditor's lawyer.
In addition, as soon as the sale is final, the successful bidder's lawyer must notify the syndic by registered letter with acknowledgement of receipt of the designation of the lot or fraction of a lot and the surname, first name and real or elected domicile of the successful bidder.
Article R. 321-20, paragraph 1, of the Code of Civil Enforcement Procedures states that "A summons to pay in the form of a seizure ceases to have effect ipso jure if, within five years of its publication, no mention has been made in the margin of this publication of a judgement recording the sale of the seized property.
Publication of the auction judgement on the margin of the summons to pay for the seizure of the property puts an end to the 5-year limitation period for the summons to pay for the seizure of the property.
To obtain publication, you must send the original and a copy of the auction judgement, duly certified, to the relevant land registry, together with a cheque made payable to Treasury of €15. This publication may be accompanied by a request for a statement of publication (CERFA n° 3233-SD), the cost of which will be :
Article R. 322-60, paragraph 2, of the Code of Civil Enforcement Procedures states that "Only an adjudication ruling on a dispute may be appealed on this ground within fifteen days of its notification.
The auction judgement may only be appealed if it rules on a dispute, in which case the appeal is only admissible in respect of the part of the judgement that ruled on the dispute (Poitiers Court of Appeal, 16 October 2009, no. 09/00898).
However, the right to appeal to the Supreme Court remains open where the auction judgement cannot be appealed on the grounds that it is ultra vires (Civ. 2e22 November 2001, no. 00-13.773; Civ. 2e6 December 2012, no. 11-24.028).
Notwithstanding the provisions of paragraph 2 of article R. 322-60 of the Code des procédures civiles d'exécution, which limits the right of appeal to the auction judgement that rules on a dispute, the Cour de cassation has long maintained a restrictive jurisprudence according to which an auction judgement that has not ruled on any dispute is not subject to appeal, unless it is ultra vires :
The rulings of the Court of Cassation do not make it possible to determine whether an adjudication ruling on a dispute is subject to a remedy other than appeal.
Case law has long held that an adjudication judgment is not subject to review: "Whereas the adjudication decision, which does not rule on any incident, merely establishes a judicial contract and does not have the character of a judgment ;
That it cannot therefore be the subject of an appeal such as an application for review;". (Cass. civ., 2nd, 20 May 1985, no. 83-16.680).
Or else, "Whereas the adjudication decision, which does not rule on any incident, merely establishes a judicial contract and does not have the nature of a judgment; whereas it is therefore not subject to an application for review;". (Cass. civ., 2nd, 16 July 1987, no. 86-11.367).
In a recent decision, the Rouen Court of Appeal nevertheless accepted the principle of an application for review of an auction judgement that had not been contested at the auction hearing, but rejected it on the grounds that the conditions for such an application had not been met in this case (Rouen Court of Appeal, local court, 14 Oct. 2021, no. 20/02505p).
The court thus disassociated itself from the case law of the Cour de Cassation, according to which the auction judgement is not subject to appeal, unless it has been contested at the hearing.
Article R. 322-58 of the Code of Civil Enforcement Procedures states that "The costs of legal proceedings and, where applicable, any higher bids and transfer duties are paid by the successful bidder in addition to the price. Proof of this must be provided to the court clerk's office before the expiry of a period of two months from the date of the final award, failing which the bids may be repeated.
Any stipulation to the contrary is deemed unwritten.
Article R. 322-62 of the Code of Civil Enforcement Procedures adds that "The title de vente is issued by the registrar to the successful bidder. It is also delivered, at the request of the latter, to the pursuing creditor in order to proceed with the formalities for publicising the title, in the absence of diligence to this effect on the part of the successful bidder.
If the compulsory sale comprises several lots, a copy will be issued for each buyer.
The receipt for payment of the costs is attached to the bill of sale.
Lastly, article R. 322-63 of the Code of Civil Enforcement Procedures states that "The title deed is published in the real estate register in accordance with the rules for judicial sales, at the request of the purchaser or, in his absence, of the creditor pursuing the distribution.
The bill of sale will be issued by the auction registry upon production by the successful bidder's lawyer of the receipt for costs given to him by the pursuing creditor's lawyer.
Its publication is the responsibility of the lawyer of the successful bidder or, failing this, of the creditor pursuing the distribution.
Article 11 of the General Provisions of the Terms and Conditions of Sale states that "If the purchaser fails to pay the taxed price or costs within the prescribed time, the property is put back up for sale at the request of the pursuing creditor, a registered creditor or the distrainee, under the conditions of the first forced sale.
If the price of the new forced sale is lower than that of the first, the defaulting bidder will be obliged to pay the difference by all legal means, in accordance with the provisions of article L. 322-12 of the French Code of Civil Enforcement Procedures.
The defaulting bidder shall be liable for the costs charged at the first sale hearing. He will be liable for interest at the legal rate on his bid from two months after the first sale until the new sale. The interest rate will be increased by five points at the end of a period of four months from the date of the first final sale, in accordance with the provisions of article L. 313-3 of the French Monetary and Financial Code.
Under no circumstances will the defaulting bidder be entitled to a refund of any sums paid.
If the price of the second sale is higher than that of the first, the difference will belong to the creditors and the seizing party.
The purchaser must pay the costs of the new sale.
Article L. 322-12 of the Code of Civil Enforcement Procedures adds that "Failing payment of the price or a deposit and payment of costs, the sale is automatically cancelled.
The defaulting bidder is required to pay the difference between his bid and the resale price, if the latter is lower. He may not claim reimbursement of the sums he has paid.
Article R. 322-72 of the Code of Civil Enforcement Procedures states that "The successful bidder at the initial sale retains the costs charged at the time of the auction. After a period of two months following the auction, he is liable for interest at the legal rate on his bid until the new sale.
The person declared the successful bidder at the end of the new auction must pay the costs relating to the new auction.
In the absence of settlement or deposit of the price and payment of costs, the sale is automatically cancelled and the property is put back up for sale on reopening of the auction.
As a penalty, the defaulting bidder will be required to pay :
In addition, the defaulting bidder will not be entitled to the return of sums already paid, which will be included in the basis of assessment for the distribution of funds. For example, the bank cheque for 10 % will not be returned.
The action to supplement the price, to pay the difference between the sale price of the two auctions, will be brought by the party who has an interest in it, i.e. in practice :
The Court of Cassation confirmed that the enforcement judge had jurisdiction to declare the cancellation of a sale by auction resulting, pursuant to article L. 322-12 of the Code of Civil Enforcement Procedures, from the failure to pay or deposit the sale price (Civ. 2e23 February 2017, no. 16-13.178).
It should be noted that in addition to non-payment of the price and taxed costs, articles R. 322-66 and R. 322-67 of the Code of Civil Enforcement Procedures also mention non-payment of transfer duties as grounds for reopening the auction.
Article 11, paragraph 1, of the general provisions of the terms and conditions of sale specifies that "If the purchaser fails to pay the taxed price or costs within the prescribed time, the property is put back up for sale at the request of the pursuing creditor, a registered creditor or the distrainee, under the conditions of the first forced sale.
Article R. 322-66 of the Code of Civil Enforcement Procedures states that "If the successful bidder fails to pay the price, the taxed costs or the transfer duties within the prescribed time, the property is put back up for sale at the request of the pursuing creditor, a registered creditor or the distrainee, under the conditions of the first forced sale.
Lastly, article R. 322-67 of the Code of Civil Enforcement Procedures states that "Any person wishing to repeat the auction must obtain a certificate from the registry stating that the successful bidder has not provided proof of payment of the price or its deposit or payment of the taxed costs or transfer duties.
The person seeking to reopen the auction shall serve the certificate on the distrainee, the successful bidder and, where applicable, the creditor who requested the sale.
In addition to the information required for bailiff's documents, service on the purchaser shall include, under penalty of nullity :
1° A summons to pay the price, taxed costs and transfer duties within eight days;
2° A reminder of the provisions of the second paragraph of article L. 322-12 and articles R. 311-6, R. 322-56, R. 322-58, R. 322-68, R. 322-69 and R. 322-72.
If the first auction hearing is null and void, the parties are obliged to repeat the auction under the same conditions as the first forced sale.
The party wishing to continue with the reopening of the auction must obtain a certificate from the registry stating that the successful bidder has failed to provide proof of deposit of the price, taxed costs or transfer duties.
In practice, the winning bidder must provide the clerk's office with the receipt for payment of the taxed costs, but not the receipt for payment of the sale price, which the receiver should normally provide.
However, the registry will be aware of the non-payment of transfer duties, as it is responsible for registering the sale with the Treasury.
In order to demonstrate that the price has not been paid, the pursuing creditor's lawyer must therefore ask the escrow agent designated in the terms and conditions of sale for a certificate of non-consignment, which he will then send to the auction registry. The latter will then be able to draw up the certificate of non-consignation, which the successful bidder's lawyer must serve by bailiff's writ on the successful bidder and, if necessary, on the creditor who requested the sale.
The deed must include the information specified in article 648 of the Code of Civil Procedure, as well as a reproduction of the second paragraph of article L. 322-12 and articles R. 311-6, R. 322-56, R. 322-58, R. 322-68, R. 322-69 and R. 322-72.
Article R. 322-68 of the Code of Civil Enforcement Procedures states that the time limit for contesting the decision is 15 days, and above all specifies that the decision is not subject to appeal: "The successful bidder may contest the certificate within fifteen days of being served with it. The decision of the enforcement judge ruling on this challenge is not subject to appeal.
The Court of Cassation points out that this challenge must be made in the form of a lawyer's submission, in accordance with Article R. 311-6 of the Code of Civil Enforcement Procedures (Civ. 2eFebruary 21, 2013, no. 11-27.635).
It also points out that "it is only in the absence of a deposit or payment of the price and costs by the date on which the court gives its ruling that the sale can be declared to have been cancelled, either during the re-bidding procedure or by an action for cancellation alone". (Cass. 2e civ., 3 Feb. 2022, no. 20-19.522, published in the bulletin).
In the same decision, the court pointed out that the cancellation of the sale could only be ordered on the basis of the special provisions of the Code of Civil Enforcement Procedures, which derogate from those of ordinary law.
Article R. 322-69 of the Code of Civil Enforcement Procedures adds that "If the successful bidder fails to comply with the summons, the property will be put up for sale again at a new auction.
The new sale hearing is set by the enforcement judge, at the request of the party seeking to reopen the bidding, at a date between two and four months following the date on which the registry's certificate is served on the buyer.
If the certificate provided for in article R. 322-67 is contested, this period runs from the date of the rejection decision.
The distrainee debtor, the pursuing creditor, the registered creditors and the defaulting bidder are notified by the court registry of the date of the hearing by registered letter with acknowledgement of receipt.
The Court of Cassation recalls that the defaulting purchaser remains the owner of the auctioned property as long as the resolution of the sale has not been established, and consequently must be called to the auction hearing on reiteration of the bids, to which he is a party (Cass. 2e civ., 9 June 2022, no. 20-21.352, published in the Bulletin).
If the defaulting buyer fails to comply with the summons to pay the price, the taxed costs and the transfer duties within 8 days of the date of service of the certificate by the registry on the buyer, the party seeking to reopen the bidding shall file a request to have the enforcement judge notify the buyer of a new auction date between +2 and +4 months from the date of service of the certificate by the registry on the buyer.
If the unsuccessful bidder contests the registry's certificate, this period of between +2 and +4 months is counted from the date of the enforcement judge's ruling on the dispute.
The distrainee debtor, the pursuing creditor, the registered creditors and the defaulting successful bidder are notified of the date of the hearing by the clerk's office by registered letter with acknowledgement of receipt. If it has not been possible to deliver the letter of notification to its addressee, the clerk's office invites the parties to proceed by way of service, in accordance with article R. 121-15 of the Code of Civil Enforcement Procedures.
The advertising formalities are identical to those carried out for the auction: "Advertising formalities are repeated in the forms and under the conditions set out in articles R. 322-31 to R. 322-36.
They shall also include the amount of the tender". (article R. 322-70 of the French Code of Civil Enforcement Procedures).
The only difference is that the posters will have to state the amount of the previous auction.
The auction hearing also takes place in the same way as a sale by auction: "On the day of the hearing, bids are repeated under the conditions set out in articles R. 322-39 to R. 322-49. (article R. 322-71 of the Code of Civil Enforcement Procedures).
Article R. 322-72 of the Code of Civil Enforcement Procedures adds that "The successful bidder at the initial sale retains the costs charged at the time of the auction. After a period of two months following the auction, he is liable for interest at the legal rate on his bid until the new sale.
The person declared the successful bidder at the end of the new auction must pay the costs relating to the new auction.
The unsuccessful bidder will bear the taxed costs of the previous hearing, while the new bidder will bear the costs of the re-bidding.
A higher bid is possible, provided that the reiteration does not itself take place following a higher bid hearing, in accordance with the third paragraph of article R. 322-55 of the Code of Civil Enforcement Procedures: "No higher bid may be received on the second auction.
Lastly, in the event of a repeat bid, the pursuing lawyer receives the full proportional fee, in accordance with Article III of Article A. 444-191 of the French Commercial Code : "III. - In the event of a repeat bid, the pursuing lawyer shall receive the full fee provided for in I. "
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