"`html
La foreclosure often places creditors in a competitive situation. How do you divide up the spoils when several creditors are after the same debtor's assets? This question, far from being theoretical, arises daily in the French courts. In the past, the adage "seizure upon seizure is worthless" meant that the second creditor had to wait for the first seizure to be completed. Fortunately, modern law has evolved.
1. Concurrence of creditors: a practical reality
When a debtor accumulates debts, several creditors may want to seize his movable property. The legislator has dealt with this situation by allowing late creditors to join a seizure and sale already initiated by a first creditor.
This joinder is not a contentious incident but a participatory procedure that avoids the multiplication of costs. Article L. 221-1, paragraph 2 of the Code of Civil Enforcement Procedures states that "any creditor in possession of a writ of execution recording a liquid and due debt may [...] join in the seizure operations by way of opposition"..
This opposition-joinder, as it is known in practice, allows the second creditor to save himself a separate seizure while participating in the distribution of the sale price.
2. Conditions for opposition-joinder
Conditions of access to the procedure
To join a seizure and sale that has already begun, the opposing creditor must satisfy the same conditions as the creditor making the first seizure:
- Hold an enforceable title
- Proof of a claim that is due and payable
- Have served a prior order to pay
Article R. 221-41 of the Code of Civil Enforcement Procedures stipulates that "any creditor meeting the conditions set out in Article L. 221-1 may join the seizure operations".. The same article specifies that objections are no longer admissible once the seized assets have been verified, at which point the sale process begins.
The opposing creditor must therefore act quickly. In a ruling dated 20 November 2003 (no. 01-15.192), the Court of Cassation confirmed that a joinder order may be lodged after a seizure by immobilisation of a vehicle.
Small claims
A paradox exists for claims of less than €535. Article L. 221-2 of the Code des procédures civiles d'exécution (French Code of Civil Enforcement Procedures) normally imposes a system of subsidiarity: seizure for sale is impossible without judicial authorisation when other means of enforcement (such as the seizure of bank accounts) are possible.
Curiously, this restriction does not seem to apply to opposition-joinder. The creditor of a small sum can thus join a seizure for sale that has already begun even if he could not have initiated it himself. This disparity in treatment deserves to be highlighted. It should also be noted that these individual procedures can be profoundly affected by the opening of insolvency or over-indebtedness proceedingswhich generally suspend or prohibit individual prosecutions.
3. Opposition-joinder procedures
Multiple foreclosures
When a bailiff finds that a seizure for sale has already been carried out on the goods he intended to seize, he must convert his act into an opposition-junction. There are two possible situations:
- If the bailiff is aware of the existence of the first seizure before moving to the area, he will draw up a notice of opposition directly at his office, without making an inventory of the property.
- If the bailiff discovers the first seizure during his operations (the debtor presents him with the first report), he converts his act of seizure into an opposition-junction.
The notice of opposition must state the enforceable title on which the opposition is based and the precise breakdown of the sums claimed. It is then served on the debtor and the first distraining creditor.
If the debtor, whether present or absent, does not reveal the existence of a first seizure, two seizures for sale may coexist. In this case, case law tends to reclassify the second seizure as an opposition-junction (TGI Brest, JEX, 7 April 1999). These complex situations may also give rise to incidents relating to the ownership of seized propertyThis has a direct impact on the procedure and the final distribution of funds.
Competition with a protective seizure
The situation is different when a creditor with a writ of execution wishes to carry out a seizure for sale on assets that have already been seized as a precautionary measure. In this case, article R. 522-12 of the Code of Civil Enforcement Procedures stipulates that the bailiff must serve the seizure-sale report on the creditors who have previously carried out precautionary seizures.
A protective attachment does not therefore preclude an attachment for sale. The creditor who carries out the latter continues the procedure until the sale. Protective creditors must obtain a writ of execution before the funds are distributed if they wish to participate in the distribution.
4. The effects of opposition-joinder
Sales Operations Management
Under article R. 221-42 of the Code of Civil Enforcement Procedures, the creditor who is first to seize remains in control of the proceedings. It is the creditor who directs the operations until the seized assets are sold. Opposing creditors simply wait for the proceeds of the sale to be distributed.
This primacy of the first seizing creditor is designed to ensure efficiency. A single creditor conducts the procedure, which avoids the multiplication of acts and the risks of contradiction.
Breakdown of proceeds
After the sale, the agent in charge of the sale draws up a proposal for the distribution of the price among the various creditors. Article R. 251-2 of the Code des procédures civiles d'exécution gives the agent a period of one month from the date of the sale or deposit of the price.
This draft is notified to the creditors and the debtor, who have 15 days to contest it. If there are no objections, payment is made within 8 days. A single dispute is enough to block the amicable distribution and force recourse to the enforcement judge.
Subrogation in legal proceedings
Article R. 221-46 of the Code provides that if the first distraining creditor fails to act, any opposing creditor may send him a summons to proceed with the sale within 8 days.
If the first distrainor remains inactive despite this formal notice, the opposing creditor is "automatically subrogated" to the rights of the first distrainor. The opposing creditor may then proceed with the sale himself after obtaining the necessary documents.
This subrogation ensures that the negligence of the first distrainor does not block the proceedings indefinitely, thereby protecting the interests of all creditors.
5. Addition to the first entry
Legal framework for additional seizures
Opposition may be accompanied by a supplementary seizure. Article R. 221-43 of the Code authorises the opposing creditor to extend the initial seizure to other assets by having a supplementary inventory drawn up.
This extension is also available to the first seizing creditor, who may broaden the scope of his initial seizure. The complementary seizure follows the ordinary rules for seizure for sale in the hands of the debtor (articles R. 221-16 to R. 221-19).
The supplementary inventory must be served on the debtor and, if it is drawn up by the opposing creditor, on the first distraining creditor.
Effects of the complementary seizure
The supplementary seizure opens a new one-month period for the amicable sale of the newly seized assets. Article R. 221-45 of the Code stipulates that a compulsory sale can only be carried out once all the time limits have expired.
This time lag can slow down the procedure. This is why the text provides for the possibility of dissociating the sales:
- With the agreement of the debtor
- With the authorisation of the enforcement judge
- If the formalities for advertising the sale of the first property have already been completed
Article R. 221-48 adds that the nullity of the first seizure does not invalidate the oppositions or the supplementary seizure, unless the nullity results from an irregularity in the seizure operations.
This autonomy of the complementary seizure protects opposing creditors against any defects in the initial seizure.
Managing joint creditors in the context of seizure for sale is a complex matter that requires in-depth knowledge of the applicable rules and a certain reactivity. Opposition-junction, complementary seizure, distribution of funds and subrogation are all mechanisms designed to balance the rights of the parties and ensure the effectiveness of the procedure. Faced with these challenges, the support of an expert enforcement lawyer is essential to help you secure your business, whether it's defending your interests as a creditor or advising you as a debtor.
Sources
- Code of Civil Enforcement Procedures, articles L. 221-1, L. 221-2, R. 221-41 to R. 221-48
- Court of Cassation, 2nd Civil Division, 20 November 2003, No. 01-15.192
- TGI Brest, JEX, 7 April 1999, JurisData n° 1999-108509
- Natalie Casal, "Saisie-vente. - Incidents", JurisClasseur Procédure civile, Fasc. 1600-80, 16 July 2021.
- Natalie Fricero, "Saisie-vente", Répertoire de procédure civile, Dalloz, December 2011
" `
EN 
FR