Verification and eligibility of debts: Right for the creditor to appeal when the bankruptcy judge has not ratified the proposal of the judicial representative

Collective Proceedings

Source: Supreme Court, Commercial Chamber, June 16th 2015, n° 14-11.190

In accordance with the provisions of article L.624-3 paragraph 2 of the Commercial Code, the creditor whom debt is wholly or partly disputed and who has not answered the judicial representative within the delay mentioned in article L. 622-27 cannot make any appeal against the decision of the bankruptcy judge when it confirms the proposition of the creditors' representative.

A collective proceeding has been opened in respect of the society Seafrance. The society BP Marine Limited has declared a debt on June 18th 2010, but has not answered to the letter from the judicial representative dated October 20th 2010, informing him that part of his debt was contested.

Then the society appealed against the order of the bankruptcy judge who decided on the eligibility of his debt.

The court declared the appeal inadmissible, but noted that the bankruptcy judge had rejected the whole debt meanwhile the judicial representative had suggested only a partial rejection in his letter dated October 20th 2010.

The court considers, in accordance with the article L. 624-3, paragraph 2 of the Commercial Code, that the schedule provided by the law has as an objective to allow the progress of the collective proceeding in a reasonable period of time for all parties and that the rights of a creditor are not violated as long as the contestation proceeding is provided by the law and allows the access to a judge. It considers that the creditor perfectly knew it, when he did not respect the deadline to act in response of the whole or partial rejection of his debt.

The Supreme Court considers that the Court of Appeal has not drawn the legal consequences of its observations and has violated the sub mentioned article, by outlining, in its first paragraph, that according to the terms of this text, the creditor whom debt was wholly or partly disputed and who did not answer the judicial representative within the delay mentioned in the article L. 622-27 cannot appeal against the decision taken by the bankruptcy judge when it confirmed the proposal of the judicial representative of the creditors. On the other hand, the creditor has the right to make an appeal when the bankruptcy judge has not ratified the proposal of the judicial representative.