2 June 2015

Recognition and enforcement of debt collection judgments in France

Debt collection can be implemented in France by the recognition and enforcement of a foreign judgment or by obtaining a French Court order.

Indeed, in the absence of a foreign judgment or if the foreign judgment cannot be recognized in France, it will be necessary to obtain a French judgment to recover the claim.

Without a foreign judgment, the first step is to send a letter of formal notice with acknowledgment of receipt to the debtor. Beyond the fact that this step may save the business relationships between the parties, it also allows the creditor to prove that it tried all amicable solutions before going to court, and in case of unsuccessful application, to apply default interests.

To recover the debt, the creditor may apply for an order for payment, a summary order or a judgment on the merits.

  • Order for payment :

Depending on the parties involved, the recovery of an unpaid debt can be pursued by obtaining an order for payment from the Juge de proximité, Tribunal d’Instance, Tribunal de Grande Instance and Tribunal de Commerce.

Under article 1405 of the French Code of civil procedure, a debt may be collected by an order for payment if:

1° the debt has a contractual origin or has resulted from an obligation of a statutory nature and is of defined amount; in contractual matters, the amount is defined by clauses of the contract including, if necessary, a penalty clause;

2° the undertaking results from the acceptance or drawing up of a bill of exchange, of the subscription to a promissory note, of the endorsement or backing of one of these instruments or the acceptance of the assignment of receivables in accordance with the Act n°81-1 of January 2nd, 1981 relating to access to corporate credit.

This procedure is implemented without the presence, or knowledge, of the debtor.

Once the order for payment is served personally, the debtor has a one month period to file an opposition. Article 1408 of the French Code of civil procedure provides that in that case, the creditor can ask the Court to immediately transfer the case to the court it considers to have jurisdiction.

The order for payment method is a fast and easy way to recover an unpaid debt. The only real risk comes from the fact that the debtor can file an opposition which will lengthen the time necessary to collect the debt.

  • Summary order

The summary proceeding allows the creditor to quickly obtain a ruling. On average, the summary proceeding takes between two and three months.

Articles 809 (TGI), 849 (TI) and 873 (TC) of the French Code of civil procedure provide that “In the cases where the existence of an obligation is not seriously contestable, [the judge] may award an interim payment to the creditor (…)”.

The summary proceeding requires the existence of a debt which is not seriously contestable since the case is not discussed in great detail.

If the existence or amount of the debt is contested, the judge will dismiss the case and urge the parties to obtain a judgment on the merits.

  • Judgment on the merits

In some cases the recovery is challenged by the debtor. Whether the existence of the debt itself or the amount is challenged, a judgment on the merits will be necessary to recognize the creditor’s claim.

Referral to the competent Court may then be made for example on the basis of the binding force of contracts pursuant to article 1134 of the French civil Code. Furthermore, the creditor may request additional sums from the debtor. For instance, the creditor may request damages for wrongful resistance to the payment of a sum due or damages on the basis of contractual liability.

Once the creditor has a ruling, a French «Huissier» must be asked to serve the decision to the debtor and to secure payment of the debt. If necessary they are able to seize bank accounts and assets belonging to the debtor.

If the creditor has a foreign judgment regarding the debt

Since the foreign judgment orders a person residing on French territory to pay a sum of money, it will be necessary to resort to the recognition and enforcement proceeding (“Procédure d’exequatur”). Indeed, all foreign decisions concerning the property or assets of a person or company residing on French territory must be subject to an exequatur procedure.

In Europe, the recognition and enforcement of debt collection decisions is laid down in Regulation (eu) n°1215/2012 of the European Parliament and of the Council of December 12th, 2012. Article 36 provides that such decisions originating from a member State are recognized and enforceable as of right.

Furthermore, Regulation (eu) n°805-2004 of the European Parliament and of the Council of April 21st, 2004 creating a European Enforcement Order for uncontested claims facilitates the process of recovery.

As for the countries outside the European Union without an international treaty with France, such as the United-States, Canada, Japan or Australia and many others, the recognition and enforcement of debt collection judgments follows the rules laid down by the famous 2007 French Supreme Court case (Cour de cassation February 20th, 2007 n°05-14082). The French judge will verify:

  • the indirect jurisdiction of the foreign judge, based on the connection between the litigation and the judge,
  • the conformity to the procedural and substantial French international public policy,
  • the absence of fraudulent forum shopping (evasion of the law).

You can check if your country has ratified an international treay with France by visiting the Country section of this website, under the Recognition & enforcement menu.

The recognition and enforcement (exequatur) of the foreign judgment will allow the creditor to force the debtor to pay. The creditor will be able to garnish the debtor’s bank account(s) for example.

Terence RICHOUX is a French-American attorney with extensive experience in debt collection matters. He worked with attorneys specialized in this field and acquired the skills necessary to optimize his client’s success rates. With experience gained in the United-States and England, Terence RICHOUX has the qualifications to carry out the recovery of an international debt either by way of recognition and enforcement of foreign judgments or by obtaining a French Court order.