Court ruling on the transfer of guarantee and pledge in the event of a merger-absorption of a creditor company.
Extract
[...] Overall tone: positive, firm validation of the line adopted by the Court. Class Notes Contrary to doc n°2 A bank had stood as guarantor and this commitment was secured by another guarantee pledge). The company whose commitment was secured was placed in judicial liquidation. Qst: Does the expressed will of the guarantor to maintain its commitment towards the acquiring company for the guarantee of debts arising after the merger imply the transfer of the pledge that was associated with the previously granted guarantee in favor of the absorbed company? [...]
[...] The bank appealed to the cassation court against this decision. Question of law : The suretyship commitment and the guarantees attached to it continue to exist automatically in favor of the acquiring company in the event of a merger-absorption of the creditor company, for the debts born subsequently at this merger ? Solution of the Court : The Court of Cassation dismissed the bank's appeal. It ruled that the merger-acquisition of the creditor company, resulting in its disappearance, limits the commitment of the guarantor to the sums owed by the debtor company on the date of this merger. [...]
[...] The liquidator of the debtor company contested this operation, arguing that the mortgage did not guarantee the debts owed to the acquiring company arising after the merger. Procedure : The liquidator brought the bank to account for the amounts withdrawn from the mortgaged account, deducting the amounts owed to the creditor company on the date of the merger-absorption. The appeals court ruled in favor of the liquidator, finding that the mortgage did not cover the debts arising after the merger in the absence of an agreement from the debtor company or its liquidator. [...]
[...] - Dorothée Gallois-Cochet ? Main criticism: no questioning, tone of approval The author welcomes the judicial continuity : she emphasizes that the ruling fits into the line of solutions already ' well established » by the Court of Cassation, and repeatedly recalled since the 2005 controversy. ? Formule forte to remember : « The merger-absorption of the creditor brings an end to the obligation of coverage of the guarantor, unless a contrary will is manifested. » ? Appraisal of the clarity of the solution : She does not criticize the rigor of the interpretation, and seems to the contrary to approve it as a timely reminder of legal security for the guarantors. [...]
[...] Formulas that shock and striking expressions : - He qualifies the story as 'tragedy for the guarantor', adding that 'the story ends badly for the guarantor'. - The critic notes that the Court seems to rely on the nature intuitu personae of the beneficiary, « without telling him », this which would be « contestable ». - He noted that the surety's willingness to continue his commitment was evident, particularly through the continuous payment of the surety commission, but was not recognized as an 'express manifestation'. [...]
