The Court of Cassation clarifies that a judge cannot extend a guarantor's commitment beyond the explicitly agreed limits, as per Article 2292 of the Civil Code.
Extract
[...] This judgment illustrates the principle of strict interpretation of the suretyship. In fact, the suretyship appears as a contract by nature, and therefore does not imply. Furthermore, it is understood that the commitment of the physical guarantor cannot be extended to non-express debts, even if they arise from commercial relations between the professional creditor and the main debtor. In the end, the decision reinforces the protection of the guarantor by imposing a strict concordance between the object of the suretyship and the guaranteed debt, and invites creditors to draft with rigor the engagement clauses. [...]
[...] She therefore reproached the judges of the first instance for having extended her commitment to a distinct debt, in violation of Article 2292 of the Civil Code, which states that suretyship does not presume and cannot be extended beyond the limits within which it was contracted. The Court of Cassation was thus required to answer the question of whether the judge could extend the guarantor's commitment to a debtor balance of a current account when the suretyship explicitly covered a specific loan. The High Jurisdiction partially quashed the appeal judgment for lack of legal basis. [...]
[...] In this case, a legal entity had given, on 1 December 2003, a bank loan of 150,000 euros to another person. To guarantee the repayment of this loan, a natural person had stood as guarantor of the loan, up to 150,000 euros. Following the denunciation of the loan by the bank, the main debtor and the guarantor brought an action against the bank to discharge their commitments. Subsequently, the company having been placed in judicial liquidation, the professional creditor brought an action against the guarantor to enforce their commitment. [...]
