Court of Cassation decisions on the legal nature of current account credit facilities and their enforceability.
Extract
[...] SCOPE: The outstanding debt of a current account secured by a credit opening constitutes well a loan claim. - This claim benefits from the guarantees attached to the loan, including in the event of collective procedure of the client. - In practice, this allows the bank to to assert privileges (pledge, mortgage, etc.) as all secured lender. FOR BANKS : increased legal security ? recognition of a a firm right of claim from the use of funds. FOR DEBTORS IN PROCEEDINGS : impossibility to contest the treatment of the opening of the credit used as a true loan secured by a guarantee. [...]
[...] - UCB appealed, contesting being debtor of sums belonging to SCI to the extent of this unused availability. APPEAL COURT DECISION: considers that the sum of francs was not part of the SCI's assets, but constituted only a possibility of use of the open credit. - The Court concludes that the UCB was not indebted to the SCI at this date. ? In consequence, the society Launet is condemned to return the sums received in the context of provisional execution. APPEAL: --SINGLE MEASURE TAKEN IN ITS FIRST INSTANCE: The Launet company supports: that the opening of credit makes the banker debtor of the sums he has promised to make available, that theexistence of an available balance of francs meant that the bank had to this amount to the SCI, and it doesn't matter that the funds are affected to a determined use (the financing of the works). [...]
[...] =It is even said that it will soon be accessible in physical commerce thanks to payment applications. - This allows the customer to benefit from a a delay of 1 to 2 months for example, but for the customer who chooses to pay in installments, he can pay his order in 3 to 4 times. =This solution produces a real enthusiasm both for the ENT and for the consumer. - However, from a legal point of view, the « buy now, pay later » raises many questions as this payment method is in reality a credit granted to the buyer. [...]
[...] It is promise of loan (contractual agreement but without immediate transfer of funds). ? The creditor's claim does not arise as it is used of credit. - In terms of data entry, it devotes the protection of the unused part : ? The available fraction of credit does not enter into the client's estate, and remains untraceable by its creditors. - This protects the banks against arbitrary seizures on credit lines not yet drawn. - The unused portion of a current account credit opening, not being merely a loan promise, does not constitute a client's claim and cannot be seized by its creditors. DOMINIQUE LEGEAIS: By its ruling of principle as of January (RTD com obs. [...]
[...] diversion of their purpose to justify economic policies. Finally, the crisis of debt reduction (88% of files involving renewable credits) proves that the mismanaged credit can become a factor of exclusion, non integration. - The author defends a conception balanced and realistic : the fundamental rights must inspire banking law, not the substitute to him. The right to credit relates more to the public economic policy that of a fundamental subjective right opposable to the bank. In short, banking freedom remains, but it is exercised "to the test of fundamental rights - not to deny it, but to civilize it. [...]
