Legal support in enforcement proceedings, objecting to payment orders, seizure procedures, negative declaratory and restitution actions, and bankruptcy and composition (concordat) processes.
The collection of receivables arising from debt relationships, debtor default, enforcement proceedings, seizure procedures, payment orders, objections, negative declaratory and restitution actions, and bankruptcy processes are important areas of law that require technical expertise and a firm command of procedural rules.
Enforcement and Bankruptcy Law is the branch of law that governs the conclusion of the legal relationship between creditor and debtor through compulsory enforcement, and, under certain conditions, the liquidation of the debtor's assets.
Our firm provides legal consultancy and attorney services in the field of enforcement and bankruptcy law, particularly with respect to enforcement proceedings without a judgment and based on a judgment, proceedings specific to negotiable instruments, seizure procedures, precautionary attachment, payment orders, objections to enforcement proceedings, actions to cancel an objection, negative declaratory and restitution actions, the rights of debtors and third parties, seizure of movable and immovable property, wage garnishment, seizure of bank accounts, seizure of vehicles, mortgage and pledge enforcement, and bankruptcy and composition (concordat) processes.
Because the time limits in enforcement proceedings are short and the actions to be taken are subject to procedures set out by law, it is important that the legal situation be assessed without delay once the payment order or the enforcement office's action has been served.
Enforcement and Bankruptcy Law is the branch of law that governs the collection, through the state's compulsory enforcement mechanisms, of a receivable owed to a person or company where the debtor does not pay voluntarily, and, in the situations set out by law, the liquidation of the debtor's assets. While one of the primary aims of enforcement law is to enable the creditor to reach the amount owed, protecting the statutory rights of the debtor and third parties is equally important. For this reason, legal review is required in enforcement proceedings both to allow the creditor to collect the receivable effectively and to protect the debtor against unlawful proceedings and seizures.
Enforcement proceedings that a creditor can initiate without holding a court judgment are referred to as enforcement proceedings without a judgment. When initiating proceedings for monetary or security receivables, matters such as the source of the receivable, the debtor's details, the amount owed, interest, maturity, the type of proceedings and the competent enforcement office must be correctly determined. How the proceedings will continue if the debtor objects to the payment order must also be assessed separately.
Enforcement proceedings based on a judgment may be pursued in order to collect receivables that have been established by a court decision or by a document recognized by law as having the effect of a judgment. In enforcement proceedings based on a judgment, matters examined include the content of the court decision, whether the judgment has become final, whether it is capable of being enforced, interest and ancillary claims, the payment order, the enforcement order and seizure procedures. Whether a finality requirement applies must also be assessed according to the nature of the decision.
Special enforcement procedures may apply to receivables based on negotiable instruments such as cheques, promissory notes and bills of exchange. In proceedings specific to negotiable instruments, matters such as the formal requirements of the instrument, maturity, endorsement, signature, the authorized holder, payment, protest, the statute of limitations and the time limit for the proceedings are important. The legal remedies available to the debtor and the time limits for objection in this type of proceedings may differ from ordinary seizure proceedings.
The debtor may object to the payment order served on them within the conditions and time limits set out by law; the objection may relate to the whole or part of the debt, to interest, to the interest rate, to jurisdiction, or to the signature. The nature of the objection is important in determining whether the enforcement proceedings will continue and which legal remedies are available to the creditor. Where proceedings are suspended because the debtor has objected, the creditor may, under certain conditions, bring an action to cancel the objection; in this action, the existence of the receivable, the legal nature of the debt relationship, whether the objection is well-founded, the maturity of the receivable and the evidence are assessed, and where the conditions are met, a claim for enforcement denial compensation may also arise. In certain enforcement proceedings, it may instead be possible to apply to the enforcement court for removal of the debtor's objection; whether this route is available depends on the nature of the basis for the proceedings and whether the documents required by law are present.
Where a person is faced with a claim that they owe a debt they do not in fact owe, a negative declaratory action may be brought; the primary aim of this action is to establish that no debt relationship exists. Legal assessment may be carried out in particular where the debt never arose, where it has already been paid, where there is a dispute over the signature, where the debt has been extinguished, or where the enforcement proceedings are unlawful. A person who, despite not being a debtor, has been forced to make a payment as a result of enforcement proceedings may also bring a restitution action, under certain conditions, to recover the amount paid; in such a claim, the legal basis of the proceedings, the payment, whether a debt existed, and the circumstances under which the payment was made are assessed together.
A precautionary attachment may be requested, where certain conditions are met, in order to secure the collection of a receivable. Precautionary attachment can be particularly important in situations where there is a risk that the debtor will dispose of their assets or make collection of the receivable more difficult. In precautionary attachment matters, the nature of the receivable, its maturity, security, the debtor's assets and the enforcement/litigation process are assessed separately.
Once the enforcement proceedings become final, or once the conditions set out by law are met, seizure of the debtor's assets may follow. Seizure may be carried out against bank accounts, movable property, vehicles, immovable property, wages and salaries, and receivables held by third parties. Which assets may be seized and the scope of the seizure must be assessed within the framework of the applicable statutory provisions.
Electronic seizure procedures may be applied to money and receivables held in the debtor's bank accounts; matters that may be examined include the basis of the seizure, the nature of the funds in the account, whether they may be seized, and the rights of third parties. The debtor's wages and salary may be seized within the limits set out by law; in wage garnishment, matters such as the debtor's employer, the seizure order, the deduction rate, the existence of multiple seizures and their order of priority are important. Vehicles registered in the debtor's name may also be seized and, under certain conditions, sold; in vehicle seizure proceedings, existing seizures on the vehicle, pledges, impoundment, valuation and the sale process may be examined.
Seizure and sale procedures may be carried out with respect to immovable property registered in the debtor's name; the land registry record, mortgages, seizures, annotations, value and sale conditions of the property may be examined to assess the lawfulness of the enforcement process. The law contains special provisions regarding the seizure of the residence in which the debtor or their family lives; in a specific case, the nature of the property, the debtor's economic and social circumstances and the statutory conditions may be assessed to determine whether a homestead exemption claim can be raised. The law also provides that certain property and rights of the debtor may not be seized under certain conditions; personal effects, certain tools and equipment required for professional activity, and certain income and rights may fall within this scope.
The debtor or third parties may, under certain conditions, apply against seizures they consider unlawful; in seeking removal of the seizure, matters such as the basis of the seizure, the amount of the debt, the nature of the seized property, whether it is exempt from seizure, whether the debt has been paid, and irregularities in the seizure procedure may be examined. Where property that does not belong to the debtor is seized during enforcement proceedings, the ownership or other rights in rem of the third party may come into play; in such cases, legal remedies such as a third-party claim and a third-party claim action may be available. Protecting the rights of third parties is particularly important where property belonging to someone other than the debtor is seized at business premises operated by companies.
Seized property may be offered for sale in accordance with the procedures set out by law; matters that are important in the sale process include the sale announcement, the estimated value, electronic sale, bids, the conditions of the auction and its outcome. Where sales carried out through enforcement proceedings are found to be contrary to law, an action to set aside the auction may be requested under certain conditions; in this respect, the sale procedure, the announcement, service of notice, the conditions of the auction, the sale price and the auction process may be examined. Care must be taken with regard to the time limits and application requirements in this area.
For companies, the timely collection of commercial receivables is of great importance for the business's cash flow. Our firm can provide legal support in determining the appropriate enforcement method with respect to invoice receivables, current account receivables, commercial contracts, cheques and promissory notes, the price of goods and services, and receivables arising from unjust termination. In collecting receivables based on negotiable instruments such as cheques and promissory notes, the appropriate method of proceedings may be determined by assessing factors such as the date the instrument was drawn, its maturity, amount, signature, endorsement and the authorized holder. Whether a receivable is time-barred is assessed according to its source and the relevant special legislation; different time limits may apply depending on whether the receivable arises from a cheque, a promissory note, a contract, a rent receivable, a commercial receivable or a court judgment.
Bankruptcy is a collective form of compulsory enforcement that may be applied, where the conditions set out by law are met, to commercial companies and, in certain circumstances, to individuals subject to bankruptcy, with a view to liquidating the debtor's assets through statutory procedures. In bankruptcy proceedings, it is not only the position of a single creditor that is assessed, but the debtor's entire assets and the legal position of all creditors together. Bankruptcy is a significant legal mechanism, particularly for debtors engaged in commercial activity; in bankruptcy proceedings, matters assessed include the nature of the receivable, whether the debtor is subject to bankruptcy, the basis of the proceedings, the payment order, whether the debt has been paid, and the bankruptcy petition. Where the conditions set out by law are met, it may in certain cases also be possible to file directly for bankruptcy; whether the grounds for direct bankruptcy exist must be assessed according to the debtor's legal status and the particular circumstances of the case. Various legal mechanisms also exist within bankruptcy proceedings for improving the debtor's financial position; for businesses experiencing payment difficulties in particular, assessing composition (concordat), restructuring and other legal solutions is important.
Composition (concordat) is a legal mechanism that allows a debtor who is unable to pay its debts as they fall due, or who is at risk of being unable to do so, to pay its debts under a specific plan or to restructure its financial position, within the conditions set out by law. The composition process involves numerous legal stages, including the temporary moratorium, the definitive moratorium, the composition commissioner, the position of creditors, notification of receivables, the composition project and court review. For companies experiencing financial difficulty, it is important to assess a composition application in a timely manner; during the application process, the feasibility of the composition project is assessed by examining the company's financial statements, debt structure, receivables, cash flow, assets and payment plan. Composition produces important consequences not only for the debtor but also for creditors; creditors may need to notify their receivables, evaluate the composition project, attend the creditors' meeting, vote, and follow the commissioner and court proceedings. The status of existing enforcement proceedings during the composition moratorium, and whether new proceedings may be initiated, must be assessed within the framework of the applicable statutory provisions; for this reason, it is important for persons who have a receivable from a company that has filed for composition to separately assess their enforcement and collection strategy.
The purpose of enforcement law is not solely to enable the creditor to collect the amount owed. The debtor also has various rights arising from law: the debtor may object to unlawful proceedings, assert that no debt exists, object with respect to property exempt from seizure, pursue legal remedies against improperly served notices, request the removal of an unlawful seizure, and assess solutions for paying or restructuring the debt. In enforcement and bankruptcy disputes, documents such as contracts, invoices, current account records, cheques and promissory notes, bank statements, payment records, formal notices, email correspondence, commercial books and records, court decisions and enforcement files may be important. Assessing the documents underlying the receivable before initiating proceedings is important for determining the correct method of enforcement.
The appropriate method of proceedings is determined according to the nature of the receivable, and proceedings may be initiated at the competent enforcement office. Depending on the type of proceedings, a payment order or an enforcement order is sent to the debtor.
First, it must be determined when the payment order was served and what type of proceedings are involved. Because the time limits for objections or other legal applications may vary depending on the type of proceedings, it is important that the file be reviewed without delay.
No. An objection may have consequences for the continuation of the proceedings, but it does not automatically extinguish the underlying debt. The creditor may be able to pursue legal remedies such as an action to cancel the objection or an application for removal of the objection.
Wage and salary seizure may be applied within the conditions and limits set out by law.
Under enforcement proceedings that have become final, or that meet the conditions set out by law, seizable assets in the debtor's bank accounts may be seized.
The law contains special provisions regarding the seizure of a debtor's residence. Whether seizure applies must be separately assessed according to the nature of the property and the circumstances of the specific case.
Depending on the type and stage of the proceedings, an objection, a negative declaratory action or other legal remedies may be available. To avoid missing any time limits, it is important that the legal situation be reviewed from the moment the payment order is served.
The duration of an enforcement file varies depending on whether the debt is paid, the debtor's assets, any objections, seizure and sale procedures, and the particular features of the file.
Whether the company is subject to bankruptcy and whether the conditions for bankruptcy are met must be assessed based on the specific case.
Representation by a lawyer is not mandatory for every enforcement action. However, particularly in high-value receivables, commercial disputes, proceedings based on negotiable instruments, seizure and sale procedures, and negative declaratory and restitution actions, obtaining legal support is important to prevent the loss of rights.
If you are unable to collect a receivable, if enforcement proceedings have been initiated against you, if your bank account or wages have been seized, if your immovable property or vehicle has been seized, if you are faced with unlawful enforcement proceedings, or if your company is experiencing financial difficulty, it is important that the legal situation be assessed without delay. Our firm provides legal consultancy and attorney services in the areas of enforcement proceedings, collection of commercial receivables, enforcement without and based on a judgment, proceedings specific to negotiable instruments, seizure, precautionary attachment, objections to enforcement, actions to cancel the objection, removal of the objection, negative declaratory actions, restitution actions, third-party claims, enforcement sales, actions to set aside the auction, and bankruptcy and composition (concordat) proceedings.