Limitation period for action against voluntary liquidator: when does the time run?

Imagine: you own a commercial property in Thiers. You let it to a company which, overnight, ceases its activity and appoints a voluntary liquidator. You wait for your last rent, but nothing. You learn that the company has been dissolved, that the liquidator distributed the assets without paying you. Furious, you want to sue the liquidator personally. But here's the question: what is the time limit to bring an action? And above all, when does this time start to run? This question, which may seem technical, is crucial for any creditor.

The French Supreme Court, in a judgment of 25 June 2013, gave a clear answer: the limitation period for an action in damages against a voluntary liquidator runs only from the day when the creditor's rights were recognised by a court decision which has become res judicata. In other words, as long as you have not obtained a final judgment establishing your debt, the limitation period does not start.

This decision, handed down in a case from Rennes but which directly concerns litigants in Clermont-Ferrand and elsewhere, reminds us of the importance of understanding the mechanisms of limitation. In this article, I explain everything, step by step, with concrete examples.

The facts: a story that happens every day

Mr X, a shopkeeper in Thiers, had granted a commercial lease to the company "Le Relais de Chasse de Klesseven". One day, this company is placed in voluntary liquidation. The appointed liquidator proceeds with the sale of the assets and distributes the proceeds to the shareholders, but forgets to pay Mr X, who remains a creditor for several months of unpaid rent, approximately €15,000.

Mr X then brings court proceedings to obtain payment of his rents. He succeeds before the tribunal, and then the Rennes Court of Appeal confirms his debt by a judgment of 13 December 2011, rectified on 3 April 2012. Armed with this decision, he sues the voluntary liquidator for personal liability, arguing that the latter committed a fault by not paying him.

The liquidator retorts that the action is time-barred: according to him, the three-year limitation period (at the time) started to run from the closure of the liquidation, i.e. several years before the claim. The Court of Appeal agrees with the liquidator, dismissing Mr X's claim. But the latter appeals to the Supreme Court.

The reasoning of the court — dissected

The French Supreme Court quashes the appeal judgment and remands the case to the same Rennes Court of Appeal, differently composed. Its reasoning is clear: the starting point of the limitation period for an action in damages against a voluntary liquidator is the day on which the claimant's debt was recognised by a court decision which has become res judicata (Article 500 of the Code of Civil Procedure).

Why? Because as long as the creditor has not obtained an enforceable title establishing his debt, he cannot prove that the liquidator caused him harm. Indeed, the liability of the liquidator requires a fault, damage and a causal link. However, the damage is only certain when the debt is judicially established.

The lower courts had made a mistake by making the time start from the closure of the liquidation. The Supreme Court reminds that the action in damages is distinct from the action for payment of the debt: it is a claim for compensation, which follows its own limitation rules. Thus, in this case, the time started to run on 3 April 2012 (date of the rectifying judgment), and the claim served a few months later was perfectly admissible.

This solution is protective for creditors. It prevents them from being forced to act before even knowing the exact extent of their damage, on pain of being met with a strike-out.

What this means for you — concretely

For a landlord in Clermont-Ferrand, this decision means that you can wait until you have obtained a final judgment condemning your tenant to pay the unpaid rents before suing the voluntary liquidator. For example, if your tenant company owes you €20,000 and the liquidator distributed the assets without paying you, you have three years from the irrevocable judgment to act against the liquidator.

For a tenant or co-owner, the principle is the same: if you are a creditor of a company in voluntary liquidation (for example, for unpaid renovation work), your action against the liquidator only becomes time-barred from the judicial recognition of your debt.

However, be careful: the limitation period for the action for payment of the debt itself (against the company) follows its own rules. Do not delay in acting to obtain an enforceable title. Once this title is obtained, you have a new time limit to pursue the liquidator.

Four tips to avoid this type of dispute

• Monitor the voluntary liquidation of your tenant: as soon as you learn that a tenant company is in liquidation, ask the liquidator for payment of your debts by registered letter with acknowledgement of receipt. Keep a copy.
• Obtain an enforceable title quickly: if the liquidator refuses to pay, sue the company in court to have your debt recognised. Do not wait for the closure of the liquidation.
• Keep all supporting documents: leases, receipts, formal notices, correspondence with the liquidator. They will serve to prove your debt and the liquidator's fault.
• Consult a lawyer as soon as the first arrears appear: a lawyer specialised in property law in Thiers or Clermont-Ferrand will be able to advise you on the strategy to adopt and the deadlines to respect.

Further reading: related case law and developments

This decision is part of consistent case law of the Commercial Chamber. For example, in a judgment of 10 May 2012 (n° 11-16.975), the French Supreme Court had already held that the limitation period for an action in damages against a judicial liquidator runs from the date of certain knowledge of the damage. The 2013 decision transposes this solution to the voluntary liquidator, confirming uniformity of treatment.

Since the reform of limitation by the Law of 17 June 2008, the ordinary limitation period is five years (Article 2224 of the Civil Code). Thus, for facts after 19 June 2008, the time limit to act against the voluntary liquidator is five years from the irrevocable decision recognising the debt.

The courts are vigilant: they systematically check the date of the decision which has become res judicata. A creditor who has waited too long after this decision would be inadmissible. The trend is therefore towards protection of the creditor, but provided he acts within the time limits once his title is obtained.

Key points to remember

1. When does the time run? From the final court decision recognising your debt.
2. What is the time limit? 5 years (since 2008) for the action in damages against the liquidator.
3. Can I act before having a judgment? Yes, but you risk being met with the absence of certain damage.
4. What if the liquidator has already distributed the assets? You can still sue him personally, because his fault is established.
5. Must I sue the company first? Yes, to obtain a title. Then act against the liquidator within 5 years.

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