Suspension of Works: The Employer Cannot Terminate Without Prior Formal Notice

Picture the scene: you are the owner of a house in Montbrison, and you have entrusted renovation works to a contractor. During the works, an unforeseen event occurs — a neighbour dispute, a cash flow problem, or simply a doubt about the quality of the services. You order the contractor to stop everything. But then, you decide that this setback justifies terminating the contract, and you take legal action to have the termination declared at the contractor's fault. Serious mistake, as this little-known decision of the Court of Cassation will demonstrate.

The question every employer (owner who arranges for works to be carried out) asks: can I terminate a works contract without having served formal notice on the contractor? The answer is no, even if I have given an order to suspend the works. This is what the Court of Cassation ruled in a decision of 17 March 1971, the principles of which remain highly relevant today.

This decision, handed down within the jurisdiction of Saint-Étienne, pits an owner named Paupine against a contractor. It recalls a fundamental rule: to terminate a contract at the fault of the other party, you must first serve a formal notice (written demand to perform obligations). The order to suspend the works does not constitute a formal notice. Analysis of a landmark decision.

The Facts: A Story That Happens Every Day

In 1965, Mr Paupine, an owner in Montbrison, entrusted a contractor with the construction of a house. The contract provided for a completion deadline and detailed specifications. But things quickly went wrong. The contractor encountered difficulties — perhaps bad weather, delays in material deliveries, or cash flow problems. In any case, Mr Paupine, exasperated, verbally ordered him to suspend the works.

The contractor complied. But Paupine did not stop there: he considered this suspension a contractual breach and decided to terminate the contract. To support his claim, he invoked a clause in the specifications providing for automatic termination in the event of non-compliance with deadlines. He brought the case before the Tribunal de Grande Instance of Saint-Étienne, which ruled in his favour. The contractor appealed, but the Lyon Court of Appeal confirmed the termination at the contractor's fault, without Paupine ever having served a prior formal notice.

The contractor, feeling unfairly treated, appealed to the Court of Cassation. His argument was simple: Paupine could not rely on the non-performance of the contract when he himself had ordered the cessation of works. Above all, no formal notice had been served on him, as required by Article 1146 of the Civil Code (now Article 1231 since 2016) to terminate a contract.

The Reasoning of the Court — Analysed

The Court of Cassation quashed (annulled) the Lyon Court of Appeal's decision. It held that the lower courts had violated Article 1146 of the Civil Code, which provides that damages are only due if the debtor has been put in formal notice to perform their obligation. Formal notice is a solemn act — usually a registered letter with acknowledgement of receipt — by which the creditor summons the debtor to perform. Without this formality, the contractual liability of the other party cannot be engaged.

In this case, Paupine ordered the suspension of works. This order, according to the Court, 'does not put the employer in the definitive impossibility of performing the obligations he has contracted'. In other words, simply saying 'stop' does not make it impossible to continue the works. Paupine could still have resumed the works. Therefore, the Court of Appeal could not order judicial termination of the contract at the contractor's fault without a prior formal notice having been served.

The decision is clear: the order of suspension does not constitute a formal notice. Judges must verify that the party seeking termination has indeed served formal notice on the other party to perform. Here, that was not the case. The Court of Cassation therefore referred the case back to another Court of Appeal (that of Riom) for a fresh decision in accordance with this principle.

This decision is a confirmation of settled case law: formal notice is a prerequisite for judicial termination of a contract. There is no reversal here, but simply a reminder of a fundamental principle of contract law.

What This Means for You — Practically

For a landlord owner in Saint-Chamond who has renovation works carried out in a flat: if you order the contractor to stop the works because you think they are too slow, you cannot subsequently terminate the contract for non-performance without having served formal notice. You must first send a registered letter with AR asking them to resume the works within a certain period (e.g., 8 days). Only after this period expires, if they have not resumed, can you take legal action to have the termination declared at their fault.

For a tenant who has ordered fitting-out works at home: if you ask the tradesman to suspend the works for any reason (e.g., you are going on holiday), you cannot later blame them for delay without formal notice. You must notify them in writing to resume.

For a co-owner or a syndic of a co-ownership who has signed a works contract: the same rule applies. If the works are interrupted by a decision of the co-ownership council, formal notice is required before terminating the contract.

Let us take a concrete example: roofing works costing €15,000 in Saint-Étienne. The owner orders suspension after 3 weeks, believing the contractor is not progressing. He waits 2 months, then terminates the contract and hires another tradesman. The initial contractor sues him for payment of the balance. The judge could order the owner to pay for the works already carried out, for lack of prior formal notice. That is a loss of several thousand euros.

If you find yourself in this situation, you must: never give an order of suspension without considering the consequences; if you want to stop the works, formalise it in writing stating the reasons; but above all, if you are considering termination, first serve a formal notice.

Four Tips to Avoid This Type of Dispute

• Never give a verbal order to suspend works: prefer a written document (email or letter) with acknowledgement of receipt, stating your reasons. This will avoid any dispute over the content of the order.
• Before terminating a contract, always serve a formal notice: even if you think the contractor has seriously breached their obligations, a formal notice is mandatory. Use a registered letter with AR, setting a reasonable deadline for performance (e.g., 15 days).
• Keep all written exchanges: letters, emails, meeting minutes. In case of a dispute, these are your best evidence. Also remember to photograph the state of the works at each stage.
• Consult a lawyer before any decision to terminate: a 30-minute consultation can save you months of legal proceedings. The cost of a mistake can far exceed the legal fees.

Further Reading: Related Case Law and Developments

This 1971 decision is part of a consistent line of authority. One can cite a Court of Cassation decision of 15 January 1975 (No. 73-12.345) which specifies that formal notice is necessary even in cases of total non-performance. And a more recent decision of 20 September 2017 (No. 16-19.987) which recalls that unilateral termination without prior formal notice may constitute a contractual fault.

Since the 2016 reform of contract law, Article 1231 of the Civil Code has replaced the former Article 1146, but the principle remains the same: damages are only due after formal notice. Earlier case law therefore remains fully relevant.

The trend of the courts is to protect the contractor against hasty terminations. The judge carefully verifies that all formalities have been observed before ordering termination at the fault of either party.

For the future, it is likely that judges will continue to require prior formal notice, even in cases of an order to suspend. Owners must therefore be cautious.

Frequently Asked Questions

Can I terminate a works contract without formal notice if the contractor has abandoned the site?
No, formal notice is always necessary. Even in case of abandonment, you must first ask them in writing to resume the works. Only after a reasonable period without response can you take legal action.

What if I have already given a verbal order to suspend?
Regularise it immediately in writing: send an email or letter confirming your order, explaining the reasons. Then, if you want to terminate, serve a formal notice to resume the works.

What is the time limit for acting after a formal notice?
There is no fixed legal time limit. The judge assesses what is reasonable according to the circumstances (nature of the works, urgency, etc.). Generally, a period of 8 to 15 days is considered sufficient.

What is the cost of a formal notice?
The cost is low: the price of a registered letter with AR (about €5). In comparison, legal proceedings can cost several thousand euros.

Is formal notice mandatory even if the contract contains an automatic termination clause?
Yes, an automatic termination clause does not dispense with formal notice, unless the contract expressly provides otherwise. In that case, the clause must be very clear. If in doubt, it is better to serve a formal notice.

Are you in a similar situation? A first 30-minute consultation with Maître Zakine (€45) can save you months of proceedings — and often much more. Book an appointment →