To benefit from the procedure for treating over-indebtedness, it is very preferable that none of the debts are originally due to a fault, judged the Court of Cassation.
An entrepreneur, whose catastrophic financial situation had been partly created by deliberate breaches such as non-compliance with tax obligations, was unable to obtain admission of his case.
This debtor, who was unable to cope with several million euros of debt, maintained that his situation of over-indebtedness was constituted even if we did not take into account the debts caused by his faults, such as the absence of tax declarations, which had resulted in onerous convictions and taxation. He added that he had not fulfilled his obligations for health reasons and that even if he had been fined financially for his delays or omissions, this should be taken into account.
But the Court of Cassation did not admit anything. The judge is sovereign in the matter, to assess good or bad faith, she recalled, and even if a third of the debts is not linked to the origin of the voluntary errors which notably led to a tax adjustment and a conviction, the judge was able to consider that this indebted debtor was not acting in good faith and that the over-indebtedness commission was right not to admit that he benefited from discounts, rescheduling or cancellation of debts.
How to judge good faith?
On the subject of good faith, the Court already ruled in February 2011 that it was not necessary to have multiplied bad checks. She added in March 2013 that we should not have increased consumer credit either, and in October 2015 that we should have applied the first measures imposed by the over-indebtedness commission.
(Cass. Com, 29.6.2023, T 21-18.454).
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