LUXEMBOURG COMMERCIAL CODE BOOK III
LexInter | March 17, 2015 | 0 Comments

LUXEMBOURG COMMERCIAL CODE BOOK III

BOOK III. – Bankruptcy, bankruptcy and reprieve

(L. July 2, 1870)

General provisions

Art. 437. Any merchant who stops making payments and whose credit is damaged is in good working order.

bankruptcy.

Anyone who no longer trades can be declared bankrupt, if the cessation of payments

dates back to a time when he was still a trader.

The bankruptcy of a merchant can be declared after his death, when he has died in a state of

cease of payment.

1 ° To be able to be declared bankrupt, you must be a trader or have been a trader within six months

prior to the declaration of bankruptcy; can no longer be declared in a state of bankruptcy a trader who for more than six months has

ceased all trade. Court February 17, 1876, 1, 199; Court January 28, 1887, 3, 145; Diekirch June 20, 1890, 3, 164.

2 ° The law considers the merchant as bankrupt simply because he has stopped his payments and his credit is damaged;

it follows from this principle that the consular tribunal is obliged to draw the legal consequence of the patent facts in question, that is to say

say to declare bankruptcy, without being able to have regard neither to the possible solvency of the debtor, nor to the motives more or less

interested parties who determined his creditor to file for bankruptcy.

In particular, the court could not grant the debtor in default of payment the time limits by application of the law of 18

March 1915, this does not apply to a general suspension of payment. Lux. March 18, 1916, 10, 216.

3 ° The constitutive elements of bankruptcy, namely the cessation of payments and the disturbance of credit, may result not

only prosecutions directed against the trader or protests, but all patent facts attesting to the disarray of business

debtor and his inability to meet his obligations.

However, only liquid and payable debts can be taken into consideration, with the exception of those which are

seriously contested. Court February 4, 1933, 13, 51.

4 ° A temporary financial inconvenience of the debtor does not constitute the cessation of payments necessary to bring about its

bankruptcy. Court February 20, 1934, 13, 268.

5 ° The commercial court seized of a request for suspension of payment does not commit any excess of power by pronouncing

automatically the bankruptcy of the debtor if the examination of the request establishes that this one has stopped its payments and that its credit is disturbed;

it is only after having granted a temporary stay and given the opinion required by Articles 597 and 598 of the Commercial Code that

is provisionally relinquished in favor of the Court until after the latter’s decision. Court November 6, 1934, 13, 296.

6 ° The commercial debt being the result of an act of commerce, but not constituting its exercise, it follows that the only

the fact that the defendant in an application for a declaration of bankruptcy is bound by commercial debts cannot confer on him the quality of

trader, nor leaving justify his declaration in a state of bankruptcy. Lux. November 3, 1960, 15, 286.

7 ° If the subscription of a bill of exchange constitutes the exercise of a commercial act, this subscription does not provide

however, never by itself resources to the one who practices it and is therefore not likely to be the object of a

profession. It follows that the only subscription of bills of exchange practiced, even in the usual way, by the defendant to

a request for a declaration of bankruptcy cannot confer on him the quality of trader, nor can he justify his declaration in good condition.

bankruptcy. Lux. November 3, 1960, 18, 286.

8 ° Third parties, and as such the personal creditors of the partners, may if they have an interest in it, invoke against the partners, and

even have the company declared null and void.

– This faculty is a right that the personal creditors of a partner derive directly from the law and, by exercising this

option, they act jure proprio and, therefore, as a third party from the point of view of article 42 of the Commercial Code.

– In the event of a competition from social creditors who prefer to consider the company as valid, with personal creditors

wishing to have it annulled, it is the latter who must prevail.

– The cancellation of a company having a retroactive effect, it follows that a canceled company has never had a legal existence and

that its declaration of bankruptcy is impossible in law and in fact. Lux. April 8, 1911, 9, 229.

9 ° For there to be a declaration of bankruptcy of a merchant after his death, he must have died in a state of cessation of

payments; this cessation must be effective; however payments to account and isolated payments intended rather to mask

the state of insolvency are powerless to annihilate this state, which actually preexisted at the critical time. Court May 15

1903, 6, 399.

10 ° The fact, even customary, of teaching a science or a technique for remuneration does not constitute an act of

trade and cannot attribute the quality of trader to the director of the establishment.

29

In particular, the director or the operator of a driving school cannot be considered as having the quality of

trader and therefore cannot be declared bankrupt. Lux. December 8, 1965, 20, 44.

11 ° If a business is operated not by its owner but by a third party acting in his personal name and for

on its own account, this exploitation results in a repetition of commercial acts, carried out in a professional capacity, which

is sufficient to confer on the operator the quality of trader, although the goodwill does not belong to him. The operator is

therefore likely to be declared bankrupt. Lux. November 23, 1967, 21, 99.

12 ° If the dissolution of a company puts an end to its legal existence, it is however supposed to survive for the needs of the

liquidation; it follows that a company in liquidation can be declared bankrupt under its old name and retains at

for these purposes the registered office designated in its constituting act.

When there is a marked confusion of activity and assets between two companies and one of these companies has been

declared bankrupt, the court is entitled to pronounce the extension of the bankruptcy with regard to the other company. Lux. February 18, 1970, 21,

393.

13 ° A judgment declaring bankruptcy, challenged by way of opposition, may be reversed, either because of the incompetence of the

court having declared bankruptcy, either for lack of the quality of trader, or finally for lack of proof of the cessation

payments and the credit crunch.

The conditions required for bankruptcy are assessed on the day of the declaration of bankruptcy.

The court seised of an opposition or an appeal against a judgment declaring bankruptcy must relate to the day of that

judgment and cannot reform it on the grounds that the debtor has in the meantime improved his financial situation, either by

disinteresting its creditors, or by obtaining credit. Lux. Jan. 11, 1967, 20, 361.

14 ° A bankruptcy can only be declared on the double condition that the merchant debtor is in a state of cessation of

payment and his credit shaken.

If the refusal to pay a single debt may be sufficient to establish the cessation of payments, the debt must nevertheless be

liquid, payable and certain.

To be certain, a debt must not be contested, neither in its existence, nor in its amount, nor even in its mode of payment.

payment, all on the condition that the dispute does not constitute a purely dilatory means.

A creditor who is unsuccessful in his application for a declaration of bankruptcy cannot, by this sole fact, be condemned to

damages to the debtor.

If, however, he has committed an abuse of rights by acting in bad faith or recklessly, he must be ordered to make reparation.

the damage suffered by the debtor.

A summons for a declaration of bankruptcy is only admissible if the default in payment is the unequivocal manifestation of

the impossibility for the debtor to meet its commitments; it should not be used as a means of intimidation against

the debtor as a bonus.

The bearer of an accepted and protested draft who immediately assigns the drawee into bankruptcy commits a serious error,

equipollent to fraud and generating liability, while the normal method of collecting bills of exchange is

request for payment submitted to the competent court. Lux. Jan. 14, 1972, 22, 306.

15 ° The court should not be concerned with knowing whether the bankruptcy is in accordance with the interests of the creditors. When the three

legal conditions for bankruptcy are met (merchant status, suspension of payments, credit disturbance) he has the right to

duty to declare bankruptcy. Court November 18, 1998, 31, 69.

16 ° A trader can be declared bankrupt for default of payment of civil debts, and even of a single civil debt –

not even in connection with its commercial activity -, if the other conditions of bankruptcy are met. Court 18

November 1998, 31, 69.

Art. 438. Bankruptcy is qualified as simple bankruptcy and punished on a correctional basis, if the trader

bankrupt is in one of the cases of serious fault provided for in Chapter I of Title II below.

It is qualified as fraudulent bankruptcy and punished criminally, if the bankrupt merchant is found

in one of the cases of fraud provided for in Chapter II of the same title.

Art. 439. The requests for a stay are made and a decision will be taken in accordance with the provisions

of Title IV below.

30

TITLE I. – Bankruptcy 1

Chapter I. – Confession, declaration of bankruptcy and

cease of payment

Art. 440. (L. July 21, 1992) Any trader and any commercial company which ceases its

payments must within one month confess to the clerk of the district court sitting in matters

of its domicile or its registered office.

In the case of a general partnership, a limited partnership or a partnership

cooperative in which the extent of the partners’ liability is unlimited, the declaration must

contain the names and addresses of each of the partners indefinitely bound by the commitments of the

society.

For all companies, the declaration must indicate the names of the directors or managers. The

proceedings will continue against them, who are required to provide the judge-commissioner and curators

all information and to appear before them when required.

1 ° It is generally accepted that the provision of article 440 of the French Commercial Code, expressly targeting companies in

collective name, also applies to other companies and in particular to public limited companies.

Consequently, the Luxembourg courts have no jurisdiction to declare the bankruptcy of a public limited company whose

head office of the main establishment is abroad. Lux. May 10, 1952, 16, 177.

2 ° The head office of the principal establishment of a company must be understood to mean the place where its most important center of activity is located.

important from the point of view of its affairs; this head office may not be the registered head office of the company. Lux. May 10, 1952,

16,177.

Art. 441. The bankrupt will attach to his confession:

(1) the report of its affairs or a note indicating the reasons which would prevent it from filing it;

2 ° (L. December 19, 2002) the books prescribed by articles 9 to 11 of the Commercial Code; these

registers will be stopped by the clerk, who will note the state in which they are.

The balance sheet will contain the enumeration and valuation of all movable and immovable property of the

debtor, the statement of active and passive debts, the table of profits and losses, the table of

expenses; it must be certified true, dated and signed by the debtor.

The clerk will certify at the bottom of the bankrupt’s confession and the documents annexed thereto the date of their delivery to the

registry, and issue a receipt, if required.

The delivery to the registry of all other documents relating to the bankruptcy will be noted in the same

manner, without it being necessary to draw up any other deed of deposit.

Art. 442. (L. July 21, 1992) Bankruptcy is declared by a judgment of the district court

sitting in commercial matters, delivered either on admission of the bankrupt, or on summons from one or more

creditors, either ex officio. Except in the event of justified necessity specifically according to the elements of the

cause in the declaration of bankruptcy, the court will declare bankruptcy ex officio only after having

summoned the bankrupt through the registry to the council chamber to hear him about his situation.

By the same judgment or by a subsequent judgment rendered on the report of the commissioner, the

district court sitting in commercial matters, will determine, either ex officio or on the

prosecution of any interested party, the time at which the suspension of payment occurred.

1 See Council Regulation (EC) No 1346/2000 of 29 May 2000 on insolvency proceedings, OJ L 160/1 to L 160/18

published in the Annex to the New Code of Civil Procedure.

31

With the exception of article 613, this period may not, however, be fixed at a date later than

six months prior to the declaration of bankruptcy.

In the absence of a special determination, the suspension of payment will be deemed to have taken place from the

declaration of bankruptcy, or from the day of death, when bankruptcy has been declared after the

death of the bankrupt.

No request to fix the suspension of payment at a time other than that which

result from the declaratory judgment or from a subsequent judgment, will not be admissible after the day fixed for the

closing of the minutes of verification of claims, without however prejudice to the way of opposition

open to those interested by article 473.

1 ° A foreign judgment declaring bankruptcy cannot have legal effects on Luxembourg territory as long as it

is not covered by the formality of the exequatur, which alone can make enforceable on the national territory of acts or judgments

from foreign authorities. Lux. February 5, 1898, 4, 466.

2 ° The bankruptcy law, insofar as it regulates the state and the capacity of the bankrupt is a personal statute and therefore this capacity is

regulated according to the law of the country where the bankruptcy was opened. Diekirch Aug 2, 1894, 4, 17; Court July 10, 1891, 4, 44; Lux. 22 january

1909; conf. Court June 18, 1909, 8, 22.

3 ° The trustees appointed by foreign judgment can therefore take legal action in the Grand Duchy, before the judgment

declaration of bankruptcy has been made enforceable there. Court July 10, 1891, 6, 44.

4 ° A Belgian declared bankrupt in France must be deemed to be such in the Grand Duchy, without it being necessary for the

declaratory judgment has been made enforceable by the Luxembourg courts. Diekirch August 2, 1894, 4, 17.

5 ° A German declared bankrupt in Germany must be deemed to be such in the Grand Duchy, without it being necessary

that the declaratory judgment has been made enforceable by the Luxembourg courts. Lux. January 22, 1909; conf. Court June 18

1909, 8, 22.

6 ° The opening of the bankruptcy can only be fixed on the day when there was suspension of payment and when the credit was damaged; this

state must result clearly from the articulated facts and the judge has a discretionary power to appreciate the relevance of these facts; a

simple protest does not necessarily imply the state of bankruptcy, especially when it is not accompanied by other

circumstances which demonstrate that there is an obvious default. Lux. December 5, 1874, 1, 6.

7 ° The period which can be fixed as being that of the suspension of payment is limited, in general principle, by the six

months preceding the declaration of bankruptcy and, by exception, by the request for a stay (art. 613); she cannot under any

pretext to be postponed beyond these two dates. Lux. June 24, 1876, 1, 209.

8 ° The Court being invested, by the devolutive effect of the appeal of the power to know the difficulties of fact and of law submitted to the

first judge, for whom it is substituted with the same extent and fullness of jurisdiction, can, if necessary, raise the

cessation of payment at the same time when the trial judge could have fixed it, i.e. six months before the date of

judgment appealed from. Court January 28, 1887, 3, 165.

9 ° In the presence of the principles of the unity and universality of bankruptcy, the declaratory judgment of bankruptcy, rendered by a court

foreigner, has, with regard to the capacity and assets of the bankrupt in Luxembourg, the authority of res judicata and produces the same effects there

only in the foreign country and that even before any sentence of exequatur. Lux. Oct. 11, 1961, 18, 470.

Art. 443. Repealed (L. January 8, 1962)

32

Chapter II. – Effects of bankruptcy

Art. 444. The bankrupt, from the declaratory judgment of the bankruptcy, is automatically relieved of

the administration of all its assets, even of those which may fall to it as long as it is in a state of bankruptcy.

All payments, transactions and acts made by the bankrupt, and all payments made to the bankrupt since that

judgment are null and void.

1 ° The law on bankruptcy, insofar as it regulates the state and the capacity of the bankrupt, is a personal statute; therefore the relinquishment

which results from the bankruptcy is inherent in the person of the bankrupt and extends to all his assets, whatever the country where they are located.

Diekirch Aug 2, 1894, 4, 17; Lux. January 22, 1909, 8, 22.

2 ° The sales contract under the terms of which the price is to be fixed by experts to be appointed either by mutual agreement or by a

determined court, is valid, and the state of bankruptcy of one of the contracting parties, which has arisen since the conclusion of the contract but

before the appointment of the experts responsible for fixing the sale price, is not obstructing the appointment of the experts by the court nor

price fixing; indeed, since the perfection of the contract cannot be contested, it is its execution alone which remains subject to

the fulfillment of the condition provided for in the contract and this not having become impossible, the state of bankruptcy does not preclude

obstacle. Lux. January 30, 1891, 3, 18.

3 ° In matters of accident insurance, the right to compensation is not exclusively attached to the person of

the insured and therefore the body of creditors of the bankrupt insured has quality and title to act on the insurer in payment of

compensation. Lux. July 19, 1893, 3, 463.

4 ° The curator of a bankruptcy is not a third party under the terms of article 1328 of the Civil Code administering the property of the bankrupt

relieved of this administration by the law and the declaration of bankruptcy, he represents both the bankrupt and the mass of his

creditors; he is in particular the successor of the bankrupt when it comes to assessing the result of the agreements made and the accounts

settled in good faith by the bankrupt still in charge of his affairs; especially in this capacity he cannot repel

agreements made by the bankrupt, which would not have acquired a certain date before the bankruptcy by the sole reason of the absence of this date,

while he does not argue these conventions of fraud or antedate. Court March 17, 1881, 2, 41.

5 ° The curator of a bankruptcy is obliged to respect, in the same way as the bankrupt himself, the contracts that the latter has

validly concluded before the declaration of bankruptcy; especially he is obliged to respect the insurance contract in which he

It is stipulated that the payment of the real estate allowance will only be made if the building is in the process of being rebuilt. Courtyard 12

May 1893, 3, 237.

6 ° The question of whether the creditors, in so far as they constitute a body represented by the curator, are in relation

to the bankruptcy of third parties or successors, is usually resolved in the sense that the creditors are not in a way

absolute, exclusively third party or exclusively successor in title, but that they can have sometimes one, sometimes the other quality, according to

that they derive their rights from their own titles or from the titles of their debtor; according to this distinction the mass is having cause

bankrupt when exercising his rights under the general provision of article 1166 of the Civil Code or of the

particular referral to article 444 of the law of July 2, 1870 and it is third in relation to the bankrupt, when it exercises the rights that the

law confers it directly either by virtue of article 1167 of the Civil Code, or by virtue of articles 445 to 449 of the law of July 2

1870; especially the curators who, before the proceeding, recognized the sincerity of a deed of lease by a pure denunciation and

simple of this same lease, cannot, during the proceedings, criticize this lease as a third party for not having a certain date; the

curators who can no longer exercise their own right under these circumstances, either from article 1167 of the Civil Code, or from

Articles 445 to 449 of the Commercial Code can only exercise the rights of the bankrupt; these rights, they cannot exercise them

only to the extent and within the limits where they belong to the bankrupt himself; however, the bankrupt cannot criticize a lease by him

consented, so as not to have a certain date; the lease must therefore, in the given circumstances, be proof of its date with regard to

creditors, as with respect to the bankrupt. Lux. February 8, 1902, 6, 312.

7 ° An action brought by two curators in the absence of the third is admissible if they have been authorized for this purpose by the

the Commercial Court. Lux. July 4, 1894, 4, 388.

8 ° When several bankruptcy trustees have been appointed, each of them has a mandate to act separately in the interest of the bankruptcy.

mass. Lux. January 30, 1895, 4, 34.

9 ° It is in principle, in matters of bankruptcy, that the creditor cannot exercise an action which interests the whole mass; he doesn’t

is however not so of the action for damages, which belongs to any one is injured in his rights and whose exercise

is entirely independent of the intervention or the adhesion of a third party; this rule does not apply to the bankrupt masses.

that as long as the liquidation is not completed; when bankruptcy operations are closed, bankruptcy creditors

enter into the exercise of their personal actions. Lux. March 20, 1891, 2, 344.

10 ° The trustees of a bankruptcy represent both the bankrupt person and the body of creditors of the latter; in

this dual quality they are not only responsible for administering the assets of the bankruptcy, but authorized to follow, as

plaintiffs or as defendants, all actions aimed at the conservation of the asset which must serve as pledge to the

creditors, as well as the reconstitution or increase of this asset in the common interest of the latter; it is

otherwise when the action has as its object only the personal fortune of one or the other of the creditors; in this case the right to act

belongs exclusively to the interested creditor. Court July 2, 1880, 2, 49; Lux. August 10, 1891, 3, 537.

11 ° The creditors of a bankrupt acting in the interest of all the creditors and not to claim a purely personal right,

are admissible to join the request made by the curators. Court July 2, 1880, 2, 49.

12 ° The intervention of a bankruptcy creditor in a lawsuit initiated by the curator is justified, as long as its production

is not definitively rejected and annulled by a final decision; this intervention cannot therefore

be refused for the sole reason that the production is contested and not admitted to the liabilities of the bankruptcy. Lux. February 8, 1902, 6,

312.

33

13 ° The curator of a bankrupt general partnership has capacity to file as a liability for the personal bankruptcy of each of the

partners for the full amount of social liabilities, except deducting from this production the amount of production

individually made social creditors. Court January 26, 1885, 2, 448.

14 ° When, in a request for separation of property brought by the wife against her husband declared bankrupt and

against the bankruptcy trustee, the defendants succumb, they must, in accordance with article 130 of the Code of

civil proceedings be ordered to pay the costs and each for half; the costs incurred by the plaintiff are to be deducted from

the assets of the bankruptcy, namely: those exposed against the husband, on an unsecured basis and those exposed against the curator, on a privileged basis.

Diekirch November 22, 1900, 6, 100; Lux. May 4, 1904, 6, 286; Contra: Lux. June 10, 1896, 4, 286.

15 ° The declaratory judgment of bankruptcy rendered abroad has, as regards the incapacity of the bankrupt, the force of res judicata in the

Duchy and produces the same effects there as abroad, without it having to be declared enforceable. Court December 13, 1932, 13, 356.

16 ° The prior exequatur is only required when it comes to carrying out actual acts of execution, that is to say

measures of constraint on the person or the property of the bankrupt, and the foreign curator has the capacity to validly pose in the

Grand Duchy, before any exequatur award, simple conservatory acts, for example pursuing the recovery of

claims or intervene in a proceeding concerning the bankrupt. Court December 13, 1932, 13, 357.

17 ° As a result of his relinquishment, the bankrupt does not have the capacity to make a confession opposable to the mass. Diekirch January 24

1934, 13, 317.

18 ° The litis-decisive oath referred to the bankrupt is inadmissible when this oath involves a transaction and the bankrupt is

unable to compromise. Diekirch July 9, 1932, 13, 261.

19 ° The bankrupt, even though he has been deprived of the administration of his property, is not in a state of interdiction and cannot be denied

right to engage in work to ensure one’s existence and to make commitments or to make acts of disposition

valid, but the fruits of its activity increase the active mass for all that exceeds the needs of its maintenance and

that of his family, after deduction of the acquisition costs he incurred and the legitimate expenses including the newly acquired property.

acquired are encumbered. Court March 3, 1921, 11, 546.

20 ° By effect of a declaration of bankruptcy, the current account automatically expires; by virtue of the principle of invisibility

from this account, the compensation between the various items registered therein takes place automatically up to the due amount. Courtyard 2

March 1923, 11, 134.

21 ° If the credit and debit items of a current account form an indivisible whole, the account of which allows

only to release the balance payable by one or the other of the correspondents, so that this balance is opposable to the mass

creditors of the bankrupt, the same principle cannot be applied to the respective balances of several existing current accounts

between the same parties, each account in this case keeping its own individuality.

Even if it has been agreed that the accounts are to be considered as constituting a single current account and that at any

the moment and on simple notice the debit balances can be transferred to the accounts payable or vice versa, always

that as long as the effective transport of the respective masses of assets and liabilities has not been carried out, the individual accounts remain

with their own personality so that in the event of a declaration of bankruptcy they cannot compensate each other and Article 445 of the

Commercial code must eventually find its application. Lux. November 8, 1930, 13, 269.

22 ° From the declaration of bankruptcy, no compensation, whether legal, judicial, or conventional can be

produce even between pre-existing receivables, if they have lacked until that date one of the three qualities of liquidity,

exigibility and fungibility. Court March 2, 1923, 11, 134.

23 ° As long as there is no declared bankruptcy, the action for rescission of the sale can be brought by the seller against the buyer

unpaid movable objects.

The action duly brought before the opening of the bankruptcy constitutes for the plaintiff an acquired right to see himself

judicially recognize the right of rescission which belonged to him at the time of the lodging of the request and this notwithstanding the

occurrence of bankruptcy. Court June 16, 1938, 14, 193.

24 ° The concession of cabaretage, being susceptible of alienation cannot be considered as a right attached to the

person of the bankrupt and therefore falls into the bankruptcy estate under article 444 of the Commercial Code. Court 7

March 1924, 11, 535.

25 ° After the closing of the bankruptcy, the relinquishment of the bankrupt remains as regards the values ​​which, wrongly, were not understood

in liquidation. Lux. January 14, 1914, 10, 32.

26 ° The set-off of reciprocal claims and debts of the bankrupt and a third party may take place even during the period

suspect, if it has been agreed in good faith before the beginning of this period between the two contracting parties.

The rules and practices of the bars admit that the lawyer agrees with his client, of whom he is the usual adviser with a view to

the recovery of numerous debts, to withhold its costs and fees from the sums recovered, which implies, in favor of

of the lawyer, the compensation between the debts he receives and his fees. Agreed in good faith, this compensation

takes place even for the professional duties performed by the lawyer during the suspicious period, so that the lawyer is not

required to pay the fees relating to the bankruptcy estate and therefore be subject to the law of dividends.

If, in principle, the relinquishment resulting from a declaration of bankruptcy precludes any set-off between

claims and debts of the bankrupt hitherto neither liquid nor payable, it is otherwise when the reciprocal claims arose

from the same source and result from the same contract concluded before the suspect period with a third party.

Due to the original connection existing in this case and the interdependence of the obligations of the bankrupt and the third party, are

compensable, for the benefit of the third party, all reciprocal debts prior to the declaration of bankruptcy, provided

that the claims of the third party are certain in principle, even if, on the day of judgment, they have not been settled. Lux. 15

June 1966, 20, 212.

27 ° The bankruptcy trustee has no standing either to bring an action for compensation for non-pecuniary damage suffered by the bankrupt nor

to appeal against a judgment awarding it compensation for non-pecuniary damage. Court October 10, 1978, 24,

204.

28 ° The bankruptcy judgment comes into effect at midnight on the day of pronouncement, so that the entire day during which

34

The bankruptcy judgment intervenes is part of the bankruptcy period and that the payments made on that same day are legally void.

Court January 21, 1981, 25, 373.

29 ° Following the abolition of the reproach procedure, a bankrupt can be heard as a witness in disputes

concerning his own liabilities. Court July 10, 1991, 28, 231.

Art. 444-1. (L. July 21, 1992) (1) (L. December 18, 2009) If the bankrupt or the managers of law or of

fact, associates or not, apparent or concealed, paid or not, of a company declared bankrupt,

whether in office or withdrawn from the company at the time of the declaration of bankruptcy, have contributed to the

bankruptcy by a serious and characterized fault, the district court sitting in commercial matters

who declared bankruptcy or, in the event of bankruptcy declared abroad, the district court of

Luxembourg sitting in commercial matters, can pronounce against these persons

the prohibition to exercise directly or through an intermediary a commercial activity as well as a

function of director, manager, statutory auditor, statutory auditor, approved company or

any function conferring the power to bind a company. The ban is mandatory

against the one who is condemned for simple bankruptcy or fraudulent bankruptcy.

(2) The request must be made by the curator or by the state prosecutor near the court

of competent district, within three years from the declaration of bankruptcy.

(3) The duration of the prohibition to exercise may not be less than one year nor more than twenty years.

(4) The case is brought and heard following the commercial procedure.

(5) The prohibition ceases in all cases if:

– the declaratory bankruptcy judgment is reported,

– the bankrupt obtains the approval of the composition,

– the bankrupt obtains his rehabilitation.

(6) The prohibition pronounced by the court is mentioned in the register of commerce and

companies. This registration is canceled when the ban has ceased to be effective.

Art. 445. Are null and void, in relation to the mass, when they have been made by the debtor

since the time determined by the court as being that of the cessation of its payments or

in the ten days which will have preceded this time:

All acts of transfer of movable or immovable property free of charge, as well as deeds,

commutative or onerous transactions or contracts, if the value of what was given by the bankrupt

significantly exceeds that of what he received in return;

All payments, either in cash or by transport, sale, clearing or otherwise for

unmatured debts and for matured debts, all payments made other than in cash or bills of

trade;

Any conventional or judicial mortgage and all rights of antichresis or pledge established

on the assets of the debtor for debts previously contracted.

1 ° Article 445 is only applicable to the conventional or judicial mortgage and cannot be extended to the mortgage

legal. Lux. July 2, 1902, 6, 283.

2 ° Since the pledge contract is an essentially real contract which is only formed by the delivery of the thing between

the hands of the creditor, is void, by virtue of article 445, the pledge made since the time of the termination of the

payments, for a previously contracted debt, even though it had been the subject of a previous pledge,

granted when the claim arises. Cass. December 23, 1892, 3, 163.

3 ° Article 445 of the Commercial Code encompasses all acts of donation, even if they do not transfer property, and in particular

pure and simple waivers of a right. Is therefore null with regard to the mass a release of mortgage granted

during the suspect period although the guaranteed debt is not extinguished, such release constituting an act of liberality.

Diekirch January 24, 1934, 13, 317.

4 ° The nullity of article 445 of the Commercial Code does not apply to the mortgage constituted during the period

suspect in order to guarantee an advance to be made after the act and without there being fraud. Court February 20, 1934, 13, 261.

5 ° The clause by virtue of which the seller of a new car undertakes to take back the car at a determined price

of its purchaser forms only one of the conditions of the sale of the new car and forms part of this contract

perfectly valid. Occurring during the suspicious period, this transaction does not have the character of a donation in payment

prohibited by article 445 of the French Commercial Code. Court July 18, 1934, 13, 236.

6 ° The agreement to terminate a sale for non-payment of the price is equivalent to a giving in payment. In

Consequently, when such termination has taken place during a suspicious period, it is automatically void in accordance with article 445

of the Commercial Code. Court June 30, 1933, 13, 129.

7 ° If the resolution of a sale and the return of the objects sold to the seller, which is the result thereof, are liable to

cancellation by application of articles 445 and 446 of the French Commercial Code, when they were made during the period

suspect, it is only as acts of the debtor which give the resolution an amicable character and which make the restitution

a donation in payment.

In the case, on the contrary, where the seller, resulting from an express termination clause, inserted in the contract of sale on credit, opts

for the resolution, this results from an act of the creditor, act which occurs independently of the current will of the debtor,

and it remains validly acquired, even if it occurs during the suspect period, on the sole condition that the contract which

serves as a basis for it to be itself unassailable. Court April 25, 1967, 21, 65.

8 ° Constitutes a compensation agreement the clause of the contract of sale of a motor vehicle stipulating that in the event of

termination of the sale through the fault of the buyer, the down payments made by him are acquired by the seller as enjoyment, usury,

termination indemnity etc., without prejudice to further damages. Consequently this clause is void at

look at the bankruptcy of the buyer, if it is applied in suspicious period, and the seller must repay in the bankruptcy of the

installments received, even if it means being collocated for the same amount in unsecured liabilities. Court June 30, 1936, 14, 12.

9 ° A promise of mortgage is not equivalent to the act of constitution. Consequently, the mortgage constituted by

the bankrupt in a suspicious period for a previously contracted debt, even though the mortgage promise was

concurrent with the loan. Court January 5, 1933, 14, 219.

10 ° The retrocession in whole or in part of the thing sold to the seller following the termination of a contract of sale

operated during the suspicious period constitutes an irregular payment under the terms of article 445 of the Commercial Code prohibiting

for overdue debts all payments other than those made in cash or in commercial paper. Lux. June 14, 1951, 15, 162.

11 ° Is not null in relation to the mass the pledge which was constituted at the same time as the loan was made if the lender has not

had knowledge of the cessation of payments by his co-contractor, who was subsequently declared bankrupt. Lux. January 5, 1952, 15, 255.

12 ° The nullity of law, enacted by article 445 of the Commercial Code, having no other purpose than to maintain equality between

unsecured creditors and prevent the future bankrupt from favoring one of them by granting him a security that had not been

constituted when the debt arises, this nullity cannot apply to the sureties which have been constituted at the time

same where the debt was incurred.

Especially, if a loan was granted during the suspect period to the future bankrupt by means of the commitment made by the latter

to guarantee this loan by a pledge of the goodwill, but that this pledge could not be documented in writing until

a few days after the granting of the loan, the loan and the pledge of the goodwill merge into a single operation, in

so that the loan cannot legally be considered as prior to the pledging of the business. By way of

Consequently, the pledge of the business is not vitiated by application of article 445 of the Code of

trade. Court October 28, 1969, 21, 232.

13 ° If the bankrupt tutor has been opened by a bank a credit in current account and that for the guarantee of the commitments

taken he has, during the suspicious period, set up his business as a pledge, this pledge is null and void.

law, enacted by article 445 of the French Commercial Code, insofar as, at the time of the constitution of this security, the account

current already presented a debtor position at the expense of the future bankrupt. Lux. September 29, 1967, 21, 246.

14 ° In the event of a sale between the bankrupt and a third party during the suspicious period, the circumstance that the buyer was at

at the time of the sale of the bankrupt’s creditor and that the parties have stipulated that the price is compensated to the extent of the

claim of the purchaser, is not sufficient to render the sale null and void under article 445 of the Commercial Code, but it

In order for this article to be applicable, it must be established that it was not in fact, in the intention of the parties,

that of an diverted method of payment, respectively of a disguised giving in payment, contrary to the concept of equality

devoted to bankruptcy. Court November 10, 1926, 11, 247.

15 ° Transactions which are linked to a single market, form an indivisible whole and constitute the elements of a

single account, the final balance of which is the only one to be considered when it comes to settling the reciprocal situation of the parties, without

It is necessary to distinguish between the operations which constitute the execution of the contract and those resulting from its violation. Lux. 16

February 1929, 12, 349.

16 ° In the event of a credit opening, the debts of the creditor arise only through the use and as and when the use of the

credit; as a result, a mortgage created by the bankrupt during the suspicious period as security for a line of credit

is void only with respect to advances made prior to its constitution, but valid with respect to those made

later. If there has been a current account agreement between the parties, it is only when the account is closed that the quality of

creditor or debtor of either party can be fixed; owing to the indivisibility of the account, there is, as long as it lasts, neither

claim or debt, all reciprocal transactions constituting mere articles of debit and credit; it is so well

that provisional balances have been drawn up during the period of the account, the balances which these have shown, being

in turn become articles of account. It follows from these principles that in the event of a current account the debt of the creditor does not take

birth only when the account is closed and as a result a mortgage constituted during the suspect period but before the

closure of the account to guarantee the balance, is valid, although in fact all or part of the advances have been made

prior to its constitution. Lux. December 10, 1927, 12, 20.

17 ° A promise of mortgage is not equivalent to the act of constitution.

Consequently, the mortgage constituted by the bankrupt in a suspicious period for a debt previously

contracted, even though the mortgage promise was concomitant with the loan. Court January 5, 1938, 14, 219.

18 ° If, during the suspicious period, the bankrupt offers the seller the termination of a contract concluded with him and the seller

accepts this offer after the merchandise has been shipped and returned to the bankrupt’s stores, this agreement is void

under article 445-3 of the Commercial Code, when the bankrupt has become the owner of the goods and the debtor of the price

and that, consequently, by retroceding the goods for lack of being able to pay it, he freed himself from his debt other than

cash or commercial paper. Court May 20, 1927, 11, 309.

19 ° Waivers are not presumed; consequently the fact that the creditor filing as a liability of a bankruptcy

declared in the Grand Duchy has exercised, in a foreign country, the rights conferred on it by the legislation of that country, by practicing

36

foreclosures and steward of actions, can not imply on his part a waiver of filing for bankruptcy in the Grand Duchy; the

procedure instituted by him in a foreign country can have no other consequence than to oblige him, if necessary, by virtue of the

principles on the university of bankruptcy and on equality between creditors, which dominate the Luxembourg bankruptcy regime,

bring back to the mass the sums and values ​​that it would have realized in Germany to the detriment of other creditors. Court April 3

1914, 9, 118.

20 ° The termination of a contract of sale occurring during the suspect period but before the declaration of bankruptcy, by virtue of

a clause in the contract reserving ownership of the item sold to the seller until full payment of the sale price and

providing that in default of payment of a due date, the agreement is automatically terminated after a notice remained

unsuccessful, does not fall under the provisions of articles 445 and 546 of the French Commercial Code. Court July 2, 1935, 13,

519.

21 ° The drawer and the subscriber of a bill of exchange may agree that the terms and securities guaranteeing the debt

which serves as a provision for the bill will be passed on to the lessee, who is then subrogated in all the rights of the drawer.

Thus, when, in the deed of sale of an automobile, it was stipulated that the price would be payable by accepted drafts

installments, but would become payable for the whole on the day when the buyer resells the car, which the deed bears in addition that the

lessee will discount the drafts and that he will be subrogated in the rights of the seller, that this method of payment was usual

between parties, the lessee may, in the event of resale of the car, demand payment of the drafts without having to wait for the date

of their respective deadlines.

And in the event of the bankruptcy of the subscriber, the payment made in these circumstances before the expiry of the drafts, although he had

held in the six months preceding the bankruptcy, cannot be canceled as relating to an unmatured debt. Court November 21

1934, 13, 331.

22 ° A judicial mortgage created during the suspect period on the bankruptcy estate is null with regard to the bankruptcy estate.

property of the bankrupt by reason of a claim arising from an offense committed by him; this claim did not in fact arise at the time and

by effect of the judgment, but at the time of the occurrence of the event giving rise to the bankrupt’s obligation on the other hand, article 445, paragraph 4,

of the Commercial Code has a general scope by using the terms “previously contracted debts”, the law has referred to the case

the most frequent without thereby excluding debts arising from another cause. Court November 26, 1920, 11, 437.

23 ° When a sale of movable objects has been terminated by virtue of an express termination clause, the seller may claim,

with regard to the bankruptcy estate, the objects sold and delivered, even if the resolution of the contract only took place during the

suspicious period. Court March 10, 1931, 12, 216.

24 ° The bankruptcy trustee has sole capacity to pronounce the nullities provided for in articles 445 and 446 of the Code of

trade; these nullities once pronounced, their effects cannot however be restricted exclusively to the mass, but

they can also benefit certain creditors ut singuli; especially when the bankrupt had pledged objects

belonging to a third party and this pledge has been canceled under Article 445, the third party owner may claim them against the

bankruptcy mass. Lux. May 28, 1925, 11, 206.

25 ° Articles 445 and 446 of the Commercial Code and respectively of the Law of 2 July 1870 on bankruptcy do not apply

nullity of the acts referred to therein only in relation to the mass, that is to say only insofar as they are made in fraud of

mass creditors. Lux. July 29, 1911, 9, 216.

26 ° The circumstance that the buyer was aware of his obstructed situation at the time of the sale, cannot constitute

a cause of nullity of the sale, in accordance with articles 445 and 446 of the Commercial Code. Lux. July 29, 1911, 10, 293.

27 ° There is no legal provision preventing an assignment of a claim granted by the bankrupt before the suspect period

can be validly served on the ceded during this period. Court March 4, 1932, 12, 460.

28 ° Any legal, judicial or contractual compensation is prohibited in principle after bankruptcy, whereas, equivalent to

an abbreviated double payment, such compensation would allow the creditor who would benefit from it to escape the law of competition.

It is however admitted, by way of exception, that set-off after bankruptcy is possible between related debts finding their

cause in the same synallagmatic contract, and this even when one of the debts was born only after the bankruptcy. Lux. April 1st

1977, 23, 556.

29 ° See sub art. 444, no.26.

30 ° Any judicial mortgage resulting from a judicial decision rendered during the period

suspicious. Court March 14, 1988, 27, 231.

31 ° If, as a general rule, the resolution of a sale that took place during the suspicious period prior to the declaration of

bankruptcy, entails the extinction of the reciprocal obligations of the parties, and therefore does not constitute one of the deemed acts

null and without effect in relation to the mass by article 445 of the Commercial Code, the trial judges may nevertheless

find out what the real wishes of the parties were at the time of this resolution and examine whether, due to the specific circumstances of

cause, this resolution was not in reality, at the time it took place, one of the acts referred to in said article 445. Cass.

July 8, 1993, 29, 222.

32 ° By stipulating a single accounts clause, the parties agree that the client’s various accounts constitute, in

fact and in law, the elements of a single, indivisible account, allowing the compensation of balances as is happening

for the current account. The balance of the account statement is opposable to third parties like the balance of a current account and as such

it is also opposable to the mass of creditors unless it is established that the fact of placing their relations

contractual within the framework of a global compensation does not proceed from a clearly fraudulent arrangement.

For this to be the case, however, the common will of the parties to enter into a convention which must

present the characteristics of a current account is indisputable. The banker and his client must respect the logic of their

agreement. This is not the case of a banker who, in his declaration of claim, does not refer to the debit balance of the alleged

single account, but declares as a receivable the sum of the overdrafts of the various accounts receivable. Court March 17, 1999,

31, 129.

37

Art. 446. All other payments made by the debtor for debts due, and all other acts in respect of

onerous by him after the cessation of his payments and before the declaratory judgment, may

be canceled, if, on the part of those who have received from the debtor or who have dealt with him, they have taken place with

knowledge of the suspension of payment.

1 ° Knowledge of insolvency is not to be confused with knowledge of insolvency. Lux. July 2, 1902,

6, 283.

2 ° The offer of proof tending to establish knowledge of the suspension of payment is not relevant when it is designed

in terms so vague that it would be impossible to combat it by evidence to the contrary; the proof must relate to a

articulation of detailed facts, of which the third party, against whom the nullity is pursued, must have been aware. Lux. July 2, 1902, 6,

283.

3 ° The life insurance contract containing the attribution of benefits to specific persons constitutes a stipulation

for others joined to a stipulation for oneself, as provided for in article 1221 of the Civil Code; the agreement reached

subsequently and by which the insured, with the consent of the insurer, confers the benefit of the insurance on one of his

creditors up to the amount of its debt, does not constitute collateral, but a simple amending rider which

retains the essential character of an insurance contract to the agreement and only makes changes to this contract with regard to the

person of the beneficiary; the acceptance that the new beneficiary intervening in the amendment makes of the stipulation made for him, him

definitively and irrevocably grants the benefit of the insurance, which has never been able to constitute a marketable security which has remained,

or even entry into the assets of the insured and which could never, therefore, belong to the creditors of the latter, fallen

since in a state of bankruptcy; it follows that the act of termination of the insurance contract entered into between the interested parties after

at the time of the cessation of payments, could not modify the assets of the bankrupt insured, while no value was issued from this asset of the

head of said insurance contract; and even admitting that the intervention of the insured on termination would constitute a waiver of

a faculty, it could not be considered as an act falling under the application of articles 445 and 446 whereas this

option is personal to the insured; however, judges have discretionary power to overturn this act, if it

constituted an advantage granted by the bankrupt to one of his creditors who had knowledge of the cessation of payments of

his debtor; in this case, the judges must in particular examine whether the act is likely to impose a prejudice on the others

creditors, and whether it was fraud which determined the contracting parties to take the action. Lux. July 17, 1897, 4, 462.

4 ° The unconditional admission of the balance of a debt to the liabilities of the bankruptcy does not imply on the part of the curator

waiver of the right to request the cancellation of partial payments made to the creditor during the suspicious period. Court 21

November 1933, 13, 122.

5 ° In the event of the bankruptcy of a merchant within six months following the resolution of the preventive composition, the payment of

dividends paid to creditors in execution of the composition may be canceled if equality between the creditors has not been ensured.

Court November 21, 1933, 13, 122.

6 ° The bankruptcy trustee has sole capacity to pronounce the nullities provided for in articles 445 and 446 of the Code of

trade; these nullities once pronounced, their effects cannot however be restricted exclusively to the mass, but

they can also benefit certain creditors ut singuli; especially, when the bankrupt had pledged objects

belonging to a third party and this pledge has been canceled under Article 445, the third party owner may claim them against the

bankruptcy mass. Lux. May 28, 1925, 11, 206.

7 ° To succeed in a request for cancellation of a payment based on article 446 of the Commercial Code, it

is up to the curator to unequivocally prove knowledge of the state of insolvency on the part of the creditor

of the bankrupt.

This knowledge does not necessarily result from the mere fact that the creditor has assigned his debtor in bankruptcy, so

that such a summons is often only a means of pressure to obtain payment.

It is therefore required that other facts corroborate more precisely the knowledge of the cessation of

payments. Court January 25, 1978, 24, 158.

8 ° See sub art. 445, no.7.

Art. 447. Validly acquired mortgage and lien rights may be registered until

day of the declaration of bankruptcy.

Nevertheless, the entries taken in the ten days preceding the time of the cessation of

payment or subsequently may be declared void, if more than fifteen days have elapsed between

the date of the constituting act of the mortgage or lien and the date of registration.

1 ° The provision which declares null any hypothec constituted in the ten days preceding the time of the termination of

payment, must be applied even though the constitution was made for a debt of which the creditor was previously only the

surety for the bankrupt, when he ascertains from the cause that there has been no novation and constitution of a new debt. Lux. June 22, 1881, 2, 71.

2 ° In matters of contractor’s privilege, the report drawn up after the start of the work and noting the state of

places on the day of its writing is valid, if not to ensure the exercise of the privilege relating to the work already done, at least in this respect.

which concerns the work that will be done in the future, provided that it makes it possible to recognize and distinguish the surplus value in

resulting; in bankruptcy matters, the entry of the first official report, taken during the suspect period, is

can only be canceled under article 447, paragraph 2; this annulment is not imposed on the court, unless it results

the circumstances of the cause that the registration was delayed with fraudulent intent; Article 447, paragraph 2 is

inapplicable to the entry of the second official report, taken after the declaration of bankruptcy; bankruptcy in fact has

influence only on the right of preference and on the rank of the creditor and the rank being determined by the date of registration of the

38

first report, that of the second is not intended to give the manufacturer a rank that did not yet belong to him,

but only to keep for him what he had already acquired. Lux. June 19, 1901, 5, 507.

3 ° There is no need to cancel the registration made after the debtor has ceased to pay a judicial mortgage whose

title is more than fifteen days old, if the late delivery of the judgment has prevented the creditor from observing the time limit

indicated in section 447 and that he was not negligent. Lux. December 15, 1934, 13, 504.

4 ° Any judicial mortgage resulting from a judicial decision rendered during the period

suspicious. Court March 14, 1988, 27, 231.

Art. 448. All acts or payments made in fraud of creditors are void, regardless of the date

which they took place.

The deed containing the sale of his furniture by a bankrupt, made after the time at which the suspension of payments was reported,

is to be considered as made in fraud of the rights of the creditors; even though this sale would only be made under the condition

suspension of full payment of the purchase price, if it results from other circumstances that the parties intended to

frustrate creditors. Court May 9, 1890, 4, 136.

Art. 449. In the event that bills of exchange have been paid after the time fixed as

being that of the cessation of payment and before the declaratory judgment of the bankruptcy, the action in relation

can only be brought against the party on whose behalf the bill of exchange has been provided; if he

This is a promissory note, the action can only be exercised against the first endorser.

In either case, proof that the person requested to report was aware of the

suspension of payment at the time of issuance of the security, must be provided.

Art. 450. The declaratory judgment of bankruptcy renders payable, with regard to the bankrupt, the passive debts not

overdue: if the bankrupt is the maker of a promissory note, the acceptor of a bill of exchange, or the drawer of

failure to accept, the other obligees will be required to give security for payment on the due date,

if they don’t prefer to pay immediately.

However, unmatured and non-interest bearing debts, the term of which would be more than one

year, will only be admitted to liabilities after deduction of the legal interest calculated since the judgment

declarative until maturity.

In the event of immediate payment by one of the co-obligees of a promissory note or bill of exchange

not due and not bearing interest, it will be made with deduction of the legal interest for the remaining time

until the expiration of the term.

Art. 451. From the declaration of bankruptcy, the interest rate on any debt not

guaranteed by a privilege, by a pledge or by a mortgage, is arrested with regard to the mass

only.

Interest on secured debts can only be claimed on amounts from

property assigned to lien, pledge or mortgage.

Article 451 of the Bankruptcy Law, far from making a virtual modification to Article 1254 of the Civil Code, intends, at

contrary, with regard to interest, leave privileged and mortgage debts under the rule of common law and maintain their

with regard to the ordinary rules of imputation; as a result, the preferred or mortgage creditor who receives only one payment

partial in the mortgage mass of the bankruptcy, is authorized to set off this payment preferably on the accrued interest even

after the declaration of bankruptcy, and to compete for the remainder of its claim in the unsecured mass. Cass. March 27

1896, 4, 123.

Art. 452. From the same judgment, any movable or immovable action, any means of execution

on furniture or buildings can only be followed, instituted or exercised against

bankruptcy trustees.

However, the court cannot receive the intervening bankrupt.

1 ° From the declaration of bankruptcy until the closing, no legal action can be validly brought

against the bankrupt alone, as to the assets affected by the divestiture. The voluntary intervention of the curator does not cover the nullity of

the procedure. Lux. January 12, 1935, 14, 27.

39

2 ° Since the appeal against a declaratory judgment of bankruptcy calls into question the existence of the bankruptcy, which is

indivisible and cannot be reported with regard to certain creditors and maintained with regard to others, and that it concerns all

creditors, it requires the questioning of the curator, the sole representative of the mass. Lux. March 18, 1916, 10, 216.

3 ° The original defendant, or, in the process of appeal, the respondent, may request the expiry of the proceedings, if the proceedings have been

discontinued for more than three years without a valid act having been made to cover the expiration.

The bankruptcy of the original plaintiff or, in the process of appeal, of the appellant which arose after the introduction of the

application or during the appeal proceedings created by the bankrupt’s appeal, does not in any way modify the legal or procedural situation

in the lapsed instance, while the lapsed request directed against a merchant who fell into bankruptcy after

having created the body himself by his request or by his appeal, far from being contrary to the provisions of article 452 of the

trade, is only a means of the original defendant or the respondent, defendant in appeal, to get rid of a

a procedure that he can consider abandoned by his opponent who has remained inactive for a certain time.

It follows that the applicant for expiry of proceedings is not obliged either to direct the application against the curator of the

applicant or appellant who fell into bankruptcy during the proceedings, either to put the curator in intervention, or to proceed to a

resumption of proceedings against the curator or to wait for a resumption of proceedings by the curator.

The bankruptcy of the original plaintiff or the appellant, which occurred during the proceedings, does not give rise to a

increase in the normal time limit for the expiry of proceedings, whether or not there has been a resumption of proceedings by or against the

curator, while, on the other hand, an increase in the normal period of expiry is only permitted in cases expressly

referred to in article 397, paragraph 2, of the Code of Civil Procedure, the provisions of which are to be interpreted restrictively and that, other

On the other hand, articles 344, 345 and 400 of the same code do not provide for the case of bankruptcy. Court May 17, 1966, 20, 127.

4 ° The cantonment has the effect of allocating the sums deposited exclusively to the payment of the seizing creditor who

no longer has to fear the co-operation of subsequent garnishees or the occurrence of the bankruptcy of the garnishee, even if it is prior to

judgment of validity. Court December 23, 1992, 29, 43.

5 ° Within the meaning of article 452 of the Commercial Code, unsecured creditors and those enjoying a general privilege shall not

are not admissible, during the bankruptcy, to summon the bankrupt or even the curator to request their conviction, but cannot

act only by means of the declaration of claim or the action for admission to have their claim recognized. Cass. 13

November 1997, 30, 265.

6 ° See sub art. 444, no.27.

Art. 453. The declaratory judgment of the bankruptcy stops the exercise of constraint by body on the

person of the bankrupt, as well as any seizure at the request of unsecured and non-privileged creditors

on furniture and buildings.

If, prior to this judgment, the day of the forced sale of the furniture or buildings has already been

fixed and published by posters, this sale will take place on behalf of the masses.

However, if the interest of the mass so requires, the court may, at the request of the curators,

allow the sale to be postponed to another time.

Art. 454. All means of execution, to achieve the payment of privileged claims on the

furniture depending on the bankruptcy, will be suspended until the end of the verification report

receivables, without prejudice to any precautionary measure and the right that would be acquired from the owner

rented premises to repossess it.

In the latter case, the suspension of the means of execution established in this article will cease fully.

right in favor of the owner.

The surety cannot ask for the discussion of the principal debtor who is in a state of bankruptcy, the bankruptcy not involving any

enforcement action by a creditor who does not have special guarantees; it does not matter that the benefit of

discussion results from the law or arises from an agreement; except for exceptions resulting from the contract, the benefit of discussion

conventional is governed by the same rules as the benefit of legal discussion. Court July 5, 1889, 3, 506.

40

Chapter III. – Administration and liquidation of bankruptcy

Section I. – General provisions

Art. 455. The Government may, with the assent of the Superior Court of Justice, institute

liquidators sworn in before the courts where the number and importance of bankruptcies so require.

Art. 456. In the districts where sworn liquidators are established, the curators with

bankruptcies will be chosen from among them, unless, due to estrangement, kinship, interests

opposites or other grounds of legitimate suspicion, the proper administration of the bankruptcy does not require another

choice.

In the absence of sworn liquidators, and in the event that, in accordance with the previous paragraph,

the district court sitting in commercial matters will believe it has to make another choice,

curators will be appointed from among the people who offer the most guarantees for intelligence and

loyalty of their management.

These curators will have the same rights, the same attributions, and will be subject to the same

supervision and the same obligations as if they had been chosen from among the sworn liquidators.

Art. 457. The King Grand Duke fixes the number of sworn liquidators, on the opinion of the Court

superior of justice and the district court sitting in commercial matters, according to the

service needs.

They are appointed by the King Grand Duke on two double lists presented by the same bodies.

Art. 458. Sworn liquidators are appointed for five years and retain, in all

case, this quality until the swearing in of their successors. They can be appointed from

new.

The sworn liquidator who will not have continued in his functions, will nevertheless complete the

operations entrusted to him, and the liquidation of bankruptcies to which he has been appointed

curator.

Art. 459. Sworn liquidators are subject to the supervision of the district court.

sitting in commercial matters. They can be dismissed by the King Grand Duke.

Art. 460. The appointed liquidators lend, within fifteen days of their appointment, to the hearing

of the district court sitting in commercial matters, the oath of good and

faithfully perform the duties of bankruptcy trustee.

Art. 461. The fees of the curators are regulated by the district court sitting in

commercial matter, according to the nature and the importance of the bankruptcy, according to the bases which will be

established by a grand-ducal royal decree.

Art. 462. The district court sitting in commercial matters may, at all

periods, replace the bankruptcy judge-commissioner by another of its members, as well as revoke

curators or one of them, replace them with others or increase their number.

The curators whose revocation will be requested will be called beforehand and heard in

council chamber. The judgment will be pronounced at the hearing.

The bankruptcy judge-commissioners are appointed and replaced by the commercial court, without distinguishing whether it is a

permanent or temporary replacement, or depending on whether the purpose of this replacement is all the functions conferred on the judge commissioner,

or only one of the acts included in the exercise of these functions; the meeting of creditors chaired by a

judge who has not received a mandate for this purpose by the commercial court, is irregularly constituted, which entails the nullity of

all that has been done and decided. Court July 12, 1895, 4, 35.

Art. 463. The judge-commissioner is specially responsible for speeding up and supervising operations,

bankruptcy management and liquidation; he will, at the hearing, make a report of all the disputes that he

will be able to give birth; he will order the urgent measures necessary for the safety and conservation of

property of the mass, and he will preside over the meetings of the bankrupt’s creditors.

The orders of the judge-commissioner are enforceable by provision. The remedies against these

orders will be brought before the district court sitting in commercial matters.

Art. 464. The State Prosecutor may attend all bankruptcy operations, take inspection

the books and papers of the bankrupt, verify his situation and be given by the trustees all the

information he deems useful.

Art. 465. Any judgment rendered in bankruptcy matters is enforceable by provision; the ordinary delay

to appeal is only fifteen days from the date of service.

Will not be subject to opposition, appeal or civil request:

1 ° judgments relating to the appointment or replacement of the judge-commissioner, to the appointment

or the dismissal of the curators;

2 ° (L. July 21, 1992) the judgments ruling on the requests for relief for the bankrupt and his

family;

3 ° the judgments authorizing the sale of the effects or goods belonging to the bankruptcy, or,

in accordance with Article 453, paragraph 3, the surrender of the sale of seized objects;

4 ° the judgments which will suspend the concordat;

5 ° judgments ruling on appeals against the orders of the judge-commissioner

rendered within the limits of its powers.

1 ° The interested party who has confessed to the cessation of his payments may appeal against the decision which does not declare it in

state of bankruptcy. Court March 6, 1903, 4, 238.

2 ° When the trustees of a bankruptcy pronounced by default have appeared in the opposition proceedings, they must be recognized as the

right to appeal against the judgment which terminated it, by reversing the bankruptcy. Court March 6, 1903, 4, 238.

3 ° As the right of appeal belongs only to those who were party in first instance, the appeal provided for in article 465

is only available to those who have been a party to the judgment; people who have not been a party have the third opposition,

under article 473. Court November 12, 1886, 2, 424.

4 ° The bankrupt has the right of appeal whenever he has been a party; he is not a party if the bankruptcy is declared

ex officio or at the request of creditors and outside the legal presence of the bankrupt; in this case it only has the

the opposition instituted by article 473; the bankrupt cannot be considered to have become a party because of the

circumstance that he presented a request for a preventive composition. Court June 5, 1908, 8, 150.

5 ° The declaratory judgment of the bankruptcy ruling on an indivisible matter, the creditors intervening in first instance have

the right to intervene in appeal proceedings. Court December 30, 1896, 4, 225.

6 ° Creditors who were not a party in first instance have the right to intervene before the Court on the directed appeal

against the declaratory judgment of the bankruptcy of their debtor. Court December 30, 1896, 4, 225.

7 ° When by the same judgment the court refused to follow up on the request for a preventive concordat and

declared bankruptcy of the debtor, the appeal against the latter decision, in accordance with Article 465, at the same time puts in

question the decision which rejected the preventive concordat, and refers its assessment to the Court. Court December 30, 1896, 4, 225.

8 ° The appeal against a judgment refusing both to approve the preventive composition and declaring bankruptcy and made in

the forms and within the time limit prescribed by article 21 of the law of April 14, 1886, regularly appeals to the appeal judge, no

only the provision denying probate, but also the one declaring bankruptcy. Court July 14, 1905, 7, 343.

9 ° When, on appeal from a judgment refusing to follow up on a request for a preventive composition and declaring the

bankruptcy of the debtor, the Court reforms and declares the reported bankruptcy, the costs of the proceedings, except those occasioned by the intervention of

creditors, must remain at the expense of the appellant debtor. Court December 30, 1896, 4, 225.

10 ° If, in general theory, the time limit for appeal runs from the service of the judgment, this rule receives, by force of

things, exception in cases where the judgment must not be served; especially, when a creditor requests by way of

petition for the bankruptcy of his debtor, without calling the latter into question, the time limit for appealing against the judgment rejecting the request

short, for the plaintiff, from the pronunciation of the judgment. Court August 13, 1887, 3, 165.

11 ° The ordinary period of fifteen days for lodging an appeal against judgments rendered in bankruptcy matters may be

increase due to distances. Court August 10, 1870, 1, 212.

12 ° This period of two weeks is not liable to increase because of the distances. Court January 31, 1896, 4, 62.

13 ° With regard to the declaration of bankruptcy, the right of appeal belongs only to those who were parties first

instance.

It follows that a bankrupt who was not a party to the declaratory judgment of bankruptcy can only challenge that judgment by way of

the opposition. Cass. February 1, 1951, 15, 102.

14 ° While it is true that article 465 of the Commercial Code provides for an appeal from a judgment rendered in bankruptcy matters

special fifteen days running from the service, it is however admitted that this exceptional provision does not find

application only when the decision has been taken on the actions which arose out of the bankruptcy, that is to say those which, without the

bankruptcy, could not have arisen, whether they were born out of the state of bankruptcy, or whether they found their source, their principle or

their basis in bankruptcy legislation, or that they relate directly to the procedure which is the consequence of the

bankruptcy.

Actions which by their object escape the causes of bankruptcy which are foreign to it and even prior to date are

subject, as regards the time limits for appeal, to the rules of common law provided for in article 443 of the Code of Civil Procedure.

This is especially the case with the demand for payment made by the bankrupt against a debtor before the declaration of

bankruptcy and subsequently taken over by the bankruptcy trustee. Court July 12, 1965, 20, 30.

15 ° In order to hasten the resolution of disputes concerning bankruptcy, article 465 of the Commercial Code provides that all

judgment rendered in bankruptcy is enforceable by provision and that the ordinary time limit for filing an appeal is only

fifteen days from the service.

This period of two weeks cannot be increased either because of the distance or because of foreignness. Court December 16, 1964,

19, 541.

16 ° If, in principle, the time limit for appeal does not begin to run until the notification of the judicial decision, this rule

must receive exception in case of rejection of the request for declaration of bankruptcy, when it is not certain that the debtor assigned

is aware of the procedure followed against him and that therefore he could not make such service. In this case, the

time limit for appeal starts from the pronouncement of the judgment rejecting the request. Court June 8, 1970, 21, 510.

17 ° It results from the text of article 465 of the Commercial Code and the parliamentary discussions which preceded in Belgium

the adoption of this article, that the legislator simply wanted to reduce the time limit for appealing from judgments rendered in matters of

bankruptcy, but that he did not touch the method of calculating the time limit which consists in excluding the dies a quo and the dies ad quem, according to

the general rule set out in article 1033 of the Code of Civil Procedure. Court January 3, 1979, 24, 275.

18 ° The end of inadmissibility based on the lateness of an appeal is not a simple nullity of a procedural act or exploit for

technical defect, but constitutes an absolute forfeiture; being foreign to article 173 of the Code of Civil Procedure, it is not

covered neither by the constitution of solicitor, nor by a subsequent procedural document and must be replaced ex officio by the court. Court

Jan 21, 1981, 25, 465.

19 ° The provision according to which the time limit for filing an appeal against a judgment rendered in bankruptcy is only

fifteen days from the service, must apply whenever the dispute could not have occurred without the advent

of bankruptcy. Court April 24, 1985, 26, 345.

20 ° The time limit for appealing judgments rendered in bankruptcy matters is of public order and cannot be increased because of the

distances, even in favor of persons domiciled abroad. Court April 24, 1985, 26, 345.

21 ° The fifteen-day appeal period provided for in article 465 of the Commercial Code only applies when the judgment

he has ruled on an action which arose out of bankruptcy, therefore on an action which could not have been brought without the bankruptcy. The

being of restrictive interpretation, it does not apply to a judgment which rules, even partially, on a

dispute based on an independent cause of bankruptcy. Court November 19, 2003, 32, 430.

22 ° The fact that the judgment pronouncing the dissolution and ordering the liquidation of a commercial company on

basis of article 203 of the amended law of August 10, 1915 on commercial companies declared applicable the provisions

legal regulations relating to the liquidation of bankruptcy only concern the actual management of the liquidation without having any influence

on remedies, which remain subject to common law. Court February 15, 2006, 33, 204.

Section II. – Formalities relating to the declaration of bankruptcy and the first

provisions regarding the person and property of the bankrupt

Art. 466. By the judgment declaring bankruptcy, the district court sitting in matters

commercial will appoint a judge-commissioner and will order the affixing of the seals. It will designate one or

several trustees, depending on the size of the bankruptcy. He will order the bankrupt’s creditors to pay the

records the declaration of their claims within a period which may not exceed twenty days from the

declarative judgment, and it will indicate the journals in which this judgment and the one that can fix

subsequently the time of the suspension of payment will be published, in accordance with Article 472.

The same judgment will designate the days and hours to which it will be carried out, at the courthouse, at the

closing of the minutes of the verification of the debts and the debates on the disputes to arise from

this verification. These days will be fixed so that at least five days and twenty days elapse.

at most between the expiry of the period granted for the declaration of debts and the closing of the minutes

verification, and a similar interval between this closure and the debates on the challenges.

Paragraph 3 repealed (L. March 29, 1979)

In the current state of Luxembourg law, the mandate of bankruptcy trustee is not incompatible with the

functions of member of the judiciary, especially with that of deputy registrar, the law of February 18, 1885, which

today this matter, decreeing no incompatibility of this kind; even assuming that there is an incompatibility between the

function of the judicial order and the functions of bankruptcy trustee, this incompatibility would have no other effects than

to expose the offender to disciplinary penalties and would have no influence on the nature and legal consequences of the

acts taken by him as curator; it would not be an incapacity, but only an incompatibility. Cass. July 31, 1908,

8, 155.

Art. 467. Repealed (L. July 21, 1992)

Art. 468. (L. March 29, 1979) If the court considers that the asset can be inventoried in a single day, it

will order that in the presence of the commissioner or a clerk delegated by him, he will immediately be

carried out the inventory, without the prior affixing of the seals.

Art. 469. (L. March 29, 1979) The clerk of the district court sitting in matters

commercial will immediately send the State Prosecutor and the trustees a notice of the provisions of the

judgment which will have ordered the affixing of the seals, the deposit or the custody of the person of the bankrupt and

appointed the said curators.

The seals will be affixed by a clerk delegated by the judge-commissioner.

The president of the district court sitting in commercial matters may, even before

judgment, order the affixing of the seals by a clerk delegated by him, either ex officio or on the

requisition of one or more creditors, but only in the event of the debtor’s disappearance or

misappropriation of all or part of its assets.

Art. 470. The appointed curators will take office immediately after the judgment

declarative; if they have not been chosen from among the sworn liquidators, they will lend beforehand,

before the judge-commissioner, the oath of good and faithfully perform the functions that are theirs

entrusted; they will manage the bankruptcy like a good father, under the supervision of the judge-commissioner, and,

if necessary, they will immediately require the affixing of the seals.

Seals will be affixed to stores, counters, cash registers, wallets, books, papers,

furniture and effects of the bankrupt.

In the event of the bankruptcy of a general or limited partnership, the seals will be affixed not

only in the main office of the company, but also in the domicile of each of the partners

solidarity.

(L. March 29, 1979) In all cases, the clerk will give, without delay, notice of the affixing of the seals.

made by him, to the president of the district court sitting in commercial matters and to the curator

appointed in bankruptcy.

Art. 471. The following will not be placed under seals, or will be extracted and handed over to the curators:

1 ° (L. March 29, 1979) the books of the bankrupt, after having been stopped by the deputy clerk, who will note

by his report the state in which they are found;

2 ° portfolio bills with a short maturity or likely to be accepted, or for which it is

Conservatory acts will have to be made: the slip will be given to the judge-commissioner;

3 ° objects subject to imminent decline or imminent depreciation;

4 ° objects used for the operation of the business in the case provided for in article 475;

5 ° the objects included in the statement mentioned in article 476.

(L. March 29, 1979) The objects mentioned in this article will immediately be inventoried by the

curators in the presence of the registrar delegated by the judge-commissioner who will sign the minutes.

Art. 472. The declaratory judgment of the bankruptcy and the one which will have subsequently fixed the cessation of

payment will, at the behest of the curators and within three days of their date, be posted in

the audience of the district court sitting in commercial matters, where they will remain exposed

During three months. They will be, also within three days, inserted by extracts in the newspapers which

are printed in the places or in the cities closest to the places where the bankrupt has his domicile or

commercial establishments, and which will have been designated by the district court sitting

in commercial matters.

This insertion will be justified by the sheets containing the said extracts, with the signature of

the printer legalized by the burgomaster.

Art. 473. The judgment declaring the bankruptcy and the one which will have fixed the time of the cessation of

payment will be subject to opposition from interested parties who have not been parties to it.

The opposition will only be admissible if it is filed by the bankrupt within a week, and by any other

interested party in the fortnight of the insertion of these judgments in that of the newspapers mentioned

in article 472 which is printed in the place closest to their domicile.

1 ° Among the interested parties covered by article 473, it is necessary to include mainly the creditors of the bankrupt; the remedy

in question is not an opposition proper, but has the character of the third-opposition, based on interests

who would be harmed by the declaratory judgment. Court December 30, 1896, 4, 225.

2 ° If it seems rational to require, on pain of inadmissibility, that the opposition raised by the creditors of a bankrupt against a

judgment declaring bankruptcy is notified, not only to the receivers, but also to the bankrupt, it does not follow that the

cause of the bankrupt cannot be validly realized after the expiry of the period of two weeks referred to in article 473; the declaration of

bankruptcy being an indivisible thing, the opponent is relieved, by the effect of the regular opposition formed against one of the co-litigants, from the

forfeiture that he had incurred of the right to file an opposition against the other, on the condition of bringing the latter into question

later before the judgment ruling on the opposition. Lux. December 6, 1902; conf. Court March 6, 1903, 6, 238.

3 ° The period of eight days of article 473 of the Commercial Code regulating the opposition to the declaratory judgment of bankruptcy is neither

straightforward nor susceptible to increase due to distances. Cass. February 1, 1951, 15, 102; Court January 5, 1949, 14, 458.

4 ° The declaratory judgment of bankruptcy may be opposed by any interested party.

Among the interested parties, it is necessary to include mainly the creditors of the bankrupt, who, however, must indicate the interest which they

have to intervene.

This interest must be real; it may consist in preventing the cancellation of mortgages granted before judgment. Lux. 20

April 1905, 15, 36.

5 ° Article 473 of the Commercial Code, regulating the opposition to the declaratory judgment of bankruptcy, derogates from common law in this

meaning that it grants the right of opposition only to interested parties who were not parties to the judgment.

Consequently, the way of opposition is prohibited to the bankrupt who, having been assigned in declaration of bankruptcy by a creditor,

was therefore a party to the trial, although he did not appear. Lux. March 11, 1933, 13, 57.

See case law sub art. 465.

6 ° The declaratory judgment of bankruptcy cannot be initiated by the bankrupt by way of appeal, but only by that of

opposition, when the bankruptcy has been declared ex officio and outside the legal presence of the bankrupt, the right of appeal not belonging,

in this matter, only to those who were party to the first instance.

This is so, even if the appeal is made by a bankrupt who, having had the right of opposition, has not exercised it regularly in

useful time. Court Jan. 15, 1964, 19, 270.

7 ° A trader who, having been sued in bankruptcy, has not appeared before the commercial court, may object to the

declaratory judgment of bankruptcy rendered by default against him. Lux. November 23, 1967, 21, 99; Lux. February 18, 1970, 21, 393.

8 ° Declarations declaring bankruptcy are subject to opposition by any interested party.

Among the stakeholders we must include the shareholders of a company declared bankrupt.

When there is a marked confusion of activity and assets between two companies and one of these companies has been

declared bankrupt, the court is entitled to pronounce the extension of the bankruptcy with regard to the other company. Lux. February 18, 1970, 21,

393.

Art. 474. If a debtor, by confessing his bankruptcy, has declared that his assets are more than sufficient

to pay all his debts, and if he has requested a stay, the district court sitting in

commercial matters, without stopping the progress of bankruptcy, may order the immediate verification of

the state of its affairs by one or more experts; and if, according to the result of this verification, it

recognizes that the debtor’s assets actually exceed his liabilities, he will order the immediate summons

creditors, and it will be proceeded as described in Title IV.

Art. 475. In the case provided for in the preceding article, and in all cases, if the bankrupt has requested a

composition and if the interest of the creditors so requires, the court, on the report of the judge-commissioner, and after

having heard the trustees, may order that the bankrupt’s business operations will be

provisionally continued by them or by a third party under their supervision. The court, on the report

judge, and after hearing the curators, may always modify or revoke this

measured.

Art. 476. The curators may, with the authorization of the receiver, deliver to the bankrupt and his

family, clothing, clothes, linens, furniture and effects necessary for their own use. The

curators will write a statement of these objects.

The bankrupt may, moreover, obtain for himself and his family food aid, which will be fixed by

the court, on the proposal of the curators and the report of the judge-commissioner.

Art. 477. The curators may, with the authorization of the judge-commissioner, immediately sell the

objects subject to impending decay or imminent depreciation.

The other objects can only be sold, before the rejection of the composition, by virtue of the authorization

of the court, which, on the report of the judge-commissioner, and the bankrupt heard or duly summoned, will determine

the mode and conditions of the sale.

Art. 478. Letters addressed to the bankrupt will be delivered to the curators, who will open them; if the bankrupt is

present, he will attend their opening.

Art. 479. The curators will seek and collect, on their receipts, all debts or

amounts owed to the bankrupt. Money from sales and collections made by curators

will, under the deduction of the sums arbitrated by the judge-commissioner, paid to the fund of

consignments within eight days of receipt. In the event of delay, the curators will owe the interest

commercial sums that they have not paid, without prejudice to the application of Articles 459 and

462.

Art. 480. The sums paid into the consignment fund on behalf of the bankruptcy

may be withdrawn only on mandates of the curators referred to by the judge-commissioner. The delivery will be

made without other formalities, on these money orders, which may be issued for the benefit or to the order of

bankruptcy creditors.

Art. 481. Repealed (L. July 21, 1992)

Art. 482. A bankrupt may not be absent without the authorization of the receiver. He will be required to

return to all invitations made to him, either by the judge-commissioner, or by the

curators.

Paragraph 2. Repealed (L. July 21, 1992)

The bankrupt may appear by proxy, if he can justify recognized causes of impediment

valid by the judge-commissioner.

Art. 483. The curators will call the bankrupt to them to close and stop the books and records.

in his presence.

Art. 484. The curators will immediately verify and rectify the balance sheet. If he

has not been filed, they will prepare it, using the bankrupt’s books and papers and the information they

will be able to obtain it, and they will file it at the clerk of the district court dealing with

commercial.

Art. 485. The bankruptcy judge is authorized to hear the bankrupt, his clerks and employees and any

other person, both on what concerns the verification or formation of the balance sheet, as well as on the causes and

circumstances of bankruptcy.

Art. 486. When a merchant has been declared bankrupt after his death, or when the bankrupt

will die after the confession of his bankruptcy, his widow, his children or his heirs may be

present or be represented to replace him in the formation of the balance sheet, as well as in all

bankruptcy operations.

Art. 487. From the date of their taking up their duties, the curators will be required, under their responsibility

personal, to perform all acts for the preservation of the rights of the bankrupt against his debtors.

They will also be required to request the registration of mortgages on the buildings of the debtors of the

bankrupt, if it was not requested by him; the registration will be taken in the name of the mass by the curators, who

will attach to their slip a certificate from the clerk noting their appointment.

They will also be required to register in the name of the body of creditors, on the

buildings of the bankrupt of which they will know the existence. The registration will be received on a simple slip

stating that there is bankruptcy and relating the date of the judgment by which they were appointed.

(L. July 21, 1992) They are also required to register, in the name of the employees,

privileges granted to them for the payment of salaries and compensation for non-observance of the

notice period or by reason of the abusive termination of the contract.

Art. 488. Within three days of taking up their duties, the curators shall request, if necessary, the

lifting of the seals, and will proceed with an inventory of the bankrupt’s property, who will be present or duly

called.

The curators may, with the authorization of the judge-commissioner, get help for its drafting

as for the estimation of objects, by which they will deem suitable.

Art. 489. (L. March 29, 1979) The inventory will be drawn up by the curators as the seals

will be lifted; the clerk delegated by the judge-commissioner will attend and will sign it at each session: the

minute will be filed, within twenty-four hours of its final closure, at the registry, where the curators

will be able to take a copy without charge and without travel.

Objects which, in accordance with article 471, have not been placed under the

sealed or which have been extracted and inventoried.

Art. 490. In the event of a declaration of bankruptcy after death, when no inventory has been made

prior to this declaration, or in the event of the death of the bankrupt before the opening of the inventory, there is

will be proceeded immediately in the forms of the preceding article, in the presence of the heirs or them

duly called.

Art. 491. The completed inventory, merchandise, money, papers, active titles, movables and

The debtor’s effects will be handed over to the curators, who will take care of them at the foot of the said inventory.

Art. 492. The curators may, with the authorization of the bankruptcy judge, and the duly summoned bankrupt,

compromise on all disputes that interest the masses, even those relating to

shares and real estate rights.

When the transaction will relate to real estate rights, or when its object will be of a value

indefinite or which exceeds 7.44 euros, the transaction will only be binding after having been

approved, on the report of the judge-commissioner. If the dispute on which it will have been settled was

under the jurisdiction of the civil court, the transaction will be approved by this court.

The bankrupt will be called for probate; in all cases, he will have the right to oppose it. His

opposition will suffice to prevent the transaction, if it relates to real estate.

The curators may also, with the authorization of the district court sitting in matters

commercial, the duly called bankrupt, defer the litis-decisive oath to the opposing party, in the

disputes in which bankruptcy will be initiated.

Art. 493. The curators may employ the bankrupt to facilitate and enlighten their management. The judge commissioner

will set the conditions of his work.

Art. 494. In any bankruptcy, the curators, within two weeks of taking up their duties, will be required to

to submit to the bankruptcy judge a memorandum or summary account of the apparent state of bankruptcy,

its main causes and circumstances, and the characteristics it appears to have.

The judge-commissioner will immediately send the brief with his observations to the prosecutor

of state. If it has not been returned to him within the prescribed period, he will notify the state prosecutor, and he will

will indicate the causes of the delay.

Art. 495. (L. July 21, 1992) In case of bankruptcy of a company, can be declared personally in

bankruptcy any manager in law or in fact, apparent or hidden, remunerated or not, whether it is a

natural person or a legal person, who has:

– under the guise of society masking its actions, carries out commercial acts in a

personal interest or

– disposed of social goods as their own or

– pursued abusively, in his personal interest, a loss-making operation which could not

lead only to the cessation of payments of the legal person.

The liabilities of the bankruptcy of the manager include, in addition to the personal liabilities, that of the company.

The date of the cessation of payments is that fixed by the judgment declaring the bankruptcy of the

society.

Art. 495-1. (L. July 21, 1992) When the bankruptcy of a company reveals a lack of assets,

the court may decide, at the request of the curator, that the debts must be borne, in whole or in

party, with or without solidarity, by the social leaders, de jure or de facto apparent or occult,

remunerated or not, in respect of which serious and characterized faults have been established that have contributed

to bankruptcy.

The action lapses after three years from the final verification of the claims. In case of

resolution or annulment of the composition, prescription, suspended for the time that the

concordat, begins to run again, without however the time limit for exercising the action may be less

at one year.

Chapter IV. – Declaration and verification of debts

Art. 496. The bankrupt’s creditors are required to file at the clerk of the district court

declaring their claims with their securities in commercial matters, within the time limit set in

declaratory judgment of bankruptcy. The clerk will take note of it and give a receipt.

Creditors are notified to this effect by the publications and posters prescribed by article 472. They

will be, moreover, by a circular letter charged to the post office, which the curators will send to them immediately

that they will be known. This circular will indicate the days and hours fixed for the closing of the minutes.

verification of debts and the debates of disputes arising from this verification.

The loading slips will be and will remain annexed to the minute of the circular, which will be

referred by the judge-commissioner.

Art. 497. If there are creditors, residing or domiciled outside the Grand Duchy, in respect of whom

the time limit set by the declaratory judgment of bankruptcy would be too short, the judge-commissioner will extend it to

their respect according to the circumstances; this extension will be mentioned in the circulars

addressed to these creditors, in accordance with Article 496.

Art. 498. The declaration of each creditor will state his name, first names, profession and domicile,

the amount and causes of his claim, the privileges, mortgages or pledges assigned to it and the

title from which it results.

(L. 23 February 1977) This declaration will end with an affirmation conceived in the terms

following: “I affirm that my present claim is sincere and true”.

It will be signed by the creditor, or on his behalf by his attorney; in this case

power of attorney will be annexed to the declaration, and it must state the amount of the claim and contain

the affirmation prescribed by this article.

1 ° Except in the case of fraud, a production on the liabilities side of the bankruptcy made under a nominee is generally valid, no

legal provision not having prohibited it. Court April 6, 1900, 5, 250.

2 ° The bankruptcy rules are not applicable to the privileged claim of the Public Treasury on the property of its debtors

bankrupt; therefore the receivers of contributions are not required to declare and affirm the privileged claim belonging to

the State for the contributions owed by a bankrupt, consequently the trustee of a bankruptcy is obliged to pay the taxes owed by the bankrupt

before any distribution to creditors of the bankruptcy funds, even though the receiver has not sent him the

request. Lux. November 22, 1884, 2, 318.

3 ° The Tax Administration is entitled to demand payment of taxes from the curator even after the closing of

bankruptcy operations and in the absence of any previous request on his part; the curator, by virtue of his capacity as depositary

funds coming from the head of the bankrupt liable to the Treasury, is required, before distributing the bankruptcy funds to the creditors, to

ensure that the contributions due are paid. Lux. November 22, 1884, 2, 318.

4 ° To decide on the privileged nature of a claim produced in the liabilities of a bankruptcy declared in Luxembourg, it is necessary to

recognize the jurisdiction of the law of the country where the claim arises. The privilege which is granted by this law must therefore be

respected in Luxembourg. Court February 23, 1972, 22, 280.

Art. 499. The declaration will contain, on the part of the creditor not domiciled in the municipality where

sits the court, choice of domicile in this municipality.

In the absence of having elected domicile, all meanings and information may be given to them or

given to the court registry.

1 ° To run the time limit for appeal, service of the judgment must be made at the elected domicile and not at the actual domicile of the

producing creditors, and this in accordance with the provisions of article 499 of the law of July 2, 1870. Court of August 10, 1876, 1, 212.

2 ° The provision of article 499 of the law of 2 July 1870 as well as that of article 422 of the Code of Civil Procedure,

are not threatening in the sense that the service must be made either at the elected address or at the registry, but these

provisions leave the parties free to have their exploits served at the actual domicile of the opposing party,

in accordance with the general principle of article 68 of the Code of Civil Procedure. Court January 31, 1896, 4, 62.

49

Art. 500. The verification of debts will take place, on the part of the curators, as the

declaration will be made to the registry; it will be operated in the presence of the judge-commissioner and the intervention

of the bankrupt, or him duly called. The titles will be reconciled with the books and writings of the bankrupt.

The receivables of the curators will be verified by the judge-commissioner.

A report of the operations will be drawn up by the curators and signed at each meeting by them and

the judge-commissioner. It will indicate the domicile of the creditors and their authorized representatives. It will contain

the brief description of the titles produced, will mention any overwrites, erasures and spaces, and

will express whether the claim is admitted or contested.

In the event of a dispute or if the claim does not appear to be fully justified, the curators will adjourn

their decision until the closing of the verification report, and if, at the time of this postponement, the

creditor is not present in person or by proxy, they will immediately give

notice by letter loaded in the post.

1 ° In general and except in the case of fraud or fraud, the admission of a debt without restrictions or reservations in the minutes of

verification of debts constitutes a judicial contract which places the admitted debt, as well as the various articles of an account having

used to settle the amount of this debt, sheltered from any subsequent dispute. Lux. July 13, 1898, 5, 250.

2 ° If, in principle, the mortgage that the law confers on the woman at the rate of the commitments she has contracted for her husband,

is only enforceable against third parties when these commitments have acquired a certain date, it must be otherwise when

the existence of the debt at the time in dispute is recognized by the part which inhibits article 1328 of the Civil Code; recognised

the existence of the debt the curator who admitted the debt to the liabilities of the bankruptcy by virtue of documents recording the commitment of the

wife at the same time as that of the husband on the disputed dates. Court May 29, 1903, 6, 283.

3 ° The curator in a bankruptcy who, after having claimed from a party a claim of the bankruptcy, then admits the same party

as a creditor in bankruptcy during the verification of debts, without making reservations about her debt and without invoking the

compensation, is deemed to have recognized the basis of the claim of that party and the unfounded basis of its debt and is not

admissible to continue in the following the payment of the debt of the bankruptcy. Lux. July 25, 1907, 8, 393

4 ° The administration of bankruptcy requires the conversion of currencies into Luxembourg francs and the most widespread doctrine

teaches that the conversion must be done during the day of the debts verification. Court March 2, 1923, 11, 134.

Art. 501. After the declaration of each claim and until the day fixed for the debates on the

disputes that it raises, the judge-commissioner may, even ex officio, order the appearance

personal information of the creditor or his authorized representative or of any person who can provide

information. He will draw up a report of their statements. He may also order the representation of

his books or ask, by virtue of a compulsary review, that an extract made by the judge of the

location.

Art. 502. At the meeting fixed for the closing of the verification report, any debt

declared which will be contested or which has not yet been admitted will be examined contradictorily.

The curators will sign on the title of each of the admitted and uncontested claims the declaration

next: Admitted as a liability in the bankruptcy of … for the sum of … on …

The judge-commissioner will endorse the declaration; he will refer to court all disputes relating to

to disallowed debts. However, if there are disputes which, because of the matter, are not

under the jurisdiction of the district court sitting in commercial matters, they will be

referred to the competent judge, for the decision on the merits, and to the district court

sitting in commercial matters, to be ruled therein, in accordance with article 504, up to

of what sum the disputed creditor may take part in the deliberations of the composition.

1 ° The admission of a claim to the liabilities of a bankruptcy during the verification of claims constitutes a judicial contract which establishes

the debt protected from any dispute both in relation to its quota and in relation to its quality. This is not, however,

the case for matters which concern public order and in which the parties are forbidden to compromise. Specially, the

privilege can only exist by virtue of an express provision of the law, the admission to the privileged liabilities of a bankruptcy of a

claim which is not legally secured with a preferential right is null with regard to the privilege granted to this claim.

Court November 25, 1930, 13, 80.

2 ° The unconditional admission of the balance of a debt to the liabilities of the bankruptcy does not imply on the part of the curator

waiver of the right to request the cancellation of partial payments made to the creditor during the suspicious period. Court 21

November 1933, 13, 122.

3 ° In bankruptcy matters, the dispute concerning the existence of a special security for the recovery of contributions

due and due to the Family Allowances Service is a pure question of civil law that does not fall within the remit of

commercial jurisdiction, but in that of the civil court. Lux. February 4, 1950, 15, 132.

4 ° Subject to the merits of the dispute, the jurisdiction of the commercial court in bankruptcy matters extends to disputes

50

arising on the occasion of the request for admission of claims declared after the closure of the minutes of verification of

receivables, this assumption being provided for by article 508 of the French Commercial Code.

The admission of a claim to the liabilities of a bankruptcy, without restriction or reservation and after the expiry of the time limits for contradicting,

binds the producing creditor and the curator by an irrevocable legal contract, with reservation made only in cases of fraud, fraud or

a debt arising from a contract contrary to public order, but without this contract being able to be called into discussion under the

pretext of an error of fact or of law.

The decision of the bankruptcy judge, recorded in the minutes of the verification of the claims, protects the admitted claim from

any modification and prevents the creditor from subsequently requesting a change in the quota thus fixed.

The irrevocable nature of the judicial contract entered into between parties by admitting a debt to the liabilities of the bankruptcy

produced is based on the stability and security of bankruptcy operations, which prevents both the admitted creditor and the

curator to avoid the effects of this contract, so that a subsequent request from the creditor tending to

discussion the amount of the accepted debt is inadmissible, even though the curator formally refused to propose

means of inadmissibility, in order to obtain a decision on the merits of the dispute. Court March 9, 1966, 20, 83.

5 ° In the event of a composition by way of abandonment of assets, disputes over debts must be examined as to the substance and the

court proceeds in accordance with common bankruptcy law.

If a declaration of production of debt in a composition by abandonment of assets is only an act simply

conservatory, it is however equivalent to a legal claim, when it comes to be contested.

It follows that a municipality can validly file a claim without prior administrative authorization,

but that it must obtain this authorization from the moment the claim is contested. Lux. November 25, 1971, 22,

247.

6 ° The verification of debts in the event of bankruptcy with the aim of definitively determining the respective rights of

creditors, it follows that the pure and simple admission of a debt, whether it took place amicably or by judicial authority,

implies either a judicial contract or an equivalent decision by the effect of which this claim is henceforth immune from any

new challenge tending to annihilate, reduce or modify it.

However, the judicial contract, as well as the authority of res judicata, can only extend to the matter which has been the subject of

of the dispute. Court January 3, 1979, 24, 275.

Art. 503. The bankrupt and the creditors verified or recorded in the balance sheet may attend the verification of the

claims and provide contradictions to checks, done and to be done. After the close of the minutes

verification, contradictions to the verifications made and included in this report cannot,

penalty of nullity, be formed only by documents served on the declaring creditors, and filed with the registry

with the supporting documents two days before the hearing fixed for the debates on the challenges.

Contradictions to the verifications that would be made after the closure of the verification report

must, under the same penalty, be served within ten days of the admission of the claim

contested. However, this period will not run, with regard to creditors admitted after this

last period, only from the verification of their debts.

Art. 504. On the day fixed by the declaratory judgment for the debates on the disputes, the judge commissioner

shall make its report, and the tribunal thus seized, without waiting for the expiry of the time limits which will have

been extended under article 497, will proceed without prior summons, as a matter of urgency, all cases

ceasing, and, if it is possible, by a single judgment, to the decision of all disputes relating to

to the verification of debts. This judgment will be rendered after having heard contradictorily, if they

present, the curators, the bankrupt and the opposing and declaring creditors.

Disputes which cannot receive an immediate decision will be disjointed; those who don’t

will not be within the jurisdiction of the court will be referred to the competent judge. The court may

however, in either case, decide by provision that the disputed creditors will be admitted to the

the deliberations for the formation of the concordat, for a sum to be determined by the same

judgment. If he does not rule in this regard, the disputed creditors will not be able to take part in the

bankruptcy operations as long as no decision has been taken on the merits of the dispute.

No opposition will be received against the judgment made in execution of this article, nor against

those who will rule later on the disjointed disputes. The judgment which will pronounce a

provisional admission of disputed creditors will, moreover, be neither subject to appeal nor request.

civil.

1 ° As the liquidation of a bankruptcy declared in the Grand Duchy is entrusted to the Luxembourg courts, the judgment

of a dispute relating to the production as a liability of the bankruptcy cannot be delayed by the fact that the same dispute is

pending before a foreign court; this must be the case especially when the possible decision of the foreign court is submitted

the review of the merits of the law by the Luxembourg courts, in the event that the lawsuit is decided in favor of the creditor

producing abroad. Court April 3, 1914, 9, 118.

2 ° In the event of debates on challenges to the verification of bankruptcy claims, the report of the judge commissioner

must, on pain of nullity, precede the debates. Court March 18, 1902, 3, 193.

51

Art. 505. All disputes, concerning the liquidation of bankruptcy, which would be within the competence

civil courts, will be brought there at short notice and judged urgently. It will be the same for all

disputes of this kind which will be brought before the Superior Court of Justice.

1 ° If the commercial courts have, in general, competence to rule on disputes in matters of

bankruptcy, doctrine and jurisprudence however understand this rule of jurisdiction only with the temperament that

civil disputes, the cause and origin of which do not necessarily lie in the state of bankruptcy, remain subject to the law

common in matters of jurisdiction; hence requests for payment of rents and rental repairs come under the

civil jurisdiction after as before the declaration of bankruptcy. Lux. July 6, 1895, 6, 446; Lux. May 7, 1971, 22, 117.

2 ° The same applies to actions relating to real property rights. Lux. April 22, 1885, 3, 264.

3 ° The civil judge called upon to rule on the merit of debts produced in bankruptcy on referral from the commercial court, judges the

validity and amount of the claim without pronouncing admission to liabilities; the commercial court has sole jurisdiction over this

effect. Lux. June 19, 1901, 5, 507.

4 ° If it is the civil court which knows the validity of acts by application of articles 445 and 446, it is however the

commercial court which is competent to hear the costs of acts forming an ancillary part of the debt to be verified. Lux.

June 22, 1881, 2, 71.

5 ° The civil court is competent to decide on the existence and the character of a claim produced in the liabilities of a bankruptcy,

when this claim is of a civil nature, but the commercial court has sole jurisdiction to rule on the admission of the

claim on bankruptcy liabilities and on possible participation in dividend distributions. Lux. July 30, 1910, 10, 214.

6 ° When a civil judge rules on the existence and importance of a debt that a bankrupt contracted before falling into bankruptcy, he

can neither order the curator qualitate qua to pay this sum to the creditor nor decide on the admission of the debt to the

bankruptcy liability, but must, after determining the amount of the claim, be limited to reserving for the creditor the right to

to appeal to the competent court to require him to admit his claim to the liabilities of the bankruptcy. Court February 21, 1979,

24, 270.

Art. 506. Until the judgment to be reached on the disputes, all declarations of claims,

the supporting documents and all acts, minutes, contradictions and requests relating thereto will remain

filed with the registry and will, upon request, be communicated to the interested parties.

Art. 507. A table divided into columns and containing,

for each claim declared, the following statements:

1 ° the serial number;

2 ° the surname, first names, profession and residence of the creditor who has filed his declaration and

securities;

3 ° the date of this deposit;

4 ° the amount of the declared claim;

5 ° the summary description of the goods or objects on which it is claimed that it would be mortgaged

or privileged;

6 ° its admission to liabilities or its rejection by the curators;

7 ° the date of this admission or rejection;

8 ° contradictions;

9 ° the names of the opponents;

10 ° the dates of the contradictions;

11 ° the day on which the verification report will be closed;

12 ° the day on which the debates on the disputes will begin;

13 ° the summary of the final decision;

14 ° the date of this decision; and

(15) other information that it may be useful to bring to the attention of the interested parties.

This table will be drawn up by the clerk; the required statements will be made there successively day

daily, and as the facts and circumstances to which they relate become

will reproduce. It will be communicated to interested parties upon request.

52

Chapter V. – The Concordat

Section I. – The meeting of creditors

Art. 508. In the absence of declaration and confirmation of their claims within the time limit set by the

declaratory judgment of bankruptcy, and extended under section 497, known or unknown defaulters

will not be included in the distributions; however, they will be able to declare and assert their claims

until the last distribution of the last inclusively. Their declarations will not suspend the

orderly distributions; but if new distributions are ordered after these declarations, there

will be included for the sum which will be provisionally determined by the judge-commissioner, and which will be

held in reserve until their claims have been admitted. In all cases, the costs

to which the verification and admission of these debts will have given rise will remain their responsibility, and they

will not be able to claim anything on the distributions ordered before their declarations; but they will be entitled to

deduct from the assets not yet distributed the dividends relating to their claims in the first

distributions, if they can justify having been unable to make their declaration and assertion in the

time limit.

Art. 509. Immediately after the judgment rendered in execution of article 504, and without waiting for the

deadlines granted by virtue of article 497, the formation of the concordat will be ignored.

The judge-commissioner will order for this purpose the summons of the creditors and will fix the place, day and

time of the meeting.

The day of this meeting will be determined so that it takes place in the fortnight of the judgment.

which will have been returned in execution of article 504, and that it be left to each of the creditors, between its

convocation and the day of the meeting, a period of two days, increased by one day by five myriameters

distance between the place of his real domicile and that of the meeting.

Art. 510. The summons of creditors will take place within three days following the order of the

judge-commissioner; it will be done at the behest of the curators, by posters and publication, and by a

circular addressed individually to creditors whose claims have been admitted

definitively or by provision; the whole in the manner and in the forms prescribed by articles 472

and 496.

Art. 511. At the place, day and hour fixed by the judge-commissioner, the assembly will be formed under his

presidency. Creditors admitted definitively or by provision, or their authorized representatives, will be

only admitted.

The bankrupt will be called to this meeting; he can only be represented there for reasons

valid and approved by the judge-commissioner.

The judge-commissioner will verify the credentials of those who present themselves at the meeting as

authorized representatives. The trustees will make a report on the state of the bankruptcy, on the formalities which

will have been fulfilled and the transactions which will have taken place, and on the probable result of the liquidation. The

bankrupt will be heard. The curators’ report will be submitted, signed by them, to the judge-commissioner, who will draw up

minutes of what will have been said and decided in the assembly.

The omission, in the meeting of creditors convened with a view to the formation of the composition, of the report of the curator on

the present state and the probable outcome of the bankruptcy vitiate and annul the procedure followed. Lux. May 25, 1895; conf. Court July 12, 1895, 4,

35.

53

Section II. – The formation of the concordat

Art. 512. Except as provided for in article 520, no treaty between the

deliberating creditors and the bankrupt debtor only after completion of the above formalities

prescribed.

This treaty will be established only by the assistance of a number of creditors forming the majority, and

representing, in addition, three-quarters of all the claims admitted definitively or by

provision in accordance with Chapter IV; all on pain of nullity.

Art. 513. Registered or exempted mortgage creditors and creditors

privileged persons or pledged persons will not have a voice in the operations relating to the composition for the aforesaid

debts, and they will be counted only if they renounce their mortgages, pledges or privileges.

The vote in the concordat automatically entails this waiver; it will remain ineffective if the

Concordat is not allowed.

These creditors may however vote in the composition without waiving their privileges,

mortgages or pledges only for a portion of their claims equivalent to at least half; in this

In this case, these receivables will only be counted for this portion in transactions relating to the

concordat.

Art. 514. Any composition is prohibited if the bankrupt is in the situation provided for in article 495, or if he has

been convicted of fraudulent bankruptcy.

In the case provided for by article 495, the creditors summoned to deliberate on the composition

may, by a double majority prescribed by Article 512, stay proceedings until after the outcome of the

lawsuits. Rejection of the stay will entail rejection of the composition.

Art. 515. The concordat will, on pain of nullity, be signed immediately. If it is only consented

by a majority in number or by a majority of three quarters in total, the deliberation will be postponed to

eight days for any delay; in this case, the resolutions taken and the accessions given during the

first meeting will have no effect.

Art. 516. All creditors who have had the right to participate in the composition, or whose rights have been

recognized since, may form opposition.

The opposition will be motivated and must be served on the trustees and the bankrupt within five days of

will follow the concordat; all on pain of nullity. Within five days of this service, the

curators and the bankrupt may have their request notified in response to the opposition and file it with the registry

with the parts they will use.

Immediately after this period, without other formalities or procedure, the judge-commissioner will make his

report on the characteristics of the bankruptcy and the admissibility of the composition, and the court will rule by a single

judgment on oppositions and homologation. The parties may, however, appear or be

represent at the hearing to briefly set out the means in support of their claims.

If only one curator has been appointed and if he opposes the concordat, he must initiate the

appointment of another curator vis-à-vis whom he will be required to complete the forms prescribed in this

article.

If the judgment of the opposition is subordinate to the solution of foreign questions, because of the

matters, to the jurisdiction of the district court sitting in commercial matters, this court

adjournment until after the decision of these questions.

Art. 517. In the event of non-observance of the provisions prescribed above, or when the reasons given

either in the public interest or in the interest of the creditors, will appear likely to prevent the composition, the

court will refuse homologation. In this case, the composition will be canceled with regard to all

54

interested.

Art. 518. The homologation of the composition will make it obligatory for all creditors, whether or not brought

carried on the balance sheet, verified or unaudited, and even for the creditors mentioned in section 497, as well

that for those who, by virtue of article 504, would have been admitted by provision to deliberate, whatever

the sum that the final judgment would award them subsequently.

It will keep for each of the creditors, on the buildings of the bankrupt, the mortgage registered under

of the last paragraph of article 487. For this purpose, the curators will register in the mortgages the

homologation judgment, unless otherwise decided by the composition.

Art. 519. Immediately after the homologation judgment has become final, the

functions of the curators will cease.

The curators will give the bankrupt their final account in the presence of the judge-commissioner; this account

will be debated and stopped. The curators will hand over to the bankrupt the universality of his property, books, papers and

effects; the bankrupt will order discharge, and all minutes will be drawn up by the judge-commissioner.

In the event of a dispute, the district court sitting in commercial matters will pronounce,

on the report of the judge-commissioner.

Art. 520. Repealed (L. April 14, 1886)

Section III. – Cancellation and resolution of the composition

Art. 521. The composition will be null and void if, since its homologation, the bankrupt has been convicted

for fraudulent bankruptcy.

When, after the approval of the composition, the bankrupt will be prosecuted for fraudulent bankruptcy

or placed under a warrant of committal or arrest, or under a warrant of arrest in the event of a flight, the court

district sitting in commercial matters may, on the report of the judge-commissioner,

prescribe such protective measures as it may be. These measures will cease, as of right,

day of the declaration that there is no need to follow, of the order of acquittal or of the suspension of absolution.

Art. 522. No action for nullity of composition will be admissible after homologation except for

cause of fraud discovered since this approval, and resulting either from the concealment of the asset, or from

exaggeration of liabilities.

Nullity of the composition, either for fraud or following conviction for bankruptcy

fraudulent, operates as of right even with regard to sureties.

Art. 523. In the event of non-fulfillment by the bankrupt of the conditions of his composition, the resolution of this

treaty may be sued against him before the district court sitting in matters

commercial, in the presence of sureties if there are any, or they duly called.

The resolution of the composition will not release the sureties which will have intervened to guarantee it.

full or partial execution.

Art. 524. By the judgment which will pronounce either the annulment or the resolution of the composition, or in

the cases provided for in article 521, by a judgment rendered at the request of one or more creditors, or

even ex officio on the report of the judge-commissioner, the district court sitting in matters

Commercial will instruct the previously appointed curators to resume their functions or in

appoint new ones, and he will order the creditors of the bankrupt, subsequent to the homologation of the

composition, to declare their claims within the time limit set in article 466.

55

What is prescribed in articles 469 and 472 will be observed with regard to this judgment.

The curators may have the seals affixed. They will proceed without delay, with the assistance of the

justice of the peace or the magistrate, if he was responsible for affixing the seals to the old

inventory, to the inventory of values, shares and papers, and will, if necessary, make a supplement

inventory. They will draw up an additional balance sheet, and they will send the new creditors the

circular mentioned in article 496.

Art. 525. New claims will be declared, asserted and verified in accordance with the

provisions of Chapter IV.

There will be no new verification of receivables previously admitted to liabilities, without

prejudice, however, to the rejection or reduction of those which have since been extinguished in whole or in

part.

Art. 526. The various acts mentioned in article 445 made by the bankrupt are null and void.

after the approval judgment and prior to the annulment or resolution of the

concordat. The other acts performed during this interval by the bankrupt will only be annulled if they have been

granted to the prejudice of the execution of the composition or in fraud of the rights of creditors.

Art. 527. The creditors prior to the composition shall be fully entitled to their rights to

with regard to the bankrupt only; but they can only appear in the mass for the proportions

following, namely: if they did not receive any part of the dividend, for all of their claims; if they

received part of the dividend, for the portion of their original claims corresponding to the portion

of the promised dividend that they will not have received.

The provisions of this article are applicable in the event that a second bankruptcy will arise.

without prior cancellation or resolution of the composition.

56

Chapter VI. – From the liquidation of the bankruptcy

Art. 528. If no concordat takes place, the curators will continue to represent the mass of

creditors, and will liquidate the bankruptcy; they will sell the buildings,

goods and household effects, and will liquidate active and passive debts; all under the

supervision of the judge-commissioner, in accordance with the provisions of Articles 479 and 480, and without

that it is necessary to call the bankrupt.

They will be able to compromise, in the manner prescribed by article 492, on any kind of rights

belonging to the bankrupt, notwithstanding any opposition on his part.

The bankruptcy trustee has the legal mission of representing the body of creditors; therefore only actions which

present a common interest for all unsecured creditors may be exercised by the curator, but this

the latter has no standing to invoke a lien which may exist in favor of a few creditors and which does not benefit the

mass. Cass. November 13, 1952, 15, 403.

Art. 529. The creditors may nevertheless give a mandate, either to the curators or to a third party,

under the supervision of the curators, to continue the exploitation of the asset.

The deliberation which will confer this mandate on them will determine its duration and extent, and will set the

sums that curators may keep in their hands for the purpose of defraying costs and expenses;

it must be taken immediately after the rejection of the composition, in the presence of the judge-commissioner and

the majority in number and in sums determined by article 512.

The way of opposition will be opened against this deliberation to the bankrupt and to the dissident creditors.

This opposition will not suspend execution.

If the operations of the curators or agents give rise to commitments that exceed the assets,

only the creditors who have authorized these commitments will be personally liable for more than

their share in the assets, but only within the limits of the mandate they will have given. They will contribute

in proportion to their claims.

Art. 530. When a general partnership is bankrupt, the creditors may not consent to the

composition only in favor of one or more of the partners; in this case, all the corporate assets will remain

subject to the bankruptcy regime; the personal property of those with whom the arrangement has been

consented will be excluded, and the special treaty concluded with them may not contain the commitment of

pay a dividend only on securities foreign to the company’s assets.

The partner who will have obtained a special composition will be released from all solidarity.

Art. 531. Immediately after the rejection of the composition, the assembled creditors will be consulted

on the maintenance of food aid granted under Article 476 or on that which may be

subsequently granted to the bankrupt and his family on the bankruptcy assets. If the majority of creditors

present consents, relief will be maintained or may be granted. The curators will propose the

quota, which will be set by the judge-commissioner, except for recourse to the court, by the curators

only.

Art. 532. After the rejection or annulment of the composition, the judge-commissioner may convene the

creditors when he deems it necessary.

The assembled creditors may, by a simple majority, with the authorization of the court, the bankrupt

duly called, instruct the curators to process all or part of the rights or actions of which the

recovery would not have been operated, and to alienate them.

Art. 533. When the liquidation of the bankruptcy is completed, the creditors will be summoned by the

judge commissioner. He may order that the account of the curators be attached to this summons.

In this assembly, the account will be debated, the bankrupt present or duly called. The remainder of

57

account will form the last allocation.

In the event of a dispute, the procedure will be as stated in article 519, paragraph 3.

Paragraph 4. Repealed (L. July 21, 1992)

Art. 534. Repealed (L. July 21, 1992)

Art. 535. No merchant debtor will be admissible to apply for admission to the benefit of

assignment.

Paragraphs 2 and 3. Repealed (L. July 21, 1992)

Art. 536. If, at any time whatsoever, before the summons of the creditors to deliberate on

the composition, it is recognized that the assets are not sufficient to cover the presumed costs of administration and

liquidation of the bankruptcy, the district court sitting in commercial matters may, on the

report of the judge-commissioner, order, even ex officio, the closure of bankruptcy operations. In this

In this case, the creditors will return to the exercise of their individual actions against the person and the

property of the bankrupt.

Paragraph 2. Repealed (L. July 21, 1992)

The execution of the judgment which will have pronounced this closure will be suspended for one month.

The bankrupt or any other interested party may, at any time, have it reported by the court.

district sitting in commercial matters, justifying that there are sufficient funds to

deal with bankruptcy operations, or by paying the consignment fund a sum

sufficient to provide for it. In all cases, the costs of legal proceedings under this

article must be previously paid.

The French law of January 25, 1985, which in its article 169 refuses, with exceptions, to creditors the individual exercise of their

actions against the debtor even after closing for insufficient assets, is contrary to economic public order

Luxembourgish. Court November 14, 2002, 32, 385

Art. 536-1. (L. February 27, 1979) In the event of closure of the bankruptcy for insufficient assets, the costs

exposed by the curator will be taxed by the district court sitting in commercial matters.

The latter will pay the fees according to the nature and extent of the care given by the curator,

without these fees being less than a minimum or greater than a maximum to be set by

grand-ducal regulation.

The costs and fees will be advanced by the Registration Administration under the conditions

fixed by the law of March 29, 1893 concerning legal aid and the debt procedure.

58

Chapter VII. – Different kinds of creditors and their

rights

Section I. – Co-obligated and sureties

Art. 537. The creditor bearing commitments entered into, endorsed or guaranteed jointly by the

bankrupt and other co-obligors who are bankrupt, will participate in distributions to all masses, and

will appear for the face value of its security until its full payment.

1 ° The payments received by the creditors of a joint debtor with the bankrupt since the opening of the bankruptcy, are not to be

write off the debt owed at the time of this opening, unlike what takes place for payments made before the bankruptcy.

Court May 29, 1884, 2, 349.

2 ° The creditor who has received, after the bankruptcy of the principal debtor, the part of the debt jointly guaranteed by a third party not

bankrupt, can conclude the rejection of the production made by the surety and participate in the dividends of the bankruptcy for the entire

amount owed to him, without deduction of the payment made to him by the surety. Lux. February 23, 1907, 8, 483.

3 ° The creditor of a general partnership declared in a state of bankruptcy, bearing a personally guaranteed commitment

and jointly and severally by a partner declared also in a state of bankruptcy, has the right to file for bankruptcy liabilities of the co-obligated

joint and several for the nominal value of its debt, until full payment; he is not deprived of the right to be admitted, as

individual, to the bankruptcy estate, personal of the partner, by the circumstance that the curator of the bankrupt company has filed in

bankruptcy liabilities for the full amount of social liabilities, but the amount for which the creditor has been admitted to the mass of

the company is to be deducted from the production made by the bankruptcy trustee of the company to the personal bankruptcy of the partner; and the

creditor will not be included for this sum in the distribution to be made by the curator of the bankruptcy of the company, of the funds

that he will touch the personal bankruptcy of the partner. Court July 15, 1898, 4, 563.

Art. 538. No recourse, by reason of the dividends paid, is open to the bankruptcy of the co-obligated

against each other, if not when the meeting of dividends that these bankruptcies would give

would exceed the amount of the debt in principal and accessories, in which case this excess will devolve,

according to the order of the commitments, to those of the obligees who would have the others as guarantors.

Art. 539. If the creditor holding joint and several commitments between the bankrupt and other co-obligated, or

guaranteed by a surety, received, before the bankruptcy, a deposit on his debt, it will not be included in the

mass only under the deduction of this deposit, and will retain, for what remains due, its rights against

the co-obligated or the surety.

Art. 540. The co-obligated or the surety who will have made the partial payment will be included in the mass

for all that he will have paid to the discharge of the bankrupt.

Art. 541. Notwithstanding the composition, the creditors retain their action for the whole of their

claim against the coobliges of the bankrupt.

Section II. – Creditors pledged with pledges and privileged creditors on

movable property

Art. 542. The creditors of the bankrupt who are validly pledged will not be registered in the

mass only for the record.

The general movable privileges provided for by the law of November 27, 1933 concerning the collection of contributions

direct, excise duties and social insurance contributions, and a fortiori that provided for by article 23 of the law of 24 June

59

1970 regulating the hiring of workers’ services, take precedence over all other privileges, including those provided for in

articles 2102 and following of the Civil Code and in particular that of the pledge holder. Court May 2, 1979, 24, 317.

Art. 543. The curators may, at any time, with the authorization of the judge-commissioner, withdraw

pledges in favor of bankruptcy by repaying its debt.

Art. 544. If the pledge is not withdrawn by the curators, and if it is sold by the creditor for a price

which exceeds the debt, the surplus will be recovered by the said curators. If the price is less than the

debt, the secured creditor will contribute for the surplus in the mass as creditor

ordinary.

Art. 545. (L. 24 May 1989) Claims for wages, salaries and allowances resulting from

employment contract for the last six months as well as claims for compensation of any kind

resulting from the termination of the employment contract will be admitted to the number of privileged claims in the

same rank and under the same conditions as the privilege established by subsections (1) and (2) of

article 2101 of the Civil Code.

See Civil Code, art. 2101; L. May 24, 1989, art. 43 (Mem. 1989, 622), Workers and Employees; Reg. g.-

d. December 29, 1976 (Mem. 1976, 1522), Ceiling of employee privilege.

1 ° In matters of preventive composition of bankruptcy, merchant clerks are not entitled to the privilege established by article

2101, n ° 4 of the Civil Code for the benefit of service people, nor to the privilege established for workers and bankrupt clerks by article 545

of the bankruptcy law. Lux. January 30, 1904, 6, 432.

2 ° The state guarantee of the claims for remuneration and indemnities due to the employee on the date of the declaratory judgment of

bankruptcy for the last six months of work, extends to claims relating to periods more than six months prior to the

bankruptcy. Court adm. December 9, 1997, 30, 381.

Art. 546. The privilege and the right of reclamation established by n ° 4 of article 2102 of the Civil Code in

profit of the seller of movable effects as well as the right of rescission will not be allowed in the event of bankruptcy.

However, this privilege will continue to exist for two years, from the delivery, in favor of

suppliers of machinery and equipment used in industrial establishments.

It will have effect only insofar as, within the fortnight of this delivery, the deed recording the sale

is transcribed in a special register, kept for this purpose at the clerk of the district court sitting

in commercial matters of the district in which the debtor will have his domicile, and, failing

domicile, at the registry of the court in which the debtor will have his residence. The clerk of the court will be

required to make this transcript known to all persons who request it.

This privilege may be exercised even if the machines and devices have become

buildings by destination or by incorporation.

Delivery will be established, unless proven otherwise, by the books of the seller.

In the event of bankruptcy of the debtor, declared before the expiration of the two years of the duration of the privilege,

this will continue to exist until after the liquidation of the said bankruptcy.

1 ° The provision of article 546 is not intended to create a privilege for the benefit of suppliers of machines and devices,

but only to ensure, in the event of bankruptcy, the persistence of those enshrined in article 2102, n ° 4 of the Civil Code for the benefit of

these same suppliers. Lux. December 24, 1901, 6, 1.

2 ° Cannot be assimilated to “machines and devices used in industrial establishments”, machines or

devices having the character of buildings by nature. Lux. December 24, 1901, 6, 1.

3 ° The clause reserving to the seller of movable objects the ownership of the thing sold and delivered to the buyer until

full payment of the sale price is in the event of bankruptcy of the purchaser unenforceable against the mass. Lux. November 5, 1932, 12, 529; 14,

83; 13, 235.

4 ° The favorable provision of article 546, paragraph 2, of the Commercial Code, which maintains in favor of the supplier of

machines used in industrial establishments the privilege of the seller of household effects in the event of the buyer’s bankruptcy,

can only be invoked by the manufacturer and the one who professes to sell new machines.

Thus the claim of a garage owner who sells his establishment with the machines attached to it is not privileged. Lux. May 25

1935, 13, 564.

5 ° The stipulation that the item sold would remain the property of the seller until full payment of the price, is inoperative in

60

bankruptcy, the benefit of article 2102, n ° 4 of the Civil Code for the benefit of the seller of movable effects being abolished by

section 546 of the Bankruptcy Act. Lux. July 29, 1911, 10, 293.

6 ° All clauses and agreements whose purpose is to indirectly restore for the benefit of the seller the guarantees whose article

546 of the Commercial Code deprives it in the event of the buyer’s bankruptcy, are null with regard to the mass; this is the case with the clause

reserving for the seller the ownership of the thing sold and delivered to the buyer until full payment of the price. Lux. July 30

1925, 11, 470.

7 ° In the event of bankruptcy of the buyer, the seller of movable objects the price of which has not been fully paid, is not admitted to

to claim against the mass the things sold, although under the terms of the contract of sale he has reserved ownership

until full payment. Court June 18, 1929, 11, 532.

8 ° Article 546 of the Commercial Code, providing for the privilege and the right of claim established by n ° 4 of article 2102 of

Civil Code for the benefit of the seller of movable objects as well as the right of rescission are not allowed in the event of bankruptcy, applies

not only to goods acquired by the bankrupt for the purposes of his business, but also to goods intended

for his personal use. Court June 18, 1929, 11, 532.

9 ° When a sale of movable objects has been terminated by virtue of an express termination clause, the seller may claim,

with regard to the bankruptcy estate, the objects sold and delivered, even if the resolution of the contract only took place during the

suspicious period. Court March 10, 1931, 12, 216.

10 ° If the provisions of the law prevent the seller, after the declaration of bankruptcy, of movable objects not

paid exercises the resolutory action provided for in articles 1184 and 1654 of the Civil Code or obtains, by virtue of some pact

commission, the automatic resolution of the sale, these same provisions do not however aim at a resolution of the contract

intervened regularly before the declaration of bankruptcy.

Consequently, when in an installment sale it has been stipulated that the default of payment in one draft,

would authorize the seller to terminate the contract without any legal formality, three days after a simple formal notice, the

resolution of the sale which was accomplished by the effect of this stipulation, before the opening of the bankruptcy is opposable to the

creditors of the bankrupt. Court July 18, 1934, 13, 235.

11 ° The termination of a contract of sale occurring during the suspect period but before the declaration of bankruptcy, by virtue of

a clause in the contract reserving ownership of the item sold to the seller until full payment of the sale price and

providing that in default of payment of a due date, the agreement is automatically terminated after a notice remained

unsuccessful, does not fall under the provisions of articles 445 and 546 of the French Commercial Code. Court July 2, 1935, 13,

519.

12 ° As long as there is no declared bankruptcy, the action for rescission of the sale can be brought by the seller against the buyer

unpaid movable objects.

The action duly brought before the opening of the bankruptcy constitutes for the plaintiff an acquired right to see himself

judicially recognize the right of rescission which belonged to him at the time of the lodging of the request and this notwithstanding the

occurrence of bankruptcy. Court June 16, 1938, 14, 193.

13 ° In the absence of a bankruptcy judgment rendered by the competent court, i.e. the commercial court, the law

on bankruptcy cannot be applied in civil matters, even partially, and even though it results from the circumstances of the

cause that the debtor is in a state of effective suspension of payments. Lux. April 8, 1911, 9, 225.

14 ° If, in a genuine leasing contract, the lessor remains the owner of the leased item until the option is exercised, and may

therefore to oppose his right of ownership to the bankruptcy of the tenant, it is different, when the contract constitutes in reality a sale

with retention of title concealed under the legal appearance of a rental with option to purchase. Court May 25, 1977, 23, 533.

15 ° The privilege enshrined in article 546 of the Commercial Code is not established in favor of the sole supplier originating from

machines or devices used in an industrial establishment, but also benefits the assignee of the rights of the

provider.

A transport company whose object is the provision of services ensuring the movement of products and not participating

in any way to their development, can not be assimilated to an industrial establishment that can benefit from the privilege provided for in

article 546 of the French Commercial Code. Lux March 16, 1977, 24, 61.

16 ° All clauses and agreements whose purpose is to indirectly re-establish for the benefit of the seller the guarantees of which

Article 546 of the Commercial Code deprives it in the event of bankruptcy of the buyer, are null with regard to the mass. This is the case with the

clause reserving to the seller ownership of the item sold and delivered to the buyer until full payment of the price. Cass. 8

July 1993, 29, 222.

17 ° Article 30 (1) of the law of 24 May 1989 on the employment contract, by virtue of which the employee is entitled to the maintenance of wages

or treatments relating to the month of the occurrence of the event and the month thereafter, and the award of compensation

equal to 50% of the monthly payments relating to the notice period to which the employee could have claimed in accordance with article 20

of the same law, does not regulate the rights of employees for the wages due, but only their rights after bankruptcy, the term

of “maintenance” of wages obviously aiming to preserve employees for the future of a right that they would normally have

lost by the effect of bankruptcy and the termination with immediate effect of the ensuing employment contract.

Decide otherwise and include the wages due for the days of actual work in the severance indemnity provided for in

the aforementioned article 30 would amount to remunerating these days twice. Court February 20, 1997, 30, 337.

Art. 547. The curators will present to the judge-commissioner the statement of creditors claiming to be

privileged over the movable property, and the judge-commissioner will authorize, if necessary, the payment of these

creditors on the first money received.

If the privilege is contested, the court will rule.

61

Section III. – The rights of mortgage and privileged creditors over the

buildings

Art. 548. When the price distribution of buildings is made prior to that of the price of

movable property, or simultaneously, the privileged or mortgage creditors not fulfilled on the price

buildings will contribute in proportion to what will remain due to them with unsecured creditors,

on the funds vested in the unsecured mass, provided however that their claims have been

affirmed and verified according to the forms established above.

Articles 548 and 582 of the Bankruptcy Law of July 2, 1870 are not applicable to the state of insolvency of a non-trader,

bankruptcy rules cannot, in the absence of a special text, be extended to collapse. Lux. February 26

1896, 4, 89.

Art. 549. If, before the distribution of the price of the buildings, one or more distributions are made

of money, the privileged creditors on the buildings and the mortgage creditors will contribute to

these distributions in the proportion of their total debts, and except, where applicable, the distraction of which

it will be discussed below.

Art. 550. After the sale of the buildings and the final settlement of the order between the creditors

mortgage and privileged, those of them who will want in useful order on the price of buildings,

for all of their debt, will only receive the amount of their mortgage collocation under the

deduction of sums by them received in the unsecured mass.

The sums thus deducted will not remain in the mortgage pool, but will return to the

unsecured mass for the benefit of which it will be distracted.

Art. 551. With regard to mortgage creditors who will be collocated only partially in the

distribution of the price of buildings, it will be carried out as follows: their rights on the mass

unsecured will be definitively settled according to the sums of which they will remain creditors after

this real estate collocation, and the funds that they will have touched beyond this proportion, in the

prior distribution, they will be withheld from the amount of their mortgage collocation, and reserved

in the unsecured mass.

Art. 552. Mortgage creditors who do not come into working order will be considered as

unsecured and subject as such to the effects of the composition and all operations of the mass

unsecured.

Section IV. – The rights of one spouse in the event of the bankruptcy of the other

(L. February 4, 1974)

Art. 553. The spouse of the bankrupt will take back in kind his own property and those that have fallen into

community of its leader.

Art. 554. Repealed.

Art. 555. Whatever the matrimonial regime, the legal presumption is that all movable property

or buildings belong to the bankrupt, have been paid out of his money and must be reunited with the mass of

his assets, except for the spouse to provide proof to the contrary according to the rules established in article 1402 of the

Civil Code.

62

Art. 556. The recovery action of the non-bankrupt spouse will only be brought against the debts and

mortgages the property of which is legally encumbered, either that he has voluntarily committed himself or that there

has been condemned.

Art. 557. If the bankrupt was a trader at the time of the celebration of the marriage or became one in

during the two years which will have followed this celebration, his spouse will not be able to exercise in bankruptcy any

action for the benefits of the marriage contract; and, in this case, the creditors cannot

take advantage of the advantages provided by the spouse to the bankrupt in the same contract.

Art. 558. If the spouse has paid debts for the bankrupt, the legal presumption is that he has paid debts.

money of the bankrupt, and he will therefore not be able to exercise any action in the bankruptcy, except for the proof

contrary, as stated in article 555.

Art. 559 and 560. Repealed

Chapter VIII. – Distribution among creditors

Art. 561. The amount of the movable assets of the bankrupt, excluding the costs and expenses of

administration of the bankruptcy, the relief which would have been granted to the bankrupt or his family, and

sums paid to privileged creditors, will be distributed among all creditors, to the marc the franc of

their claims affirmed and verified.

To this end, the curators will provide the judge-commissioner with a status report every month.

bankruptcy and money deposited in the consignment fund; the commissioner will order, if there is

instead, a distribution between the creditors and will fix the amount.

The creditors will be informed of the decisions of the bankruptcy judge and of the opening of the distribution,

by circulars posted in the manner prescribed by Article 496.

The character of universality attributed to bankruptcy, as well as the principle of equality between the creditors of the mass, a principle which

is governed by law and public order, prohibit the Luxembourg judge from granting during bankruptcy to a creditor to the detriment of the

mass of advantages and privileges that it did not have before the bankruptcy. Lux. January 22, 1909; conf. Court June 18, 1909, 8, 22.

Art. 562. If there are unverified creditors, in respect of whom the extended period under

section 497 has not yet expired, or creditors whose claims declared and asserted in the

prescribed period have given rise to disputes that have not yet been adjudicated, no

distribution only after setting aside the part corresponding to their due dates, as they are

carried on the balance sheet, as to the first, and as they were declared and affirmed, as to the

seconds.

When the debts belonging to creditors domiciled or residing outside the Grand Duchy, to

for whom the time limit has been extended in accordance with Article 498, will not appear on

the balance sheet in an exact manner, the judge-commissioner may decide that the reserve will be increased, except

the curators to appeal against this decision to the district court sitting in

commercial matter.

Art. 563. No payment will be made by the curators except on the representation of the constitutive title.

of the claim.

The curators will mention on the title the amount paid or mandated by them in accordance with

article 480. If it is impossible to represent the title, the judge-commissioner may authorize the

payment on sight of the verification report. In all cases, the creditor will give the

receipt on the sidelines of the pay-as-you-go statement.

63

Chapter IX. – The sale of the bankrupt’s buildings

Art. 564. (L. June 22, 1984) If there are no proceedings for the expropriation of buildings,

started before the rejection or annulment of the composition, the curators alone will be allowed to continue

the sale; they will be required to do so within a week, under the authorization of the judge-commissioner,

in accordance with the special provisions regulating the matter (L. 22 June 1984).

The curators will always be able to stop the proceedings started, by proceeding in the same

forms, with the authorization of the district court sitting in commercial matters, the bankrupt

called, for the sale of the seized buildings.

In this case, they will notify the suing creditor and the bankrupt at least eight days before the

sale, the place, day and time to which it will be carried out.

A similar notification will be made within the same time limit to all creditors registered in their domicile.

elected in the registration form.

Art. 565. During a fortnight after the auction, any person will have the right to outbid. The

overbidding may not be below one tenth of the main auction price; it will be made by

bailiff’s exploit notified to the notary who will have proceeded to the adjudication and denounced to the curators and

the successful tenderer. The auction following an overbid will be made at the request of the curators without

subsequent authorization, by the same public officer and in the same manner as the first auction.

Anyone will be allowed to participate in this auction, which will remain final and cannot

be followed by no further bidding.

1 ° The form of the overbidding, as indicated by article 565, is one and indivisible in the sense that in the sole and

same period of two weeks after the auction, the intention to increase the bid must be notified both to the notary and

the successful tenderer and the curator; as article 565 decrees an exceptional right to common law, the exercise of this right must be

strictly limited and subordinated to the observance of the duties and forms prescribed therein; the rules for overbidding in the event of

sale of the bankrupt’s buildings are substantial and the very validity of the bidding depends on their rigorous observation; through

Consequently, the overbid denounced after the aforementioned period of two weeks must be declared null and void.

Lux. April 22, 1885, 3, 264.

2 ° When a hypothecary creditor acquires a building dependent on bankruptcy, the sale price is not

not compensate with the debt to which the property sold is mortgaged, the compensation not being able to

arise between a debt of the bankrupt having an existence prior to the bankruptcy and a debt which arises after the bankruptcy in

profit from it. Lux. November 27, 1895, 5, 487.

3 ° Does not exceed the limits of the administrative power of the curator and is valid and enforceable against creditors

mortgage, the agreement by virtue of which the curator, duly authorized by the judge-commissioner, abandoned

any excess of the fixed price stipulated for the costs of a sale of buildings, to the notary, who, in return for this

abandonment, undertook to guarantee the solvency of the purchaser and to discount the price at any requisition of the curator. Lux. 27

November 1895, 5, 487.

64

Chapter X. – Of the claim

Art. 566. Can be claimed in the event of bankruptcy, remittances in commercial paper or

other securities not yet paid, and which will be in kind in the bankrupt’s portfolio on the date of

declaratory judgment of bankruptcy, when these deliveries have been made by the owner with simple

mandate to collect them and keep their value at their disposal, or when they have been

on its part specially allocated to specific payments.

1 ° When a bill of exchange, endorsed by current account value to the order of a company declared bankrupt, was already

arrived in the possession of it before the declaration of bankruptcy not reported to a previous period, this draft cannot

no longer be claimed by the endorser; the endorser’s claim also does not enjoy any privilege. Court June 22, 1883, 2, 191.

2 ° Judgments ruling on claims based on articles 566 and

following articles of the Commercial Code, while these articles contain, in the event of bankruptcy, a special regulation of the right of

claim.

It follows that the judgment ruling on such a claim is to be considered as having been rendered in

bankruptcy and that the appeal against this judgment more than fifteen days after service is inadmissible for cause

of tardiness. Court December 16, 1964, 19, 541.

Art. 567. (L. March 31, 2000) Goods consigned to the bankrupt, either as a deposit or for

be sold on behalf of the owner, may be claimed, provided that they are

found in kind at the time of the opening of the procedure.

In the event of resale of these goods by the bankrupt before the opening of the procedure, the

owner can claim the price or the part of the price for which the buyer has not paid, of some

whatever, on the date of the declaration of bankruptcy.

1 ° If the claimant, who acts against the bankruptcy estate, must provide proof of his exclusive ownership of the objects

claimed and their identity, it is not necessary, however, when it comes to bearer securities acquired by a bank for

account of several persons, that the numbers of the titles to be given to each of them can be specified; it is enough

that it be established by the facts of the case that among the titles held by the masses are, to the exclusion of all doubt, those

acquired on behalf of the claimants, the distribution of the titles between them can then be done without any difficulty and the

title numbers being indifferent. Lux. May 28, 1925, 11, 206.

2 ° To know if in the event of bankruptcy the right to claim something exists or not, it is necessary to refer to the law called to govern

the contract under which the bankrupt holds the thing. Lux. January 13, 1962, 18, 507.

Art. 567-1. (L. March 31, 2000) The seller of non-fungible movable property, which is agreed with the

failed to reserve ownership until full payment of the price, may claim this property, when

is found in kind at the time of the opening of the procedure or can be recovered without damage

for the property in which it was incorporated, within three months of the last of the

publications of the declaratory bankruptcy judgment referred to in section 472.

The retention of title clause must be recorded in a written document at the latest at the time

of the delivery or the first delivery in the case of a writing governing a set of operations.

In case of resale of the property by the bankrupt before the opening of the procedure, the seller can claim,

within the same period, the price or the part of the price for which the buyer has not paid, of some

whatever, on the date of the declaration of bankruptcy.

1 ° In bankruptcy matters, in the event of retention of title of non-fungible movable property, the words “… the seller may

to claim… ”provided for in article 567-1, paragraph 1, of the French Commercial Code, are not to be read in the sense that it is necessary to assign

within three months from the last publication of the bankruptcy declaration. Therefore, even if

the court summons took place outside the said time limit, the claim is not inadmissible because of

delay, if the applicant has claimed the disputed object from the curator within the time limit. Cass. March 9, 2006, 33, 95.

2 ° The declaration of claim does not imply waiver by a creditor of the exercise of his claim. Courtyard 8

November 2007, 34, 125.

3 ° The person subrogated in the rights of the seller beneficiary of a retention of title clause may exercise the action by

claim. Court November 8, 2007, 34, 125.

4 ° The claim action is possible if the retention of title clause is contained in an invoice accepted by the

bankrupt prior to delivery. Court November 8, 2007, 34, 125.

Art. 568. Goods sent to the bankrupt may also be claimed, as long as the

tradition will not have been carried out in its stores, or in those of the commission agent in charge of

sell them on behalf of the bankrupt.

Nevertheless, the claim will not be admissible, if, before their arrival, the goods have been

sold without fraud, on invoices and on bills of lading or waybills signed by the shipper.

1 ° The term “store” used in article 568 of the Commercial Code must be taken in a very broad sense; it is necessary

in particular include the platforms of a railway station when the bankrupt is authorized to pile up or keep his

goods, either by virtue of a formal concession or by virtue of a custom and by simple tolerance, and that these goods

are not only accidentally deposited there but to stay there for a longer or shorter time, the buyer having only the

available during this time. Lux. December 11, 1926, 12, 73.

2 ° In the event of the sale of cut timber, the cut floor is to be assimilated to the store for the application of article 568 of the

Commercial Code, when due to some publicity surrounding either the sale or the exploitation of the cut, third parties have

known the buyer and may have considered the timber acquired by him as an element of his credit, in particular when the buyer or

its workers proceeded to measuring, debarking, cutting and shaping the wood. Lux. November 5, 1932, 12, 529.

3 ° The clause in the specifications drawn up for the adjudication of a cut of timber that the ground of the cut does not

will not be considered as the contractor’s yard or warehouse, and that timber deposited there and not paid for may be

withheld in bankruptcy, is not unlawful.

Made known to the public, among other things by reading the conditions of the auction during the

auction, it is opposable to third parties, and especially to the mass of the bankruptcy of the purchaser. Court July 31, 1934, 13, 205.

Art. 569. The claimant will be required to reimburse to the mass the deposits received by him, thus

that any advances made for freight or car, commission, insurance or other charges, and to pay the

sums that would be due for the same causes.

Art. 570. Goods sold by him that are not

not delivered to the bankrupt, or which have not yet been sent, either to him or to a third party for his

account.

1 ° The seller of goods purchased by a bankrupt and not yet shipped at the time of the declaration of bankruptcy

may, in the event that the curators refuse to take delivery and pay the price thereof, request the termination of the contract of sale, with

damages. Cass. August 4, 1893, 3, 193.

2 ° The seller, by delivering the item sold, definitively waives the right of retention that he could

exercise due to non-payment of the price; if, thereafter, he takes again, with the buyer’s consent, the possession of

the object sold, he can no longer assert with regard to the bankruptcy estate, article 570 of the Commercial Code. Lux. July 30, 1925,

11, 470.

3 ° The clause in the specifications drawn up for the adjudication of a cut of timber that the ground of the cut does not

will not be considered as the contractor’s yard or warehouse, and that timber deposited there and not paid for may be

withheld in bankruptcy, is not unlawful.

Made known to the public, among other things by reading the conditions of the auction during the

auction, it is opposable to third parties, and especially to the mass of the bankruptcy of the purchaser. Court July 31, 1934, 13, 205.

Art. 571. In the case provided for in Articles 568 and 570, and under the authorization of the judge-commissioner,

the curators will have the option of requiring the delivery of the goods, by paying the price agreed between

him and the bankrupt.

Art. 572. The curators may, with the approval of the judge-commissioner, admit the requests

in claim, and, if there is dispute, the court will rule on the report of the judge-commissioner.

In bankruptcy, the claimant is only admissible to submit his claim to court after having unsuccessfully attempted

to have it amicably admitted by the bankruptcy trustee with the approval of the bankruptcy judge. Lux. January 13, 1962, 18,

507.

TITLE II. – Bankruptcies

Chapter I. – Simple bankruptcy

Art. 573. Any bankrupt trader who is in one of the

following cases:

1 ° if personal expenses or household expenses are considered excessive;

2 ° if he has consumed large sums of money in gambling, in pure chance operations, or in operations

fictitious stock market or commodity;

3 ° if, with the intention of delaying his bankruptcy, he has made purchases to resell below the price;

if, with the same intention, he indulged in loans, circulation of bills, and other ruinous means

to raise funds;

4 ° if he has incurred expenses or losses or if he does not justify the existence or use of

the assets of his last inventory and the money, securities, furniture and effects, of whatever nature they

be, which would have come to him subsequently;

5 ° if, after the cessation of his payments, he has paid or favored a creditor to the prejudice of the

mass.

Art. 574. Any trader who is in one of the

following cases:

1 ° if he has contracted for the account of others, without receiving securities in exchange, commitments

considered too considerable, having regard to his situation when he contracted them;

2 ° if he is again declared bankrupt, without having fulfilled the obligations of a precedent

concordat;

3 ° (L. 12 December 1972) if, having derogated by contract from the provisions of the legal matrimonial regime,

he did not comply with section 69;

4 ° if he has not made an admission of the cessation of his payments within the time limit prescribed by article 440; if

this confession does not contain the names of all the solidary associates; if, in doing so, he did not provide the

information and clarifications required by section 441, or if such information or

clarifications are incorrect;

5 ° if he is absent without the authorization of the judge-commissioner or if, without legitimate impediment, he does not

did not attend in person the summons sent to him by the commissioner or by the

curators;

6 ° (L. 19 December 2002) if he has not kept the books prescribed by article 9; if he didn’t

the inventory required by section 15; if its books and inventories are incomplete or irregularly kept, or

if they do not offer their true active and passive situation, without however there being fraud.

Art. 575. Will be condemned to the penalties of simple bankruptcy, without prejudice, if necessary, to

the application of section 578:

1 ° those who, in the interest of the bankrupt, have withdrawn, concealed or concealed all or part of his property

furniture or buildings;

2 ° those who have fraudulently presented in bankruptcy and asserted, either in their name or by

interposition of no one, supposed or exaggerated claims;

3 ° the creditor who will have stipulated, either with the bankrupt or with any other person, the advantages

individuals by reason of his vote in the deliberations of the bankruptcy, or who will have made a particular treaty

67

from which would result, in his favor, a benefit payable by the bankrupt’s estate;

4 ° the curator who is guilty of wrongdoing in his management.

The culprits will, in addition, be fined equal to the value of the benefits

illegally stipulated or to restitution and damages due to the body of creditors, and which

cannot be less than 3 euros.

Art. 576. The managers of the companies may be condemned to the penalties of simple bankruptcy.

anonymous who have not provided the information requested of them, either by the judge commissioner,

either by the curators, or who have given inaccurate information.

It will be the same for those who, without legitimate hindrance, will not have gone to the

summons of the judge-commissioner or curator.

Chapter II. – Fraudulent bankruptcy

Art. 577. Any bankrupt trader who finds himself in one of the

of the following cases:

1 ° (L. 19 December 2002) if he has removed all or part of the books or accounting documents

referred to in Articles 9, 14 and 15 of the Commercial Code, or if he has fraudulently removed, erased or

altered content;

2 ° if he has misappropriated or concealed part of his assets;

3 ° if, in its writings, either by public documents or commitments under private signature, or

through his balance sheet, he fraudulently recognized himself as a debtor of sums that he did not owe.

Art. 578. Will be declared accomplices of fraudulent bankruptcy, those who, by one of the means

indicated in article 60 of the Penal Code, will have provoked the facts mentioned in the previous article, or

given instructions to carry them out, and those who have, with knowledge, aided the

fraudulent bankrupt in the facts which will have prepared or facilitated his bankruptcy or in those which

will have consumed it.

Chapter III. – General provisions

Art. 579. In the cases provided for in Articles 575, 577 and 578, the Court or the tribunal seised

will rule, even if there is an acquittal:

1 ° ex officio on the reinstatement in the body of creditors of all assets, rights or actions

fraudulently withdrawn;

2 ° on the damages which would be requested and which the judgment or the judgment will arbitrate.

The agreements will, moreover, be declared void with regard to all persons and even with regard to

of the bankrupt.

The creditor will be required to report, to whom it may concern, the sums or securities that he has received in

under canceled agreements.

Art. 580. In the event that the annulment of the fraudulent acts or agreements mentioned in Articles

575 and 577 would be prosecuted by civil means, the action will be brought before the district court

68

sitting in commercial matters in the jurisdiction of which the bankruptcy opened.

Art. 581. The costs of prosecution for simple or fraudulent bankruptcy cannot be made available.

charge of the mass only in the event of acquittal, when the curators, authorized by deliberation

taken by an individual majority of the creditors present, will have brought a civil action.

The fact that the trustee of a bankruptcy was not authorized by a deliberation of the majority of the creditors to become party

civil in a lawsuit for fraudulent bankruptcy, has as only consequence that in the event of acquittal of the accused the

costs cannot be charged to the mass, but the curator is nonetheless admissible to bring a civil action. Courtyard 3

March 1921, 11, 546.

Art. 582. In the event of a composition, the recourse of the Public Treasury against the bankrupt, for costs, cannot

be exercised only after the expiration of the terms granted by this treaty.

Art. 583. All judgments or judgments of conviction rendered under Articles 573 to 578 will be

posted and published in the manner and according to the forms established by article 472, and at the expense of

condemned.

Chapter IV. – Administration of property in the event of bankruptcy

Art. 584. In all cases of prosecution and conviction for simple bankruptcy or

fraudulent, civil actions, other than those mentioned in article 579, will remain separate, and

all the provisions relating to the property prescribed for bankruptcy, will be carried out, without

can be attributed or evoked to the police correctional courts, or to the Assize Court.

Art. 585. However, bankruptcy trustees will be required to hand over to the public prosecutor the

documents, titles, papers and information which will be requested of them. These documents, titles and papers will be,

during the course of the investigation, kept in a state of communication through the registry; this

communication will take place on the requisition of the curators, who may take private extracts or

request authentic ones which will be delivered to them on plain paper and free of charge by the clerk.

The documents, titles and papers which the judicial deposit will not have been ordered, will be, after the judgment or

the judgment, given to the curators, who will discharge it.

69

TITLE III. – Rehabilitation

Art. 586. The bankrupt who has paid in full, in principal, interest and costs, all sums

by him due, will be able to obtain his rehabilitation.

He will not be able to obtain it, if he is the joint and several partner of a business house that has fallen into bankruptcy,

that after having justified that all the debts of the company have been fully paid in principal,

interest and costs, even when a special arrangement has been granted to him.

The bankrupt can be rehabilitated after his death.

Art. 587. Any request for rehabilitation will be addressed to the Superior Court of Justice. The

the applicant will attach the receipts and other supporting documents to his application.

The Attorney General at the Superior Court of Justice, on the communication made to him

of the request, will send certified shipments from him to the State Prosecutor and to the President of the

district court sitting in commercial matters of the domicile of the applicant, and, if it has changed

of domicile since the bankruptcy, to the state prosecutor and to the president of the district court sitting

in commercial matters of the district where it took place, by instructing them to collect all

information which will be at their fingertips on the truth of the facts which will have been exposed.

To this end, at the behest of the State Prosecutor, a copy of the said request will remain posted, for a period of time.

two-month period, both in the courtrooms of the civil court and the district court

sitting in commercial matters only at the common house, and will be inserted by extracts into the

public papers.

Art. 588. Any creditor who has not been paid in full of his claim, in principal, interest

and costs, and any other interested party, may, during the duration of the poster, oppose the

rehabilitation by simple act at the registry, supported by supporting documents. The opposing creditor does not

can never be a party in the rehabilitation proceedings.

Art. 589. After the expiration of the two months, the state prosecutor and the president of the court

of district sitting in commercial matters will send, each separately, to the public prosecutor

general to the Superior Court of Justice, the information they will have gathered and the objections

who may have been trained; they will attach their opinion on the request.

The Attorney General at the Superior Court of Justice will issue a judgment on the whole

admission or rejection of the request for rehabilitation. If the request is rejected, it cannot be

reproduced only after a year apart.

Art. 590. The rehabilitation judgment will be addressed both to the State Prosecutor and to the President of

courts to which the request has been addressed. These courts will have it read to the public and

the transcription on their registers.

Art. 591. Fraudulent bankrupters, people

condemned for theft, forgery, misappropriation, fraud or breach of trust, the stellionaires,

custodians, guardians, administrators or other accountants who have not returned and settled their

accounts.

May be admitted to rehabilitation, the simple bankrupt who has suffered the penalty to which he will have

been sentenced.

Art. 592. Repealed (L. August 10, 1991)

70

Title IV. – Payment deferrals

Art. 593. (Arr. L.-d. October 4, 1934) The deferment of payment is only granted to the merchant who, by

following extraordinary and unforeseen events, is forced to temporarily cease

payments, but which, according to its duly verified balance sheet, has sufficient property or means to satisfy

all its creditors in principal and interest. The suspension of payment may also be granted if the

the trader’s situation, although currently in deficit, contains serious elements of

restoring the balance between assets and liabilities.

In the event of the death of a merchant, suspension of payment of his debts may be granted to his

beneficiary heirs, for the causes and under the conditions determined in the previous paragraph.

Art. 594. The debtor will apply simultaneously to the district court

sitting in commercial matters in the borough of which he is domiciled and at the Superior Court

of justice.

He will attach to his request:

1 ° a statement of the events on which he bases his request;

2 ° the detailed and estimated statement of its assets and liabilities;

3 ° the list of names of its creditors, with the indication of their domicile and the amount of their

receivables.

The request addressed to the Superior Court of Justice will be communicated by the president to the

Attorney General; it must be signed by a solicitor to this Court.

Art. 595. The request addressed to the district court sitting in commercial matters will be

delivered to the clerk, who will give a receipt without drawing up an act of deposit.

On this request, the president will fix the place, day and time at which, in the fortnight, the

creditors will be summoned, and he will indicate the newspapers in which the summons will be inserted.

The tribunal, summoned, if necessary, extraordinarily, will appoint one or more experts, who

will verify the state of affairs of the debtor, and will appoint one of his judges to

monitor operations.

The court may, either immediately or during the course of the investigation, grant the debtor a

temporary stay.

In this case, the court will appoint one or more commissioners to supervise and

monitor the debtor’s operations throughout the duration of this suspension.

Art. 596. (Arr. Left of October 4, 1934) The creditors will be individually summoned by the

judge-commissioner and by registered letters delivered to the post office at least eight days

before the one fixed for the meeting; the summons will also be inserted three times

different in the newspapers designated by the judge-commissioner. The convocation will reproduce the text of the

articles 597 and 599 of the French Commercial Code, as supplemented respectively by the

present arrested.

A copy of the newspapers in which the summons has been inserted, will be filed with the registry

before the meeting of creditors.

The debtor will deposit the sum deemed necessary to cover the costs of these summons and

insertions in the hands of the clerk by whose care they will be made.

Art. 597. (Arr. L.-d. October 4, 1934) On the day indicated, the judge-commissioner will report to the

court in the presence of creditors or their authorized representatives.

The creditors or their authorized representatives will be heard contradictorily with the debtor; they

71

will individually declare the amount of their debts and whether they adhere or do not adhere to the

request. Any creditor may validly make the declaration of his claim in writing accompanied by

of his vote; this declaration must reach the registry before the day of the meeting of creditors.

A detailed report will be drawn up at all, to which will be annexed the documents which would have been

produced by both creditors and debtors.

The court will attach its reasoned opinion to it.

The commercial court seized of a request for suspension of payment does not commit any excess of power by pronouncing

automatically the bankruptcy of the debtor if the examination of the request establishes that this one has stopped its payments and that its credit is disturbed;

it is only after having granted a temporary stay and given the opinion required by Articles 597 and 598 of the Commercial Code that

is provisionally relinquished in favor of the Court until after the latter’s decision. Court November 6, 1934, 13, 296.

Art. 598. The court’s opinion, as well as all the documents relating to the request, will be sent,

within three days, to the Attorney General at the Superior Court of Justice, who will submit them, with

its conclusions, to the president; the latter will appoint an adviser, on whose report the Court will rule

within a week of receipt of the parts.

Art. 599. (Arr. L.-d. October 4, 1934) The Court cannot grant a stay, even though the

merchant fulfills the conditions provided for in Article 593, only if the majority of creditors

representing, by their claims, three quarters of all sums due, have adhered to the

request.

(Arr. Lr October 4, 1934) Majorities in the number of creditors and claims will be established in

counting as members on demand for the amount of their debts the persons of

creditors who have not made an oral or written statement.

Neither will the claims declared privileged by article 605, nor the persons

to which these debts are due.

Art. 600. (Arr. L.-d. October 4, 1934) The Court, by granting a stay, fixes its duration.

It will appoint one or more commissioners responsible for monitoring and controlling the operations of the

debtor for the duration of the stay.

The stay may be extended at the request of the debtor, the Attorney General heard in his

written conclusions. This request will be addressed to the Superior Court of Justice and must be signed.

by a solicitor to this Court. The Court will hear the debtor and the commissioner (s).

The rejection of the request automatically entails the revocation of the provisional suspension.

The benefit of the suspension does not pass to the heirs of the debtor to whom it has been granted, except in the case of

acceptance of the succession under benefit of inventory.

Art. 601. The judgment which will have granted a temporary stay, or the judgment which will have granted a stay

final or an extension of the stay, will be, at the behest of the supervising commissioners, and in the

three days from its date, displayed in the audience of the district court sitting in

commercial and published in newspapers designated by the President, under section 595.

Art. 602. The expert verifiers and the supervising commissioners are chosen from among the

people domiciled in the arrondissement.

Before taking up their duties, the expert verifiers will lend, in the hands of the judge commissioner,

the oath to do well and faithfully fulfill their mission.

The supervising commissioners will take the same oath in the hands of the president of the tribunal.

district sitting in commercial matters.

Their fees will be taxed by the district court sitting in commercial matters,

according to the nature and importance of the debtor’s business. They will be, as well as the disbursements, paid by

privilege.

72

The debtor’s creditors, who have been appointed as commissioners, will not be entitled to

fees.

Art. 603. The payment of debts existing at the time of the request cannot be made, during

the duration of the stay, to all creditors in proportion to their claims.

When there are disputed claims, the procedure will be as stated in article 562 of this present

coded.

The debtor may not, without the authorization of the supervising commissioners, alienate, engage or

mortgage his property, movable or immovable, plead, compromise, borrow, receive any sum,

make any payment, nor engage in any act of administration.

In the event of opposition, it will be ruled by the district court sitting in matters

commercial.

Art. 604. During the period of suspension, no means of execution may be used against the

person or property of the debtor. Coercion by body or seizures made before the stay

remain in state, but the court may, depending on the circumstances, grant release, after

having heard the debtor, the creditor and the supervising commissioners.

The stay does not suspend the price of the actions brought or the exercise of new actions against the

debtor, unless the purpose of these actions is to demand payment of a debt not

contested.

However, during the period of the provisional and definitive suspension, no registration may be taken.

mortgage on the buildings of the debtor, by virtue of judgments rendered during the same periods.

Art. 605. The suspension only applies to commitments contracted prior to its obtaining. He

does not benefit the co-debtors, nor the sureties who have waived the benefit of discussion. It is without

relatively effect:

1 ° taxes and other public charges;

2 ° to claims secured by privileges, mortgages or pledges;

3 ° to claims due as maintenance;

4 ° to the supplies of subsistence made to the debtor and his family, during the six months which have

preceded the stay.

Art. 606. Hypothecary or privileged creditors may not, during the period of the stay, make

seize or sell the buildings and their accessories necessary for the exercise of the

profession or industry of the debtor, provided that the current interest on the secured claims is

exactly paid.

Art. 607. The revocation of the stay may be requested by one or more creditors or by the

supervising commissioners, if the debtor is guilty of fraud or bad faith, if he

infringed Article 603, or if it appears that its assets no longer offer sufficient resources to

pay all debts in full.

The request for revocation will be addressed to the district court sitting in matters

commercial, which, after hearing the debtor, will rule, if it is a provisional stay, or will issue

his opinion, if it is a final stay.

Any judgment or judgment revoking a stay will be published and posted in the manner and in the

places prescribed by article 601.

Art. 608. Any withdrawal of an application for a stay will be addressed both to the Superior Court of Justice

than the district court sitting in commercial matters.

It will be noted on the production of proof that a notice announcing the request for withdrawal has

73

been previously published in the form prescribed by Article 595.

Art. 609. The judgment which has granted, refused or revoked a provisional stay will not be

susceptible to neither opposition nor appeal.

The debtor may however oppose the judgment revoking the temporary stay,

if, as a result of a legitimate impediment, he has not been heard.

Judgments rendered in matters of suspension may be referred to the Superior Court of Justice by

civil petition.

Art. 610. All acts, documents or documents tending to shed light on the religion of the tribunal and the Court

superior justice, on requests for suspension, may be produced and filed by the debtor, the

creditors or supervisory auditors, without having to have them previously covered

the formality of the stamp or registration.

Judgments relating to concession, extension or

revocation of provisional stays.

Art. 611. The debtor will be punished with the same penalty as the simple bankrupt:

1 ° if, in order to determine or facilitate the issuance of the suspension, he has, in any way whatsoever,

deliberately concealed part of its liabilities or exaggerated its assets;

2 ° if he made or allowed to intervene in the deliberations relating to the request for suspension one or more

supposed creditors, or whose claims for which they took part in the deliberations, have

been exaggerated.

Art. 612. The same penalty shall apply to those who, without being creditors, have taken part in the

deliberations relating to the request for a stay, or who, being creditors, have fraudulently

exaggerated the claims on account of which they contributed to these deliberations.

Art. 613. In the event of the debtor’s bankruptcy, within six months of the expiration of the stay, the period

of suspension of payment, by way of derogation from article 442, will go back, as of right, to the day of the

request for a stay.

Regardless of the nullity pronounced by article 445, all acts carried out are null and void.

by the debtor, without the authorization of the supervising commissioners, in cases where this authorization is

required.

Art. 614. Deferment of payment may be granted to owners of industrial establishments

who are not deemed to be traders by law.

All the provisions of this title are applicable to this suspension, with the exception of article 613.

If, at the expiration of this stay, there is collapse or transfer of property, mortgages taken in

by virtue of judgments rendered during its term, as well as all acts made by the debtor without

the authorization of the supervising commissioners, in the event that this authorization is required, will be void and

of no effect.

the Superior Court of Justice

than the district court sitting in commercial matters.

It will be noted on the production of proof that a notice announcing the request for withdrawal has

73

been previously published in the form prescribed by Article 595.

Art. 609. The judgment which has granted, refused or revoked a provisional stay will not be

susceptible to neither opposition nor appeal.

The debtor may however oppose the judgment revoking the temporary stay,

if, as a result of a legitimate impediment, he has not been heard.

Judgments rendered in matters of suspension may be referred to the Superior Court of Justice by

civil petition.

Art. 610. All acts, documents or documents tending to shed light on the religion of the tribunal and the Court

superior justice, on requests for suspension, may be produced and filed by the debtor, the

creditors or supervisory auditors, without having to have them previously covered

the formality of the stamp or registration.

Judgments relating to concession, extension or

revocation of provisional stays.

Art. 611. The debtor will be punished with the same penalty as the simple bankrupt:

1 ° if, in order to determine or facilitate the issuance of the suspension, he has, in any way whatsoever,

deliberately concealed part of its liabilities or exaggerated its assets;

2 ° if he made or allowed to intervene in the deliberations relating to the request for suspension one or more

supposed creditors, or whose claims for which they took part in the deliberations, have

been exaggerated.

Art. 612. The same penalty shall apply to those who, without being creditors, have taken part in the

deliberations relating to the request for a stay, or who, being creditors, have fraudulently

exaggerated the claims on account of which they contributed to these deliberations.

Art. 613. In the event of the debtor’s bankruptcy, within six months of the expiration of the stay, the period

of suspension of payment, by way of derogation from article 442, will go back, as of right, to the day of the

request for a stay.

Regardless of the nullity pronounced by article 445, all acts carried out are null and void.

by the debtor, without the authorization of the supervising commissioners, in cases where this authorization is

required.

Art. 614. Deferment of payment may be granted to owners of industrial establishments

who are not deemed to be traders by law.

All the provisions of this title are applicable to this suspension, with the exception of article 613.

If, at the expiration of this stay, there is collapse or transfer of property, mortgages taken in

by virtue of judgments rendered during its term, as well as all acts made by the debtor without

the authorization of the supervising commissioners, in the event that this authorization is required, will be void and

of no effect.

Leave a Comment

Your email address will not be published.


CAPTCHA Image
Reload Image