Droit de sociétés / Corporate law
Nullity of an SARL (société à responsabilité limitée) General Meeting due to a participant’s lack of status as a shareholder
The participation of a person who is not a shareholder in the collective decisions of an SARL constitutes a cause of nullity of the General Meetings at which these decisions were taken, when the irregularity is such as to influence the outcome of the decision-making process.
Unilateral contract termination without prior formal notice
With an important decision dated 18 October 2023, the Commercial Chamber of the French Supreme Court (Cour de cassation) has ruled that a maintenance contract may be terminated unilaterally, even without formal notice, if the behaviour of the creditor of the obligation is so serious that formal notice would have been useless.
A non-competition clause judged to be disproportionate to the protected interest
A non-competition clause contained in an IT subcontracting contract, even if limited in time and to a single client, has been declared null and void by the Versailles Court of Appeal (Cour d’appel de Versailles) on the grounds that it was disproportionate to the beneficiary’s legitimate interest, given the duration of the contract and the value of the service.
The revocation of a co-director (cogérant) is not justified if the alleged breach is attributable to all directors (gérants)
Where the bylaws of an SARL (société à responsabilité limitée) or an extra-statutory agreement do not define the duties of each of the co-directors, the shareholders may not dismiss one of them on the basis of the non-performance of obligations that could have been performed by the other co-directors, who remain in office.
A principal (mandant) who terminates a mandate without prior notice is not committing a fault
In a recent decision, the French Supreme Court (Cour de cassation) ruled that, under article 2004 of the French Civil Code, a mandate may be terminated by the principal at any time and without any reasons having to be given, and that abuse in the exercise of this right of termination can only be held if the person alleging it proves the principal’s intention to cause harm or culpable carelessness.
Real Estate
An action for declaration of the existence of a commercial lease (bail commercial) arising from the continued possession of the lessee at the end of the derogatory lease (bail dérogatoire) is not subject to the prescription period
A derogatory lease allows the parties to derogate from the protective but binding status of commercial leases, provided that the total term of the lease or successive leases does not exceed three years. At the end of this period, the lease is governed by the applicable regulation to commercial lease if the lessee is allowed to remain in possession of the premises. A recent decision by the French Supreme Court (Cour de cassation) answers the question regarding the prescription period applicable to an action to establish a commercial lease at the end of a derogatory lease. In this key decision, the French Supreme Court stated for the first time that an action to establish the existence of a commercial lease at the end of a derogatory lease, arising from the continued occupancy of the premises by the lessee, is imprescriptible.
Droit du travail / Employment law
Abandonment of post (abandon de poste): the French Ministry of Labour refuses to pronounce on the exclusivity of the presumption of resignation (présomption de demission) at this time
To answer the many questions raised by the introduction of this provision, the French Ministry of Labour published a Q&A. According to the French Labour Administration, the presumption of resignation would represent the only termination mechanism to be deployed in the event of abandonment of post. The procedure for dismissal for misconduct would therefore no longer be used.This interpretation, which goes beyond the letter of the law and the decree, has naturally caused confusion and led to the matter being referred to the Conseil d’Etat. Conscious of the uncertainties raised by its Q&A, the French Ministry of Labour decided to delete it from its website a few weeks later.
The personnel entry/exit record, essential for proving the impossibility of reclassification (impossibilité de reclassement)
In the event of a legal dispute, the employer making economic redundancies bears the burden of proving that it has effectively attempted to reclassify the employees without succeeding. To prove this, the employer must provide evidence of the steps it took (for example, by producing letters sent to companies of the group to which it belongs, and their replies), of the perimeter of its search if it belongs to a group, and of the absence of available positions and external recruitment at the time of redundancy, by producing the employees’ entry/exit register.
The right to accumulate paid leave during sick leave: alignment with the European jurisprudence
Through a series of decisions on 13 September 2023 that have already generated considerable concern, and after years of resistance from the French legislator, the French Supreme Court (Cour de cassation) has decided to align its position with the European jurisprudence: employees on sick leave should not have their paid leave entitlement calculated as a result of their absence.
STMicroelectronics condemned for gender discrimination
In several decisions delivered on 26 October, the Grenoble Court of Appeal (cour d’appel de Grenoble) condemned STMicroelectronics to pay more than 800.000 € to ten of its female employees for gender discrimination. The case concerned unequal treatment in terms of both pay and career development.
Compensation for occupation of the employee’s home for professional purposes
In a decision delivered on 15 November 2023, the Labour Division of the French Supreme Court (Cour de cassation) ruled on the conditions under which compensation for occupying an employee’s home for professional purposes may be recognised.The solution adopted is clear: it is up to the employer, who is contesting the payment of compensation for occupying the home for professional purposes, to demonstrate that he has actually made a professional premises available to the employee in order to carry out his activity. If no such premises have been made available, it is up to the judge to assess the amount of the occupancy indemnity due to the employee on this basis.Inversely, no compensation is due to the employee if he asks to work from home when a professional premises is actually made available to him by the employer.
IP/IT and communication
The architect’s moral rights apply to his work independently of the delivery of the material support to the project owner (maître de l’ouvrage)
The architect who submits his plans to the project owner retains a moral right to his personal and original work. The ownership of the material support does not confer to the owner of the “plans, tracings, drawings and studies” the right to dispose of them liberally without the agreement of their author.
Trademark exhaustion and burden of proof
It is up to the party claiming exhaustion of the right to establish, for each of the allegedly counterfeit goods, that they have been put on the market in the European Economic Area by the trademark owner or with his consent, unless there is a real risk of markets being partitioned by the trademark owner.
