NEWS

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23-05-2018

 

The personal liability of corporate officers before the criminal courts is not conditional on proof of a fault separable from their functions 

 

The concept of fault separable from functions allows a third party, whether co-contractor or partner of the company, to engage the personal liability of a manager or corporate officer in order to obtain compensation for faulty acts within the company. society.

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Since a judgment of the Commercial Chamber of the Court of Cassation in 2003, it is accepted that the personal liability of a corporate officer can only be engaged when he "intentionally commits a fault of a particular gravity incompatible with the exercise normal des functions sociales ” (Cass. com., May 20, 2003, appeal no. 99-17.092). Taking these strict criteria into account, the notion of separable fault constitutes a safeguard against the questioning of the personal civil liability of corporate officers.

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In this respect, it is traditionally accepted that an intentional criminal offense constitutes a separable fault likely to engage the personal civil liability of the corporate officer.

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In a judgment of April 5, 2018 (Cass. crim., April 5, 2018, appeal no. 16-87.669), the Criminal Division of the Court of Cassation seems to abandon the requirement to characterize a fault separable from social functions in order to retain liability of an executive before the criminal courts.

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In this case, a company resold three vehicles without first paying the price to the initial seller, in violation of a retention of title clause. The seller argued that the company and its manager should be condemned for breach of trust before the criminal judge. They were acquitted in criminal proceedings. In terms of civil interests, the leader was still ordered to compensate the owner of the vehicles. In the cassation appeal, the manager challenged his civil award of damages on the grounds that the Judges should have demonstrated how he had intentionally committed a particularly serious fault incompatible with the normal exercise of his duties as manager.

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The Criminal Division dismissed the manager's appeal as follows: "  the grievance based on the failure to establish a fault of a particular gravity incompatible with the normal exercise of social functions constituting a fault separable from the functions of corporate officer is inoperative, the judges not having to explain the existence of such a fault to characterize a civil fault demonstrated from and within the limits of the facts subject of the prosecution_cc781905-5cde- 3194-bb3b-136bad5cf58d_”.

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The solution of the Criminal Chamber is very favorable to the victim since the latter can now engage the personal civil liability of the manager before the criminal courts without a separable fault being characterized, even though the conditions of criminal liability do not are not met !

 

 

Roland Rinaldo, lawyer, Cabinet ARTLEX Nantes

Jean Orieux, trainee lawyer, Cabinet ARTLEX Nantes

 

judgment of April 5, 2018 of the Criminal Chamber of the Court of Cassation, appeal no. 16-87.669, judgment of May 20, 2003 of the Commercial Chamber of the Court of Cassation, appeal no. 99-17.092, intentional criminal fault, separable fault corporate functions, personal civil liability of executives and corporate officers