A ship repair yard has refitted a harbour service vessel belonging to a shipowner in Saint-Malo. The invoice remains unpaid. Before the yard can act, the shipowner is placed in receivership (redressement judiciaire). Can the yard still arrest the vessel?
The stay of proceedings
The judgment opening safeguard, receivership or judicial liquidation proceedings interrupts or prohibits any legal action by pre-existing creditors seeking payment of a sum of money, and stays all enforcement proceedings (Article L. 622-21 of the French Commercial Code). A protective arrest of a ship made against the debtor after the opening judgment is therefore, in principle, ruled out. One already under way runs up against the stay of proceedings.
The rule concerns the debtor in insolvency proceedings. If the claim can be attached to another person, such as the owner of the vessel or a guarantor, the position is different and must be analysed.
Filing within the time limit
Filing a proof of claim is the only route to payment. It is addressed to the creditors’ representative (mandataire judiciaire) within two months of publication of the opening judgment in the BODACC (the official gazette of civil and commercial notices); the time limit is extended by two months for creditors residing outside metropolitan France (Article R. 622-24 of the Commercial Code). A foreign supplier, a competing shipowner or a P&I club therefore has four months.
The proof of claim states the amount of the claim, its due dates, the security attached to it and the liens relied on. Maritime liens and ship mortgages must be mentioned: they are what will give the creditor its ranking on the proceeds if the vessel is sold.
Relief from foreclosure
A creditor that has missed the deadline is excluded from distributions unless it obtains relief from foreclosure (relevé de forclusion). The application must be made within six months of publication of the opening judgment, or from the date on which the creditor could not have been unaware of its claim (Article L. 622-26 of the Commercial Code). The creditor must show that its failure was not its own doing, or that it results from the debtor’s omission from the list it was required to provide.
What happens to the vessel
The vessel forms part of the debtor’s assets. In receivership, it may be retained under a plan or sold. In liquidation, it is sold. Lienholders and mortgagees exercise their rights over the proceeds, according to their ranking.
What the firm checks first
- The date and publication of the opening judgment.
- The exact debtor: owner of the vessel, shipowner, charterer.
- The liens and security interests to be asserted.
- The filing deadline, extended or not.
- Whether a claim for recovery of property is available if the creditor owns an asset held by the debtor.
For the firm’s services, see Maritime litigation.
Further reading
- Forcing the sale of an arrested ship: enforcement and judicial auction
- Ship arrest: the deadline to bring the main action that creditors forget
- Crew abandoned in a French port: wages, repatriation and financial security
This analysis is part of the firm’s work in maritime law.
Frequently asked questions
Can a ship belonging to a shipowner in receivership be arrested?
Not for a claim arising before the opening judgment: legal actions and enforcement measures are stayed (Article L. 622-21 of the Commercial Code).
What is the time limit for a foreign supplier to file a claim against a French shipowner?
Two months from publication in the BODACC, extended by two months for creditors established outside metropolitan France (Article R. 622-24 of the Commercial Code).
What if the deadline has passed?
Apply for relief from foreclosure within six months (Article L. 622-26 of the Commercial Code).