Proof of Claim and Unseizable Main Residence

Proof of claim and unseizable main residence: is the creditor protected against limitation until the proceedings are closed?

A creditor between two worlds: the paradoxical position of the lender faced with statutory unseizability

Where a sole trader (entrepreneur individuel) placed in compulsory liquidation (liquidation judiciaire) financed his or her main residence with bank loans, the lending institution finds itself in a singular legal position. On the one hand, since the Act of 6 August 2015 known as the "Macron Act", the main residence is by law unseizable by the entrepreneur's business creditors (Article L. 526-1, paragraph 1 of the French Commercial Code). On the other hand, that same lender, which financed the acquisition of the property, can legitimately argue that this unseizability cannot be set up against it, since the loan was precisely used to finance the home.

This is exactly the scenario decided by the Commercial Chamber of the Cour de cassation in a judgment of 4 February 2026 (Cour de cassation, Commercial Chamber, 4 February 2026, F-B, No. 24-20.467), published in the Bulletin. The question was both technical and of considerable practical importance: does a creditor who files a proof of claim (déclaration de créance) in collective insolvency proceedings (procédure collective) benefit from the limitation-interrupting effect attached to that filing, including in order to exercise later its right of enforcement over the unseizable main residence? And if so, until what date does that effect extend?

The answer of the highest court is clear: yes, the limitation-interrupting effect benefits the creditor who has filed a claim, and it runs until the proceedings are closed. This solution departs in part from earlier precedents on the duration of that effect.

The legal framework: proof of claim, unseizability and limitation

Statutory unseizability of the main residence: a relative shield

Since the Act of 6 August 2015, every sole trader benefits, by operation of law and without any formality, from the unseizability of his or her main residence as against business creditors (Article L. 526-1, paragraph 1 of the French Commercial Code). This protection is said to be "statutory" because it operates automatically, without requiring a notarial declaration. It is a major development compared with the previous regime, which required a formal declaration before a notary.

This unseizability is not, however, absolute. It applies only to creditors whose rights arose in connection with the entrepreneur's professional activity. By contrast, a creditor whose claim was precisely used to finance the acquisition of the main residence is not covered by this protection: unseizability cannot be set up against it. In other words, the credit institution that granted a mortgage loan for the purchase of the home keeps its right of enforcement over that property.

The proof of claim and its limitation-interrupting effect

When collective proceedings are opened, every creditor must file a proof of claim in the liabilities in order to hope to be paid out of the assets included in the proceedings (Article L. 622-24 of the French Commercial Code). This filing has a limitation-interrupting effect, now expressly enshrined in Article L. 622-25-1 of the French Commercial Code, introduced by the Ordinance of 12 March 2014 (Ordinance No. 2014-326). That provision states that the proof of claim "interrupts limitation until the proceedings are closed".

Before this codification, the solution rested on treating the proof of claim as equivalent to a legal claim (Cour de cassation, Plenary Assembly, 4 February 2011, No. 09-14.619). The 2014 Ordinance therefore anchored in the text a rule that was already case law, while clarifying its contours.

The two-year limitation period applicable to consumer credit

In this case, the lender's claim for repayment was subject to the two-year limitation period provided for by Article L. 218-2 of the French Consumer Code, which applies to actions brought by professionals against non-professionals or consumers. This particularly short period made the question of the interrupting effect of the proof of claim decisive for the lender. On the borrower's reliance on this limitation period against the bank, see our analysis of the combination of limitation and set-off in mortgage lending.

The judgment of 4 February 2026: a solution predictable in principle, uncertain in scope

The facts: a lender who sued too late?

A credit institution had granted a sole trader two loans intended to finance the acquisition of his main residence. The debtor was placed in compulsory liquidation in February 2018, and the lender filed its proof of claim in April 2018. In December 2020, more than two years after that filing, the institution brought proceedings against the debtor for payment of the sums remaining due.

The lower courts declared these claims inadmissible as time-barred. Their reasoning was that the proof of claim had set running the two-year period of Article L. 218-2 of the French Consumer Code, which had therefore expired on the day of the summons in December 2020. The Cour de cassation set that judgment aside.

The solution: the interrupting effect benefits the creditor entitled to seize the property

Citing Articles L. 622-25-1 and L. 641-3 of the French Commercial Code, the highest court states that the limitation-interrupting effect attached to the proof of claim benefits the creditor against whom the statutory unseizability of the main residence cannot be set up, where that creditor, holding a right of enforcement over the property, acts against the debtor to have its claim and its due date established.

That effect extends, the judgment specifies, until the proceedings are closed.

The logic of the solution may be surprising at first sight. Indeed, the unseizable property does not form part of the base of the collective proceedings: it is excluded in principle. The rules of collective discipline – stay of individual actions (Article L. 622-21 of the French Commercial Code), prohibition of payments (Article L. 622-7 of the French Commercial Code) – should therefore not, logically, apply to a creditor acting on an asset outside the proceedings. The scope of this rule and the steps that remain open to the creditor are dealt with separately in our article on the stay of individual actions.

By symmetry, the proof of claim, which is not a condition for acting on that external asset, should not necessarily have any effect on the limitation period relating to the right of enforcement over the property. Some authors had noted this (P. Cagnoli, Prescription et procédures collectives, in Régime général des obligations et droit des entreprises en difficulté, Dalloz, 2025, p. 93, esp. p. 101; J.-Cl. Procédures collectives, Réalisation de l'actif, by P.-M. Le Corre, fasc. 2707, No. 22).

But the Cour de cassation takes a different reading. It observes that even a creditor holding a right of enforcement over the unseizable property remains subject to the procedural rules of collective discipline: it may initiate a seizure only on the basis of an enforceable title confined to establishing the existence, amount and due date of its claim – without being able to obtain an order for payment (Cour de cassation, Commercial Chamber, 7 October 2020, No. 19-13.560). It is this partial subjection to the personal effects of the proceedings that justifies the proof of claim having a limitation-interrupting effect, including for the right of enforcement over the property outside the proceedings.

The open question: until when does the interrupting effect run?

A change of basis with uncertain consequences

The most delicate contribution of the judgment concerns the duration of the interrupting effect. In two earlier decisions concerning creditors in a similar situation (Cour de cassation, Commercial Chamber, 12 July 2016, No. 15-17.321; Cour de cassation, Commercial Chamber, 8 February 2023, No. 21-17.763), the Cour de cassation had held that this effect extended until the date of the decision ruling on the application for admission of the claim to the liabilities – and not until the proceedings were closed. This shortening of the interrupting effect was justified by the absence of any impossibility for the creditor to act on the property outside the proceedings.

In the judgment of 4 February 2026, the highest court places itself directly on the basis of Article L. 622-25-1 of the French Commercial Code, applicable to proceedings opened after the Ordinance of 12 March 2014, and holds that the proof of claim interrupts limitation until closure. This change of basis raises a question: is it a reversal of case law, or merely a distinction according to whether the contract predates or postdates the 2014 Ordinance?

Academic opinion is divided. A first reading suggests distinguishing according to the applicable statutory regime. A second, bolder reading sees a general reversal: from now on, whatever the applicable regime and whatever the relative unseizability measure at issue, the interrupting effect would systematically run until the proceedings are closed.

A potential extension beyond cases of unseizability alone

The judgment also opens a wider perspective. Its logic could extend to any situation in which a creditor has both a right to be paid out of assets included in the proceedings and a right of enforcement over assets excluded from them. One thinks in particular of the business creditor of a sole trader whose estate has been split since the Act of 14 February 2022: holding a general right of pledge extending to the personal estate, that creditor could benefit from the interrupting effect until the closure of collective proceedings concerning the business estate alone (Article L. 681-2, II of the French Commercial Code).

Practical consequences for each party

For the creditor – lending institution or otherwise

The decision is favourable and should lead to a review of practices. A creditor holding a mortgage loan granted to a sole trader whose main residence is unseizable must systematically file its proof of claim in the collective proceedings, even if it intends mainly to exercise its right of enforcement over the property. This filing gives it the protection of the limitation-interrupting effect until closure, sparing it from having to multiply interrupting steps throughout the proceedings.

In practice, this solution is particularly welcome where the proceedings are long – as is often the case in compulsory liquidation – and the applicable limitation period is short, such as the two-year limitation period of Article L. 218-2 of the French Consumer Code.

For the debtor

The sole trader in compulsory liquidation will no longer be able to rely on the short limitation period to neutralise the lender's rights over his or her main residence, once the lender has duly filed its proof of claim. The protection of statutory unseizability, already limited by its inapplicability against the mortgage lender, is therefore not further protected by the operation of limitation. The debtor should be informed of this as soon as the proceedings are opened, in order to avoid any surprise.

For the court-appointed liquidator

The liquidator must identify, among the creditors who have filed claims, those who may have a right of enforcement over assets outside the proceedings. This identification determines the information to be given to those creditors and the coordination of asset realisation operations.

Identified litigation risks

Several lines of dispute may crystallise around this decision.

On the duration of the interrupting effect. The uncertainty in the case law as to whether the effect runs until closure or only until the decision admitting the claim is an immediate source of litigation. The opponents of a lender enforcing its security late might try to argue that the earlier solution still applies, limiting the interrupting effect to the date of admission.

On proof that unseizability cannot be set up. To benefit from the interrupting effect on the terms described in the judgment, the creditor must still show that statutory unseizability is indeed inapplicable against it – which requires establishing the direct link between the financing granted and the acquisition of the main residence.

On the limitation of the action to realise the property. Even if the interrupting effect is recognised until closure, the question of the limitation of the action to realise the property after closure remains entirely open. The creditor will have to act promptly after closure so as not to be exposed once again to a plea of inadmissibility.

On the extension to the split estates of the sole trader. Under the regime resulting from the Act of 14 February 2022, the delimitation of the assets subject to the proceedings and those excluded from them may give rise to debate on the applicability of the solution in the judgment of 4 February 2026.

Legal strategies and recommendations

For the credit institution that financed the acquisition of an unseizable property: systematically file the proof of claim in any collective proceedings opened against the debtor, even if the main intention is to act on the property outside the proceedings. This filing costs nothing, and it gives valuable protection against limitation.

To anticipate the uncertainties on the duration of the effect: keep independent interrupting steps (formal notice, application in summary proceedings, application for a finding) at regular intervals during the proceedings, so as not to be exposed to the risk of a restrictive interpretation of the duration of the interrupting effect.

For the debtor and his or her advisers: do not build a defence strategy on the short limitation period if the creditor has filed its claim. The judgment of 4 February 2026 makes this defence very fragile, even ineffective.

For practitioners assisting sole traders: the coexistence of the protection of statutory unseizability and the mortgage lender's right of enforcement must be explained clearly as soon as the proceedings are opened. An overall strategy for paying creditors must be built taking account of this duality of regimes.

Conclusion

The judgment of 4 February 2026 forms part of a consistent line of case law: simplifying the application of the limitation-interrupting effect by adopting a uniform rule, independent of the nature of the asset on which the creditor intends to exercise its rights. The proof of claim interrupts limitation – full stop. This logic of simplification, welcomed by some academic commentators at a time when insolvency law is considered too complex (Conseil d'État, Note for the simplification study on Book VI of the Commercial Code, 2024), has however a downside: it creates a transitional uncertainty about the exact duration of that effect for situations predating the 2014 Ordinance. Pending clarification by the courts, prudence requires treating this judgment as a warning signal and acting accordingly, both at the stage of the proof of claim and during the proceedings

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