In a ruling handed down on September 12, 2024, the French Supreme Court ruled on the question of the application of a prior conciliation clause in the event of different legal proceedings being brought (in summary proceedings and then on the merits).<\/p>\n
In the case at hand, the dispute concerned the deed of sale of a pharmacy business, which included a clause \u201cproviding that all disputes relating to the interpretation and performance of the agreement must, prior to any legal proceedings, be submitted to conciliators <\/i>\u201d.<\/p>\n
Following the failure of an initial conciliation, the sellers of the business brought a summary action before the President of a Commercial Court, seeking an order that the buyer perform its contractual obligations. Their request was rejected by the lower court.<\/p>\n
Subsequently, the sellers summoned the buyer to pay them damages to compensate for their contractual breaches.<\/p>\n
Before the Court of Appeal, the buyer argued that the conciliation procedure had not been initiated prior to the proceedings on the merits, given that the second proceedings initiated by the sellers related to a dispute arising from the performance of the transfer contract, distinct from the claims made in summary proceedings. The Court of Appeal upheld the claim for inadmissibility.<\/p>\n
The Court of Cassation upheld the decision on the grounds that: \u201c[i]t arises from article 1134, fisrt<\/i>\u00a0paragraph, now 1103 of the Civil Code, and article 122 of the Code of Civil Procedure, that a clause in a contract instituting a compulsory conciliation procedure prior to referral to the court constitutes an inadmissibility which is binding on the court if the parties invoke it <\/i>\u201d.<\/p>\n
This ruling calls for the utmost caution in the implementation of prior conciliation clauses: the clause providing for conciliation prior to \u201cany proceedings\u201d must be respected each time a new action is brought. This is the case when an action in summary proceedings is followed by an action on the merits.<\/p>\n