Commercial Division, Opinion No. 25-70.020 of 10 December 2025
The request was put to the French Supreme Court as follows: “How do the provisions of Article L. 526-1 et seq. of the Commercial Code (protection of the main residence from business creditors) interact with those of Article L. 526-22 et seq. and L. 681-1 et seq. of the Commercial Code (involving the realisation of personal assets), and therefore does the court-appointed liquidator (liquidateur judiciaire) have the power to ask the supervising judge (juge-commissaire) to sell the main residence on behalf of the creditors whose security is the personal estate?”
Dear sole traders, the court-appointed liquidator can now sell your main residence in dual-estate proceedings (covering both business and personal assets).
People wrongly believe that the main residence is a stronghold; they reassure themselves with one word: exempt from seizure. Since 2022, the boundary has become even clearer: two estates, two pools of security, two logics that coexist (but sometimes clash) within the same proceedings.
It is against this ambiguous backdrop that the French Supreme Court’s opinion of 10 December last[1] comes in. This opinion, which makes up for a missed opportunity (the Court having declared inadmissible a first request for an opinion on the same issue a few months earlier[2]), makes a decisive contribution to the workings of insolvency proceedings: where the proceedings cover both estates, those in charge of realising the main residence are no longer the personal creditors, but the officeholder appointed in the proceedings, under the authority of the supervising judge. And the sale, if it takes place, has only one beneficiary: the personal liabilities.
This eagerly awaited opinion on the interplay between the exemption of the main residence from seizure and the new dual-estate proceedings for sole traders stems from a question raised by the supervising judge of the Saint-Brieuc Commercial Court (tribunal des activités économiques), which explicitly concerned the interplay between the protection of sole traders’ main residence[3] on the one hand, and the regime involving the realisation of personal assets[4], on the other.
The question literally put was as follows: does the court-appointed liquidator have the power to ask the supervising judge for authorisation to sell the main residence on behalf of the creditors whose security is the personal estate?
I. The framework: exemption from seizure by business creditors, not general immunity
Before turning to the mechanics of the opinion, an obvious point that is sometimes misunderstood must be recalled: the protective provision has never been a universal wall.
Since the 2015 Macron Act, Article L. 526-1 of the Commercial Code has made the main residence automatically exempt from seizure by creditors whose rights arise in connection with the business activity. This protection in principle sometimes fuels the idea of a general lock.
To be entirely accurate, however, the protection applies to debts arising after the entry into force of the Macron Act, namely 8 August 2015, and in connection with the person’s business activity. As regards the sole trader’s business creditors, the protection then covers rights in the property in which the main residence is located, which may be full ownership, usufruct, bare ownership or undivided rights.
Conversely, automatic exemption from seizure cannot be relied on against the debtor’s personal creditors. Thus, even before the French Supreme Court’s opinion, the main residence was not by nature beyond reach: the Advocate General[5] expressly points this out, stressing that business protection does not prevent seizure by personal creditors: “The protection of the main residence (…) does not rule out the possibility for personal creditors (…) to seize this asset.”
In other words, the protection operates as a relative unenforceability; it prevents the main residence from serving as the basis for enforcing business debts, but it does not remove it from the security for personal debts where the situation warrants collective treatment of the personal estate.
In practice, therefore, as sole traders you are protected against seizure of your main residence by your business creditors whose rights arose after 8 August 2015; however, in proceedings concerning your personal estate, your personal creditors still have the possibility of seizing that asset.
Once the scope of the protection has been set out, the real issue emerges: the place of the personal right of recourse within insolvency proceedings.
II. The point of difficulty: reconciling the need to realise assets for the benefit of personal creditors with the collective interest of creditors
In addition to the exemption of the main residence from seizure by business creditors recognised since 2015, sole traders have been granted, since an Act of 14 February 2022 (and automatically), two separate estates: their personal estate on the one hand, and their business estate on the other, with each category of creditors being assigned a coherent primary pool of security, and the basis of that security being made clear.
Accordingly, all assets not included in the business estate (those used for the business activity) form the personal estate.
From a legal standpoint, to benefit automatically from this dedicated business estate, the claims must post-date 15 May 2022 on the one hand, and the sole trader must be registered with the Trade and Companies Register (RCS) or the National Business Register (RNE) on the other.
For almost four years now, sole traders have automatically held two estates: one personal and one business. Accordingly, only business creditors have a general right of recourse (droit de gage général) against the assets of the business estate[6], and conversely only personal creditors have a general right of recourse against the assets of the personal estate.[7]
Difficulties nevertheless arose where insolvency proceedings covered both estates, since the court-appointed liquidator is structurally bound to act within a collective framework. These difficulties stemmed from a long-standing and consistent line of case law, which the 2022 reform would make difficult to sustain.
The French Supreme Court had indeed held, since a decision of 28 June 2011[8], that property exempt from seizure did not form part of the creditors’ common pool of security where some of them retained the right to seize the property while the exemption could be relied on against the others. From this premise, the Court had inferred that the liquidator could not take possession of the property: authorising the sale for the benefit of personal creditors alone would, in this logic, have amounted to an ultra vires act (excès de pouvoir)[9], since the collective interest was understood as the interest of all creditors, without distinction. The logical consequence was drawn by the decision of 4 April 2016[10]: a creditor against whom the exemption from seizure could not be relied on (that is, a personal creditor) could act individually against the property, independently of the rules of the insolvency proceedings. This dual mechanism was again forcefully reaffirmed by the French Supreme Court on 13 April 2022[11], only a few weeks before the entry into force of the Act on sole traders, confirming that the collective interest of creditors, as regards property exempt from seizure, meant the interest of all creditors without distinction. This procedural lock was consistent with a monolithic conception of the common pool of security. Thus, in this logic, where only some creditors could seize a property, the property could not be fully seized, and the officeholder could not realise it in the name of an interest common to all.
As explained by Ms Déborah Coricon, junior judge (conseillère référendaire) at the French Supreme Court, in her report on the opinion, the difficulty stems from the way the judges of the Quai de l’Horloge have, over the years, constructed the very notion of collective interest: it means all creditors.
The 2022 reform, however, has made this reasoning difficult to sustain in dual-estate proceedings, because it establishes two separate general pools of security. It follows that the phrase “outside the common pool of security” loses its explanatory force, because the property now falls within the common pool of the relevant estate and can therefore be seized through the in rem effect of the proceedings where the personal estate is within their scope.
This is where the opinion is structural: it does not say that personal creditors can seize the main residence; they already could. It says that, where proceedings have been opened over both estates (business and personal), the court-appointed liquidator becomes the legitimate procedural actor for realising the personal estate, even if solely on behalf of the personal creditors.
Accordingly, in its opinion the French Supreme Court does not create a new right; it reorganises a power. It does not alter the nature of the security; it changes how that security will be enforced and, above all, by whom.
III. The real change: who acts, how, and for which liabilities?
The answer is now clear and can be summed up in one sentence: yes, “the supervising judge may, on application by the liquidator, authorise the sale of the debtor’s main residence on behalf of the creditors whose security is the debtor’s personal estate.”
The conceptual contribution of the opinion is to accept that the collective interest may be assessed by estate. The opinion of 10 December 2025 ends the deadlock described above by accepting, in substance, segmented collective representation.
Thus, in dual-estate proceedings, the sale may now be ordered, but the proceeds of sale will be used solely to pay the category of personal creditors. Mr Jean-Pierre Rémery, Senior Judge (Conseiller doyen) of the Commercial, Financial and Economic Division, puts it as follows: “the liquidator may be authorised to sell the main residence […] but only on behalf of the creditors whose security is the personal estate”.[12]
It is this new mechanism that changes things very concretely in practice: instead of a race between personal creditors each acting on their own, the opinion validates a mechanism whereby the realisation of the asset can be managed by the officeholder, with judicial authorisation and a distribution in line with the right of recourse attached to the personal estate.
IV. Less a question of the “right to seize” than of the procedural “channel”
For sole traders, the practical impact should therefore be restated as follows: the main residence was already exposed to personal creditors, but the opinion establishes the possibility, in proceedings opened over both estates, of channelling that realisation through the court-appointed liquidator, with the proceeds allocated solely to personal liabilities.
This structure aims to neutralise isolated individual actions by converting a scattered seizure into a structured and supervised realisation.
In practice, therefore, the question to ask is no longer: “can my personal creditors obtain payment from my main residence?” (because yes, they will be able to in any event) but rather: “does my case fall within proceedings covering both estates, enabling the liquidator to realise my main residence?”
Ultimately, the opinion does not change the landscape: it changes the flow. And in insolvency proceedings, the flow of powers matters as much as the destination of rights.
Caution is therefore called for: in dual-estate proceedings, the court-appointed liquidator may take charge of your main residence (even if it is covered by the exemption from seizure by business creditors) in order to sell it and, consequently, pay your personal creditors himself.
V. Going further: where is the boundary with personal over-indebtedness proceedings?
The Advocate General[13] develops an analogy with over-indebtedness proceedings (surendettement) that is not merely a rhetorical device; it serves to lock in the consequence of including the personal estate in the liquidation. By likening the divestment mechanisms of Book VI of the Commercial Code to those of over-indebtedness proceedings under Book VII of the Consumer Code, he recalls a rule of method: if the personal estate is included in the proceedings, the court-appointed liquidator becomes the natural actor for its realisation, not out of expediency, but out of organic consistency. To quote the Advocate General: “whether the debtor’s situation is viewed from the perspective of personal over-indebtedness or from that of the insolvency proceedings under Book VI, in the event of liquidation the rule is the same: he is legally divested of his assets”.
The analogy leads to the theoretical core: the notion of collective interest must be read estate by estate. In a two-estate system, maintaining a monolithic conception of the collective interest as the interest of all creditors without distinction would lead to paralysis.
We now have this clarification from the French Supreme Court: the collective interest remains, but it varies according to the estate concerned.
It is this reclassification, made necessary by the reform, that explains why the sale of the main residence, where it forms part of the personal estate, is legitimate on behalf of personal creditors alone, without betraying either the exemption of the main residence from seizure or the logic of insolvency proceedings.
[1]French Supreme Court (Cour de cassation), Commercial Division, 10 December 2025, Opinion No. 15025 B, appeal No. 25-70.020
[2]Com., opinion, 21 May 2025, No. 25-70.008 F-B. The request had been declared inadmissible because the property was held in undivided ownership and because of the very wording of the question put.
[3] L. 526-1 et seq. of the Commercial Code
[4] L. 681-1 et seq. of the Commercial Code
[5] Mr de Monteynard, Opinion of the Advocate General on referral No. 15025 (B)
[6] L. 526-22, paragraph 4 of the Commercial Code
[7] L. 526-22, paragraph 2 of the Commercial Code
[8]Com., 28 June 2011, No. 10-15.482 P.
[9] J. Vallasan, La notion d’intérêt collectif vue par la Chambre commerciale de la Cour de cassation, BJE May 2016
[10]Com., 4 April 2016, No. 14-24.640 P.
[11]Com., 13 April 2022, No. 20-23.165 FS-B.
[12] Jean-Pierre Rémery, “Procédure bi-patrimoniale de l’entrepreneur individuel et vente de la résidence principale”, Dictionnaire permanent Dalloz, Éditions Législatives (VP Dalloz), 14 January 2026
[13] Mr de Monteynard, Opinion of the Advocate General on referral No. 15025 (B)
