2023-12-28 17:25:00
Habitat will not have saved the furniture. On December 28, the Bobigny court placed the furniture brand in liquidation due to its serious financial difficulties. The court recalls “that there is no possibility of developing a recovery plan” and that the situation was “irreparably compromised”, in particular “because of the absence of cash and the impossibility of using the brand “.
“The company is no longer generating any turnover, the stores are closed” and “the outstanding balance of undelivered customers who have paid a deposit is 9 million euros”, it is specified in the judgment. The company employs 315 employees.
How does a judicial liquidation take place? What is the difference with a receivership? Here’s what you need to know.
From judicial recovery to judicial liquidation
When a company finds itself in cessation of payments, and in the absence of a conciliation procedure, it must request the opening of a judicial recovery procedure, at the latest within 45 days following the cessation of payments, before the commercial court.
Once the procedure is opened, the company benefits from protection since any proceedings carried out by creditors are suspended. An economic and social assessment of the company is carried out during a so-called observation period. At the end of this, either a recovery plan is established, for a maximum duration of ten years, or a partial or total sale is decided. Unless recovery appears impossible, in which case judicial liquidation is pronounced.
Judicial liquidation
A judicial liquidation puts a definitive end to the company’s activity. A legal representative is appointed to be liquidator: he sells the assets (goods, equipment, buildings, lease rights, etc.) to pay the creditors, and dismisses the employees.
Employees’ employment contracts are terminated within a maximum period of 15 days following the judgment deciding on judicial liquidation. This period is extended to 21 days when a job protection plan is established. Claims arising from the termination of the employment contract (salaries, bonuses, allowances, contributions and social security contributions, etc.) are covered by salary guarantee insurance.
The judgment which opens the judicial liquidation also designates a judge-commissioner who is responsible for ensuring the smooth running of the procedure and the protection of the interests involved. Liquidation closes when the company has been able to repay all of its debts, or when it has sold all of its assets. From this point on, the company no longer exists as a legal entity.
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