Common law formalism transposable to suretyship
First, it should be remembered that first and foremost, the bond is a contract. In doing so, it takes on a consensual nature, which means that it is only perfected by the exchange of the consents of the two parties, as provided for in article 1134 of the Civil Code.
The contract of suretyship is therefore, from this point of view, subject to no particular formalism with regard to common law, except that of being a consensual contract.
Secondly, the suretyship is a personal surety subject to a common law formalism provided for by the Civil Code provided for by article 2292 of the Civil Code.
This article provides: “the suretyship is not presumed; it must be express, and it cannot be extended beyond the limits within which it was contracted”.
On reading this text, the suretyship must simply be explicit, without being subject to any particular form. The requirement of a writing is not required.
It should nevertheless be remembered that in contractual matters, the primary purpose of formalism is to enable a party who invokes the existence of a contract to provide proof thereof.
As a result, article 1341 of the Civil Code departs from the rule of consensualism by indicating that any commitment greater than €1500 must be the subject of a written ad probationem (in order to provide proof). However, this requirement is not a cause of nullity of the commitment.
With regard to common law, the suretyship is not in principle subject to any truly binding formalism, likely to lead to its nullity in the event of non-compliance. However, because of the (serious) consequences that this commitment can have for the surety, the legislator has subjected the suretyship to a formalism of its own and which the law of August 1, 2003 has reinforced.
The particular formalism specific to the surety
It is appropriate to study this particular formalism through article 1326 of the Civil Code first, then to consider the rules introduced by the Consumer Code.
The requirement of handwritten mentions ad probationem (on a probationary basis)
Article 1326 of the Civil Code provides that the commitment of the surety must be recorded in a title which includes his signature as well as the written mention by himself, of “the sum or the quantity in words and in figures. In the event of differences, the private deed is valid for the sum written in full”.
This formalism serves to attract the person making the commitment to the importance and seriousness of his commitment. Jurisprudence has long hesitated as to the scope to be given to this formalism. If the Court of Cassation was able to require sureties to affix statements specifying the scope of their commitment on pain of nullity of the guarantee, this ad validitatem requirement is no longer (since a reversal made by the Court of Cassation 1st civ. of Nov. 15, 1989) that a requirement ad probationem.
The high court considered until recently that the requirements relating to handwritten notes were no more than rules of evidence (Court of Cassation, Com, 19 and 26 June 1990, 25 May 1993), so that the incomplete guarantee document was simply irregular and no longer invalid.
This jurisprudential construction is today called into question by the law of August 1, 2003 in terms of sureties subscribed by private deed by natural person sureties for the benefit of professional creditors.
The requirement of handwritten mentions ad validitatem (necessary for validity)
This law marks a return to formalism. The handwritten notes are no longer required only as proof but as validation of the commitment. It is appropriate to briefly recall the field of application of these articles inserted by the law of August 1, 2003 in the Consumer Code.
The new articles L341-2 and following apply only to suretyship (and not to other real sureties), only apply to sureties subscribed by private deed (which excludes suretyship by authentic deed) and do not concern only natural person sureties (and not legal persons, for which the legislator did not intend to confer the same protection as that granted to natural persons). In addition, the law applies to sureties, whether lay or knowledgeable.
These texts are only a retranscription of articles L313-7 and L313-8 of the Consumer Code, hitherto confined to sureties for consumer credit and mortgage credit.
Article L341-2 expressly provides that the natural person must, on pain of nullity of his commitment, precede his signature with the following handwritten note and only this one. “By standing surety for X, within the limit of the sum of (…) covering the payment of the principal, interest and, where applicable, penalties or late payment interest and for the duration of (…), I undertake to repay to the lender the sums due on my income and my assets if X does not satisfy them himself”.
The guarantor who undertakes jointly and severally must also reproduce the following statement provided for in article L341-3 of the Consumer Code: "By waiving the benefit of discussion defined in article 2021 of the Civil Code and by obliging me jointly and severally with X, I undertake to reimburse the creditor without being able to demand that he sue X beforehand”.
The mandatory nature of these particulars has a major consequence: the suretyship can no longer be indefinite, neither in its duration nor in its amount (omnibus suretyship). Failure to comply with these terms will be penalized by the relative nullity of the bond, only the parties can therefore invoke it. The question nevertheless arises as to whether the judge will be able to raise the nullity ex officio.
In addition to being determined, article L341-4 of the Consumer Code requires that the amount of the surety be proportionate to the assets of the surety on the day it is called. If the disproportion is proven, the surety will be fully discharged from his obligation.