Termination of an agreement without notice period due to the terminated party’s judicial claim for partial termination, is a brutal termination of established commercial relations #L442-6 I 5° Commercial Code

Termination of an agreement without notice period due to the terminated party’s judicial claim for partial termination, is a brutal termination of established commercial relations #L442-6 I 5° Commercial Code.

A company terminated the agreement with its communication agency without notice period because the latter had filed a judicial claim for partial termination. The terminating party alleged a loss of confidence.

However, an ordinary judicial action is not a legal abuse and a written notice with reasonable period should have been granted. 

For a 7-year commercial relation and a 80% dependency, the Court sets the reasonable notice period at 10-month and calculates the indemnity over the average margin of the last three years prior to the termination. The Court recalled that the damage is assessed at the date of termination without taking into account the subsequent events (Court of Appeal Paris, Pole 5, Section 4, 17 May 2017, No. 16/17988).

 

Frédéric Fournier
Partner

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