Seventeen years after the landmark Boot Shop decision (Plenary Assembly, October 6, 2006, n°05-13.255), the Commercial Chamber of the French Supreme Court (Cour de Cassation) appears determined to restore the full effectiveness of the principle of privity of contract.
In a noteworthy decision dated July 3, 2024 (n°21-14.947), the Commercial Chamber, relying on former Articles 1134 and 1165 of the French Civil Code, introduced a limitation to the principle according to which “a third party to a contract may rely, on the basis of tort liability, on a contractual breach where said breach has caused them damage.”
The Court now considers that, “so as not to defeat the legitimate expectations of the debtor,” the injured third party must be placed on an equal footing with the contracting party who suffers damage: both may now have contractual limitation-of-liability clauses invoked against them, whether or not they are parties to the contract.
This position is consistent with the provisions of the Civil Code governing contractual liability, which covers “only such damages as were foreseen or could reasonably have been foreseen at the time the contract was concluded, except where the non-performance results from gross negligence or wilful misconduct” (former Article 1150, now Article 1231-3 of the Civil Code - a principle that has been maintained through successive reforms, albeit applied sparingly by the courts).
One question remains: although the general principle was reaffirmed by the Plenary Assembly in 2020, will the other chambers of the Cour de Cassation adopt the nuance recently introduced by the Commercial Chamber?
Written by Julien Jorand