Different interpretationThe Court of cassation has just overrule

In a judgment of 11 July 2006 (1), the Court of cassation has judged that a Commissioner for employee and partner of an auditing company accounts could be punished personally by the authority of the financial market (AMF) while he acted in the name and on behalf of the company. The question is whether this case is likely to affect the conditions of game of the civil liability of sales professionals.

The facts related to a publicly traded company, in liquidation, which was the subject of an investigation by the AMF on its financial information. In this framework, AMF had given financial penalties against a Commissioner to the individual accounts, while the owner of the audit mandate was a company of which he was an employee. Before then, the Court of appeal of Paris found that the auditor acting on behalf of and on behalf of the company could not be subject to penalty (2).

Different interpretation

The Court of cassation has just overrule. Thus, while the Court of Appeal found that "the subject of likely to be affected market regulation law" could be the "holder of the mandate", i.e. in the present case an auditing company, the High Court made a different interpretation of the monetary and financial Code which aims in article l. 621-15 II c "any person". Then the Court of cassation considered that "the auditor certifying the accounts on behalf of the society of Commissioners to the accounts he is a member acts as partner, shareholder or officer of this company, and not as an employee, just important that it be linked in the company of Auditors by a contract of employment".

The position of the Court of cassation ignored so the existence of the unincorporated society of Commissioners accounts, which cannot therefore preclude the prosecution of AMF against professionals in the figure in society. But the same approach, about a sanction AMF it with a quasi-judicial disciplinary character could be extended to professional liability actions carried out directly before the courts Indeed, whereas the Court of cassation is never ruled on this issue, several jurisdictions have recently opted, in this case, instead, for the exclusion of any prosecution against the professional net who is in the holding company of the mandate of the Auditors (3), for the benefit of an action exclusively directed against the.

Little impact

The principle by the High Court does not appear to be likely to come to contradict this solution. Indeed, as the Court of cassation, taking in this regard the provisions of article l. 822 - 9 of the Code of trade (4) the auditor is "as partner, shareholder or officer" of the society of which he is a member. Accordingly, it is this quality that liability must be sought, whether he is also holder of a contract of employment. Liability civil professional, classic jurisprudence leader responsibility must therefore be applied, which requires proof of a detachable fault of functions, to take action, this fault is defined as being that of a particular severity, incompatible with the normal exercise of the functions, committed intentionally (5).

However, it is already on this criterion of the absence of detachable fault functions of the external auditor that the courts declare inadmissible actions against Auditors acting on behalf of the society in which they exercise. The judgment of the Court of cassation avoir here should therefore not have impact on this solution and remain confined to the AMF sanctions.