Despite the drop in ratesget a real estate loan remains complicated. Requesting subsidized loans (1 to 2% for part of your credit) from your bank is a solution. Benefit from a a helping hand from your bossis another. But this help welcomein these unstable times, can be costly for employees who request it. Because it carries a risk: having to repay your debt in the event of leaving the company.
A principle, although planned in advance between the two parties, that an employee, dismissed by Axa Assurance, challenged in court. The Court of Cassation ruled in favor of the employer. A company can grant a loan to an employee but if he leaves the company through dismissal or resignation, the employee may find himself obliged to immediately repay the balance of the loan in addition to compensation, ruled the Court of Cassation in a decision rendered on May 2. There is no abuse on the part of the employer if the loan contract provides for such early repayment, even if it is not obliged to demand these sums.
This is how the Axa executive, dismissed, opposed his boss who demanded from him, because of his departure, the reimbursement of the balance of a real estate loan which had been granted to him seven years earlier for the acquisition of housing. The company also demanded compensation for default by the borrower, as provided for in the consumer code which regulates business loans.
The goodwill of the boss
The loan contract provided that there would be early repayment in the event of the employee’s departure, whether he was dismissed or resigned, but this was an inapplicable clause, the employee argued. It is inapplicable, he said, because it is linked to the goodwill of the lender, who is not obliged, according to the contract, to demand this early repayment. It is written, he observed, that the loan will become immediately payable in the event of departure from the company, “if it seems good to the lender, without there being any need to complete any legal formalities.»
The justices did not specifically respond to this argument. They only noted that the early repayment that could be required in the event of dismissal or resignation was also linked to “an initiative of the employer in the event of dismissal as well as that of the employee in the event of resignation.» And since the dismissal was justified, they admitted that the company could take advantage of this early repayment clause.