Arst Avocats has created this mini-series to give you an inside look at a court-ordered reorganization procedure. Full episodes are available on the Arst Avocats website.
By Morgan Jamet, Partner Attorney — Insolvency Law
Published on August 22, 2026
8:40 a.m. The courthouse corridor smells of stale coffee and paper. On the notice board, the day's docket stretches across an entire column—some thirty cases before his. Marc sits on the edge of an uncomfortably hard chair, clutching its backrest as if it might spring out. He rereads his notes for the tenth time. His hands can't quite stay still.
"Where are we with the role?" He asks me this every twenty minutes, more or less.
We wait. This is the part that's never mentioned: the hearing itself lasts ten minutes, but the wait can last two hours. Around us, other executives are waiting for the same thing, with the same expression.
We take advantage of this lull to rehearse, one last time, what he'll say if the president asks him directly—which happens often. Not a speech. A factual, precise explanation, without flinching at the figures. "You say the company is viable, Marc. Prove it in one sentence." He hesitates, starts again. Order book full for the next four months. Two serious clients who are due to pay within two weeks. Cash flow tight but holding up, provided nothing new is added to the liabilities. Employees informed, and behind him rather than against him. It doesn't sound like much, put like that. In reality, it's all that matters.
"Dupont Establishments, file number 14." We stand up.
The hearing is not being held in the main courtroom, the one where the public sits on wooden benches. It is taking place in the council chamber—a smaller room with a closed door. This is no accident: the law requires that these proceedings remain private, because they concern figures and situations that are the sole responsibility of the parties involved.
Facing us was the president, flanked by two commercial court judges—business owners themselves, before becoming judges. To the side was the clerk, who already had everything in front of him: the declaration of insolvency, filed a few days earlier, which the court had read before we even entered. Slightly apart was the representative of the public prosecutor's office, present because this type of procedure requires it. No one in this room was seeing Marc's case for the first time. They already knew it. What they wanted now was to hear from him.
The president wastes no time with formalities. He asks the question — the only one that truly matters, the one around which everything else is organized:
"Are you certain you won't create any new liabilities during the observation period? Will your income cover your expenses?"
That's the heart of the matter. Not whether Marc has managed his company well or poorly so far—that's not the issue today. The only thing the court must decide is whether the company can survive from now on without further increasing its debt. Marc responds with the words we've been repeating in the hallway—not recited, just stated, because they're true. The order book. The clients who have to pay. The employees who are staying.
The president asks further, more technical questions—about the exact date on which the company could no longer meet its liabilities with its available assets. This is the date of cessation of payments, the one I had discussed with him weeks earlier, one evening, during a video call. The court must determine it precisely, and Marc now understands why it's not a mere administrative detail.
Nothing stops there. No adjournment, no withdrawal for deliberation: everything unfolds in the immediate continuation of the exchange. The presiding judge turns to the representative of the public prosecutor's office. "Mr. Prosecutor?"
This is the moment when no one in the room is breathing quite normally. Everyone awaits his words as if awaiting a verdict—a few words that could change everything. Favorable? Reserved? The prosecutor speaks briefly: he doesn't oppose the opening. He simply emphasizes that the date of cessation of payments must be precise.
The president then looks at his two assessors, one after the other. A barely perceptible nod from each. That's enough.
"The court is initiating insolvency proceedings against the company Établissements Dupont, represented by its director, Mr. Dupont."
I'm not sure Marc is really hearing what's coming next. The court immediately appoints a supervising judge, who will oversee the case from beginning to end; a court-appointed representative, who will represent the creditors; and a court-appointed administrator, who will support—and monitor—the management during the observation period. Three names, three roles that will weigh heavily on him for the next few months. Marc nods politely each time, but I can see he's not registering anything. He's just heard the only word that matters: opening. I'll explain the rest to him later, when things are calm.
What I can't let slide is what comes next. There's no court-appointed administrator in the room yet to discuss it—he's only just been appointed; he didn't exist a minute ago. So the president himself turns to Marc directly: "Since when, exactly, have you been unable to meet your current liabilities with your available assets?"
This is the kind of question where you have to be honest without being generous. Never let the court think that this date could be set arbitrarily, as the conversation unfolds—maintain the strictest and most rigorous position possible, the one that doesn't expose Marc to unnecessary risks later. I answer on his behalf, using the date we calculated together in the file, not a day more than the figures dictate. The court accepts it as is.
This is a point that should not have been overlooked, even — especially — at the moment when one is relieved.
In the hallway, once the door had closed, Marc finally breathed a sigh of relief. "Is it good? Is it really good?"
Yes. That's good. For now.
—
(Marc is a fictional, composite character.)
SEEN FROM THE INSIDE, a series about bankruptcy proceedings told in a concrete way.
Next episode: at the court-appointed administrator's office.
Morgan Jamet,
founding partner of Arst Avocats, advises business leaders on commercial law, insolvency law, restructuring, and business litigation.
View his profile
