Arst Avocats designed this mini-series to give you an inside look at a judicial reorganization procedure.
By Morgan Jamet, Partner Attorney — Insolvency Law
Published on August 22, 2026
The administrator's report, received the previous evening, remained open on Marc's kitchen table until late into the night. In the courthouse corridor, before the hearing began, it was still being discussed—with the administrator himself, who was waiting there, file under his arm, and with the court-appointed representative, who had arrived at the same time as us.
“Your report is quite cautious,” I told him bluntly. “Almost too cautious.” The administrator didn’t bristle. “I can’t write that everything is fine if I can’t guarantee it in court, Counsel. I’m simply stating the facts. I’m not arguing.” Therein lies the crux of the matter: he wants the continuation to have a chance, I know that, but he also doesn’t want to find himself contradicted in ten minutes by his own words. So he sticks to the facts. Neither for nor against.
The trustee, however, has no such hesitation. “The declared liabilities have increased since the proceedings began. I represent the creditors; I can’t turn a blind eye to that.” This isn’t a pose. It’s precisely his role. I remind him of what I’ve already explained to the administrator: these debts are disputed, the law allows them to be included in the projections without prejudging their fate, and if we win these challenges, they will be deducted from what the plan must repay. He listens, doesn’t budge, but doesn’t close the door either.
There was more to the corridor than that, though. The two regular customers, the ones from the very first night, continued to place orders—one of them even discreetly asked if Marc needed him to pay sooner than expected. Since opening, the business has been operating without a hitch.
In the boardroom, the chairman first questions the administrator about the company's overall situation since the last hearing—no economic and social report to be presented this time, that's not the purpose of this stage, just a status update, but a comprehensive one. He answers calmly, without emphasis: the cash flow, the jobs largely preserved, the two layoffs carried out properly a few weeks earlier, the customer relationships holding up, almost everything is positive—except for that infamous liability, heavier than expected, which he mentions without downplaying it.
The chairman picked up on that, but not only that. "Are your clients still with you, Mr. Dupont?" Marc answered himself this time, without me needing to speak for him: "Yes. One of them even offered to pay us in advance. These are people who have known us for years." The chairman took note, moved on to the treasury—"Any outstanding debts incurred since the opening?"—the administrator confirmed, providing supporting figures.
Then comes the liabilities, and the tone shifts a notch. "The declared liabilities have increased significantly since the opening judgment. On what basis can the company claim a plan?" It's my turn. I elaborate: three disputed claims—the lease at its replacement value, the lessor's compensation against the security deposit, and the supplier's invoice for non-conforming goods. The law allows for the inclusion of a disputed but identifiable claim in the projections, without prejudging its fate; if we win, it is simply deducted from what the plan must reimburse. The court can build on today's figures without tying its hands for tomorrow.
The representative spoke again, still unconvinced: "Three challenges at once is a lot. There's no guarantee they'll succeed." The chairman turned to the administrator: "Do you confirm the seriousness of these challenges?" He confirmed it—without declaring them a foregone conclusion, but without dismissing them either. Exactly the line he had maintained in the corridor.
In the room, there's a representative of the employees, appointed at the start of the meeting. The chairman asks him directly what he thinks about the future. He doesn't say much, but what he does say matters: "The employees are confident. We think we'll get through this. Those who remain are committed." It's not a statistic, nor a legal argument. It's something else, and I can see that it carries weight too.
The prosecutor, who had been silent until then, posed his own questions—how much longer before these challenges would be resolved, what would happen if they were lost, whether the plan would still hold. I answered them, one after the other. Then he closed his file, and it was he who broke the silence in the room, almost with a benevolent weariness: “At this stage, we must trust the debtor. The company has shown, in six months, that it keeps its subsequent commitments. There will always be time to consider other options if things go wrong. Today, there is no justification for doing so.”
Marc, next to me, says nothing, but I know that he has counted, like me, the three paths that this sentence closes or leaves open: the continuation of the observation, which is taking shape; the conversion into liquidation, which we have just ruled out for this time; the search for buyers in parallel, which we will not have to launch, not yet.
The president looks at his assessors, then directly at Marc. "The court orders the continuation of the observation period for a duration of six months—time, this time, to develop a serious plan."
In the hallway, Marc finally breathes a sigh of relief. "That was a close call." "Yes, it was. But we had strong arguments, loyal clients, employees who believed in us, and someone to listen to all of that." That was just the intermediate step. What comes next is something else entirely: we'll have to transform everything we've just argued into a plan that the court can, one day, approve.
Marc understands, this time, that it wasn't just another administrative appointment. It was a battle, narrowly won — and that what follows won't be any easier.
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*Marc and the situations described in this series are fictional, composites of cases encountered in practice. Any resemblance to a real situation is purely coincidental.*
Next episode — Season 1, Episode 11/17: " The Request for the Appointment of a Controller "
Morgan Jamet,
founding partner of Arst Avocats, advises business leaders on commercial law, insolvency law, restructuring, and business litigation.
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