Refusal to Reopen an Auction and Cancellation of a Pledge in Case of Unsuccessful Enforcement

Facts

The company M. S.A. requested the realization of a pledge on a property belonging to G. for an amount of 3'950'014,90 Swiss francs. The FPO of Mendrisio organized an auction, but no one showed up. The FPO declared the auction deserted and closed it after 20 minutes. The representative of the company M. S.A. arrived a few minutes later and asked to make an offer, but the FPO refused. The company M. S.A. then filed an appeal with the Federal Court.

The key facts are as follows

• The company M. S.A. requested the realization of a pledge on a property belonging to G.
• The FPO of Mendrisio organized an auction, but no one showed up.
• The FPO declared the auction deserted and closed it after 20 minutes.
• The representative of the company M. S.A. arrived a few minutes later and asked to make an offer, but the FPO refused.

Considerations

The Federal Court examined the FPO's decision to close the auction after 20 minutes and refuse to reopen it. The Court considered that the FPO's decision was in accordance with its discretion and that there was no abuse or excess of power.

The Court also examined the issue of cancellation of the pledge in case of unsuccessful enforcement. It considered that Article 111 FSREO, which provides for the cancellation…