Scope of an enforceable authentic debt recognition in a debt enforcement proceeding for immovable pledges opposable to a third-party owner of the pledge

Facts

Parties and context: The third-party owner of the pledge (defendant and appellant) is the owner of a floor in a condominium property (PPE) located in Geneva, leased to company C. In 2009, the tenant engaged company D. SA (general contractor/debtor) to carry out work in the premises. The general contractor subcontracted various works to B. (craftsman/subcontractor/creditor/respondent). The craftsman issued several invoices to the general contractor for a total amount of 334’578 fr., partially unpaid.

Cantonal proceedings: The craftsman requested the registration of a provisional legal lien of craftsmen and contractors on the condominium share of the third-party owner, registered in the land register on 29 January 2010. By judgment of the Geneva Court of First Instance of 20 June 2016 (confirmed by the Geneva Court of Justice on 28 April 2017), the legal lien was definitively registered for an amount of 334’578 fr. with interest at 5% per annum from 28 December 2009.

Debt recognition: On 7 May 2018, the general contractor acknowledged owing the craftsman the amount of 334’578 fr. with interest at 5% per annum from 28 December 2009, by notarial deed constituting an authentic debt recognition (art. 80 and 81 FSREO). An agreement of 27 February 2021 set the interest at 115’422 fr., payable by 31 March 2022, failing which the full interest due would be payable. The craftsman received 334’578 fr. (principal) and 30’000 fr. (partial interest) on 4 March 2021. No further payments were made by the general contractor.

Debt enforcement proceeding for immovable pledge: In July 2022, the craftsman requested a debt enforcement proceeding for immovable pledge against the general contractor and the third-party owner of the pledge for an amount of 157’038 fr. 40 (balance of unpaid interest). The general contractor filed an opposition to the payment order, while the third-party owner also filed an opposition. The craftsman filed two separate requests for definitive removal of the opposition: one against the general contractor (removal ordered on 14 November 2022, uncontested) and one against the third-party owner.

Cantonal decisions: The Geneva Court of First Instance dismissed the request for definitive removal of the opposition against the third-party owner by judgment of 20 June 2023. The Civil Division of the Geneva Court of Justice quashed and reformed this judgment by ruling of 6 November 2023, definitively lifting the third-party owner’s opposition. The cantonal court held that the recognition of the debt by the general contractor was sufficient as a provisional removal title, even though it did not bind the third-party owner.

Appeal to the Federal Supreme Court: The third-party owner appealed to the Federal Supreme Court against the cantonal ruling of 6 November 2023, notified on 10 November 2023. The Federal Supreme Court admitted the appeal.

Considerations

Jurisdiction and procedural framework: The Federal Supreme Court recalls that, although it applies the law ex officio (art. 106 para. 1 FSCA), it only examines the grievances raised by the parties, except in cases of manifest violation of the law. It also recalls the principle of exhaustion of grievances (art. 42 para. 2 FSCA), according to which issues not submitted to the cantonal instances cannot be examined. In the present case, the central issue concerns the scope of an enforceable authentic debt recognition (art. 347 and 349 CPC) as a title for definitive removal of opposition in a debt enforcement proceeding for immovable pledges directed against a third-party owner of the pledge.

Immovable pledge right and enforcement proceeding: The immovable pledge creditor, holding a definitive legal lien (art. 837 para. 1 no. 3 CC), may request the enforcement proceeding for the immovable pledge (art. 151 et seq. FSREO) once the debt is due and has not been paid by the debtor. This rule applies both when the owner of the pledge is the personal debtor and when it is a third party. The third-party owner, although co-sued, does not acquire the status of personal debtor but may contest the debt or the pledge right. To lift the oppositions, the creditor must have a title for definitive or provisional removal of opposition (art. 80-82 FSREO).

Authentic enforceable title and identity of the parties: An authentic enforceable title (art. 347-352 CPC) allows the creditor to obtain definitive removal of the opposition, provided that the debtor pursued is…