The importance of distinguishing between disputes over the cost of expert appraisals and those over the need for them

Cass. soc., October 18, 2023, no. 22-10.761

In a ruling handed down on October 18, 2023, the French Supreme Court (Cour de cassation) revisits the need to distinguish between the final cost of an expert appraisal and the question of its necessity, insofar as the time limits for contesting it are not the same. In this regard, she emphasized that the employer, who “does not criticize either the amount of the invoices sent to him or the final cost of the expert reports, but contests the principle of his payment“, is therefore precluded from contesting the expert appraisal on receipt of the final invoice, and not at the time of the CSE’s decision to call in the expert.

In practice, this nuance is sometimes difficult to grasp, so vigilance is called for when the CSE decides to call in an expert. Above all, we need to act quickly.

Here are a few clarifications.

1. The facts of the case

In this case, the CSE decided, on February 28, 2019, to call in a chartered accountant to assist with the mandatory annual consultation on the company’s economic and financial situation,on the basis of article L. 2315-88 of the French Labor Code, and then subsequently, on March 21, 2019, to call in a chartered accountant to assist with the annual consultation on social policy, working conditions and employment,on the basis of article L. 2315-91 of the French Labor Code.

A consulting firm is then appointed for both situations. The expert’s report will be discussed at a meeting of the CSE on July 11, 2019. The final invoice for the balance of fees will be sent to the employer on July 25, 2019, after the employer has already paid a deposit.

Subsequently, the employer intends to request reimbursement of the deposit, while refusing to pay the balance. It considers that these two expert reports did not fall within the scope of the mandatory consultations, but were free expert reports, for which it was not responsibleThey were premature as soon as they had been decided:

• for the first, before transmission of the accounts ;
• for the second, prior to the filing in the BDES (now BDESE) of information documents relating to social policy, working conditions and employment.

On August 2, 2019, he filed a claim with the Court of First Instance – within 10 days of receiving the expert’s final invoice – but the Court declared his claims inadmissible on the grounds of foreclosure, as his challenge was considered late.

Initially, the Cour de cassation disagreed with the Court’s solution, holding that the employer was contesting the final cost of the expert appraisal, and taking up the latter’s argument that the deliberations, which had taken place prematurely, had not “generated for the employer the obligation to assume the cost of the expert appraisals”.so that he “could only react at the moment when it was asked to assume this cost, i.e. at the time of the final invoice” (Cass. soc., June 9, 2021, no. 20-10.886).

The Court of First Instance, ruling on a referral from the Supreme Court of Appeal, resisted the High Court’s position, holding that it was not the payment of the expert opinion itself that was in dispute, but rather its principle (TJ Pau, January 5, 2022, no. 21/01409).

The employer then lodged a new appeal, pointing out that:

• on the one hand, that the challenge to these expert reports was based on their premature nature, and that they should be considered as unrestricted (and therefore at the financial expense of the CSE), since they were decided well before the mandatory consultations were held;
• secondly, that he was not contesting the need for the expert appraisals, but rather their final cost, so that he could only take action once he had received the final invoice.

Surprisingly, the Cour de cassation has reversed its position less than two years after its first decision, proving that the issue is not an easy one.

It considers that :

” The judgment states that the employer is not criticizing either the amount of the invoices sent to it or the final cost of the expert reports, but is contesting the principle of payment. on the grounds that, having been decided before the financial statements were submitted and the relevant information documents filed, they were free expert appraisals.

It notes that the employer was informed of the deliberations adopted at the CSE meetings of February 28 and March 21, 2019, which he attended, and of their consequences.the fact that it should bear the cost of expert appraisals ordered for recurring consultations and that it has paid, without dispute, the deposit demanded by the expert appointed by these same deliberationsand deduces that the late referral of August 2, 2019 for the purpose of contesting the nature of the disputed expert appraisals is inadmissible on grounds of foreclosure.

These findings which means that the employer was informed of the nature and purpose of the expert appraisals as soon as they were discussed by the CSE, the president of the court, without changing the subject of the dispute, deduced exactly that the late referral of August 2, 2019 for the purpose of contesting the nature of the disputed expert appraisals was inadmissible on grounds of foreclosure.”

This decision should therefore draw companies’ attention to the grounds for recourse to expert appraisal raised by the CSE, as well as to the various time limits that apply in the event of a dispute.

2. A reminder of the rules applicable to contesting expert appraisals

It should be remembered that there are various ways of contesting expert appraisals[1]:

• the need for expertise ;
• choice of expert ;
• the estimated cost, scope or duration of the expertise ;
• the final cost of the expertise.

As a result, the starting point of the 10-day time limit for bringing an action before a court[2] differs depending on the object of the dispute, i.e. from :

• the deliberation of the CSE to contest the need for the expert appraisal;
• the appointment of the expert by the CSE to contest the choice of the expert;
• notification to the employer of the specifications and information stipulated in article L. 2315-81-1, i.e. notification to the employer by the expert of the estimated cost, scope and duration of the expertise, in order to contest the cost beforehand
• notifying the employer of the final cost, in order to contest it

Identifying the nature of the challenge to the expertise is therefore essential.

[1] C. trav., art. L. 2315-86

[2] C. trav., art. R. 2315-49

3. Need for expertise versus final cost: how to position yourself

The dispute therefore crystallized around the time limit for bringing the case before the judge, since it is true that the French Labor Code made no provision for such a challenge. However, the judges considered that it was “most closely related” to the challenge of necessity.

Indeed, although the employer contested the assumption of the cost of these expert reports, considering that they were free expert reports to be paid for by the CSE and not by it, the fact remains that it contested in fine the principle of its payment and not the payment itself, in other words, the subject of these expert assessments.

The Cour de cassation ruled against the employer on this point.

It also considered that the latter had been informed of the deliberations adopted at the CSE meetings of February 28 and March 21, 2019, and in particular of the fact that it would have to bear the cost of expert appraisals ordered with a view to recurring consultations.

It therefore takes this opportunity to reiterate the rule that the ten-day period for contesting the need for an expert opinion “only runs from the day when the employer was made aware of its nature and purpose“. This rule has already been referred to by the Court in another recent case, where the CSE, which had voted at a first meeting for an expert report on health, safety and working conditions, and then, at a subsequent meeting, for the use of an authorized expert in the context of this report on serious risk, had only placed the employer in a position to know the nature and purpose of this expert report at the time of the second meeting, which in this case was the one at which the expert had been appointed. (Cass. soc., Apr. 5, 2023, no. 21-23.347).

On the contrary, in the present case, the employer was in a position to know the nature and purpose of the disputed expert appraisals from the very first meetings, so that their challenge, which only came when the final invoice was received, came late in the day.

This is all the more true given that he disputed “neither the amount of the invoices sent to him nor the final cost of the expert appraisals”, and that he had paid, without disputing it, a deposit demanded by the expert, proof that he was in fact disputing the need for the appraisal.

In this respect, it should be noted that the CSE’s right to call in an expert for recurring consultations is not, in principle, conditional on any state of necessity that the CSE would have to demonstrate. The choice to call on the services of an expert is a freedom that elected representatives may or may not decide to exercise.

However, the employer may contest the need for the expert opinion if the legal conditions for appointing the expert are not met. This was the case in a case where the premature appointment of a chartered accountant, which took place 15 days before the presentation of the accounts to the works council, was considered by the High Magistrates as falling within the scope of article L. 2325-41 of the Labor Code relating to free expert appraisal, which, it should be remembered, is paid for by the works council. (Cass. soc., March 28, 2018, n°16-12.707).

The employer’s position was certainly based on this decision, but this did not absolve him of the obligation to refer the matter to the CSE within 10 days of its first meeting, insofar as he was informed at that time that the conditions for appointment had not been met.

As you can see, when your works council decides to call in an expert, it is strongly recommended that you forward the CSE’s decision to your board without delay.and the expert’s engagement letter, so that we can analyze together the appropriateness of such a challenge, and above all determine how to proceed.Given the very strict deadlines that apply in this area.