News

The Court of Cassation (com., July 9, 2025, No. 24 10.428) reaffirms a strong principle for SAS companies: the articles of association take precedence.

Even if the partners vote unanimously to derogate from the articles of association, an internal decision cannot replace them if it contradicts them. In this case, the articles of association of an SAS provided for the possibility of ad nutum dismissal of the CEO, but the shareholders subsequently agreed, in a unanimous decision, on stricter conditions for dismissal.

The CEO, who was dismissed without cause, sued the company for failure to comply with the conditions for dismissal.

Although the Court of Appeal initially upheld his claim, giving precedence to the unanimous decision of the shareholders, the Court of Cassation ultimately overturned this decision in favor of the company (as an aside, it nevertheless upheld the vexatious nature of the dismissal and maintained the company’s conviction on this point).

This ruling perfectly illustrates the hierarchy of norms in company law: in SAS companies, the articles of association constitute the main norm for shareholders, particularly in terms of governance.

This primacy of the articles of association is inherent in the statutory freedom offered in SAS companies: the organization of this type of company is certainly very free, but it is still necessary to be able to refer with confidence to the content of the articles of association.

This decision therefore contributes to greater legal certainty. Thus, even if all the shareholders agree to require just cause for dismissal, this intention remains legally ineffective until it is formalized by an amendment to the articles of association.

However, one point remains to be noted: the Court states that “a decision by the partners may supplement the articles of association [on the terms of dismissal], but may not derogate from them, even if it was taken unanimously.” In some cases, it will remain difficult to identify which decisions supplement the articles of association (valid) and which derogate from them (ineffective).

Christophe BLUM, Partner and Guillaume BUFFLER, Of Counsel.