Dividends paid to spouses under community of property: to whom must they be paid?

July 17th 2015

The French Civil Supreme Court (Cour de cassation) issued a clear decision on March 5, 2014: it is only the spouse shareholder who may receive the dividends.

It censors the decision of a Court of Appeal which had considered that the dividends were by their nature communal, and therefore each spouse had a right to such dividends.

This decision reinforces the distinction between shares and finance: the social rights do not fall into the marital community in kind but only as an asset and as it is the owner of the share who is shareholder, he is the only one able to exercise the related rights and in particular to receive the dividends.

Accordingly, the companies must be careful to pay the dividends to the named shareholders and not to their spouses, even though the latter are under community of property; failing that, they may have to pay twice!

Laurent Viénot