While lawyers may exercise their activity by forming a commercial company, such law firm admitted to the Luxembourg Bar is civil by nature despite the adoption of the form of a commercial company. Therefore, the accepted invoice principle (“principe de la facture acceptée”) laid down in article 109 of the commercial code is not applicable to invoices (“mémoire d’honoraires”) issued by law firms.
In the case at hand, the claimant (a law firm established under the form of a limited liability company) and the defendant entered into an “Engagement Letter for Legal Assistance” relating to the provision of legal services. According to the claimant, the fees associated to those legal services were left outstanding by the defendant. The claimant brought a legal action against the defendant before the district court of Luxembourg (“Tribunal d’Arrondissement de et à Luxembourg”) to obtain payment of the invoices.
Before the district court, the claimant invoked the provisions of article 109 of the Luxembourg commercial code introducing the commercial law principle of the accepted invoice (“facture acceptée”) according to which, between traders, any invoice is presumed to be accepted unless it has been challenged within a short period of time. According to the claimant, the invoices were not validly disputed by the defendant.
By judgment rendered on 27 February 2019, the Luxembourg district court declared the claim unfounded as the documents supporting the claim were not deemed sufficiently precise to constitute invoices within the meaning of article 109 of the commercial code.
The claimant appealed this judgment by arguing that the invoices did have the degree of precision necessary for the accepted invoice principle to be applicable. In support of its claim, the claimant further referred to a judgment rendered on 12 July 2017 recognising the application of the provisions of article 109 of the commercial code to bills of costs (“mémoire d’honoraires”) issued by law firms.
On 29 June 2021, the court of appeal ruled that the accepted invoice principle is not applicable to the case at hand. According to the court, there is no doubt that the accepted invoice principle does not apply to bills issued by liberal professions, such as law firms. Indeed, while lawyers may partner up by forming a commercial company, such law firm admitted to the Bar remains civil by nature despite the adoption of the form of a commercial company, as clearly provided in article 34-2 (3) of the law of 10 August 1991 relating to the lawyer’s profession, as amended.
The court further indicated that the judgment of 12 July 2017 invoked by the claimant is a stand-alone decision and does not constitute actual case-law, in addition to contradicting the law.