Commercial Leases/Business Goodwill

Article L. 145-40-2 of the Commercial Code, which is of public order , specifies that any lease agreement must include a precise and exhaustive inventory of the categories of charges related to this lease, indicating their allocation between the landlord and the tenant. If the text does not provide any definition of the different categories of charges, the parties may refer to the list of recovera …

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Article L. 145-40-2 of the Commercial Code, which is of public order , specifies that any lease agreement must include a precise and exhaustive inventory of the categories of charges related to this lease, indicating their allocation between the landlord and the tenant. If the text does not provide any definition of the different categories of charges, the parties may refer to the list of recoverable charges concerning residential leases, which is annexed to Decree No 87-713 of 26 August 1987 , which applies to a commercial lease only if the parties have agreed to submit the determination of rental charges to it . Otherwise, it is up to them to conventionally provide, at the conclusion of the commercial lease, a clear and precise allocation of charges between the landlord and the tenant , failing which they cannot constitute recoverable charges, it being specified that façade restoration expenses do not constitute rental charges .

However, Article R. 145-35, 4° of the Commercial Code, stemming from Decree No 2014-1317 of 3 November 2014, lists certain rental charges that cannot be charged to the tenant. It thus prohibits charging the tenant for “the landlord's fees related to the management of the rents of the premises or building subject to the lease,” which are distinct from the technical management fees of the building, which must be justified by the cost of managing the building . The tenant may notably agree to cover both the syndic fees and the management fees . Article R. 145-35, 1° also addresses fees related to major repairs, mentioned in Article 606 of the Civil Code, which cannot be charged to the tenant.

In a real estate complex, paragraph 3 of Article L. 145-40-2 emphasizes that the lease must determine the allocation of charges among the different tenants occupying the building, which is based on the area used, and whose amount strictly corresponds to the premises occupied by each tenant and the share of common areas necessary for the operation of the leased premises, it being specified that this allocation among tenants may conventionally be subject to weighting, which is brought to their attention (Article R. 145-35, para. 2). If the lease can detail the charges owed in clear terms, which are binding between the parties , it can also specifically refer to the building's internal regulations setting the basis for the allocation of charges, even if it was established after the conclusion of the lease, as long as it makes the tenant's share of charges determinable, without abuse, at the time of contract execution . Conversely, when a lease does not specify the share of common areas allocated to the premises, the landlord must be ordered to reimburse the provisions paid by the tenant for unjustified co-ownership charges . Article R. 145-35, 5° of the Commercial Code specifies that charges related to vacant premises located in a real estate complex, or attributable to other tenants of the building, cannot be charged to the tenant.

Before the publication of Decree No 2014-1317 of 3 November 2014 , commercial leases could provide for the lump-sum payment of charges, either by conventionally setting a rent including charges or through a clause stipulating a lump-sum reimbursement of these charges, which had to be clear and precise, excluding certain charges such as taxes and levies. Since 5 November 2014, the date of entry into force of the decree, leases concluded or renewed after this date can no longer provide for a “net of charges” rent, nor even the lump-sum payment of charges.

Finally, Article L. 145-40-2, para. 1, of the Commercial Code provides that the inventory must be the subject of an annual summary statement sent by the lessor to the lessee. This statement, which includes the settlement and adjustment of charge accounts, must, according to Article R. 145-36 of the same code, “be communicated to the tenant no later than 30 September of the year following that for which it is established or, for buildings in co-ownership, within three months from the rendering of co-ownership charges for the annual period.” If the late adjustment of charges constitutes a fault by the lessor exposing them to the payment of damages, the absence of adjustment renders the calls for advance payments on charges unfounded, for which the lessee may obtain reimbursement .

According to Article L. 145-15 of the Commercial Code, clauses, stipulations, and arrangements that have the effect of defeating Article L. 145-40-2 are deemed unwritten, regardless of their form.

Decree No 87-713 of 26 August 1987 issued pursuant to Article 18 of Law No 86-1290 of 23 December 1986 aimed at promoting rental investment, access to ownership of social housing, and the development of land supply, and establishing the list of recoverable charges.

Decree No 2014-1317 of 3 November 2014 concerning commercial leases.

Cass. 3e civ., 5 November 2014, LawLex202200006036JBJ. – Also see Paris, 20 November 2019, LawLex202100004607JBJ, which adds that the absence of prior contestation of paid charges does not prevent the lessee from making a claim for restitution of undue payments, within the limits of the statute of limitations; Paris, 27 June 2024, LawLex202400005042JBJ.

Cass. 3e civ., 3 October 2012, LawLex202100004531JBJ.

Cass. 3e civ., 26 March 2013, LawLex202200010890JBJ.

Cass. 3e civ., 21 February 1996, LawLex202200008302JBJ.

CA Douai, 12 July 2018, LawLex201800001098JBJ.

CA Paris, 14 June 2018, LawLex202100004559JBJ, for a clause stipulating that “the lessee shall bear the management and syndicate fees so that the rent fixed above is received by the lessor net of all charges.”

Cass. 3e civ., 26 March 2013, LawLex202200010890JBJ, op. cit.

Cass. 3e civ., 24 November 2004, LawLex202100004526JBJ.

Cass. 3e civ., 15 February 2018, LawLex202100001370JBJ: in this case, the landlord did not provide any supporting documents based on statements issued by the condominium trustee.

Commercial Leases/Business Goodwill

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