Commercial Leases/Business Goodwill

In accordance with Article L. 145-38 of the Commercial Code, the initial rent remains the same during the first three years, after which each party has the option to request a revision, even in the absence of a contractual provision to that effect. The triennial revision applies to all leases subject to the status of commercial leases, including step leases , with the exception, however, of leases …

Principle

In accordance with Article L. 145-38 of the Commercial Code, the initial rent remains the same during the first three years, after which each party has the option to request a revision, even in the absence of a contractual provision to that effect. The triennial revision applies to all leases subject to the status of commercial leases, including step leases , with the exception, however, of leases with a turnover clause .

The provisions of Articles L. 145-37 and L. 145-38 are of public order. Indeed, Article L. 145-15 deems unwritten, since Law No 2014-626 of 18 June 2014 , regardless of their form, clauses, stipulations, and arrangements that have the effect of defeating these provisions. This applies to the stipulation that provides for a biennial rent review , or a rent variation exclusively upwards following the construction cost index , or that in the event of the abolition of all or part of the taxes and charges borne by the lessee, an amount equal to the refunded portion will be added to the rent by right and immediately . No clause of the lease can obstruct the legal revision , and the parties, even if they have validly decided to set the lease price in advance and as a lump sum, retain the ability to request its triennial revision . However, the clause that sets a rent variation lower than that of the construction cost index is not contrary to Article L. 145-38 of the Commercial Code, which only prohibits modifications exceeding the index variation .

If, due to the public policy nature of Articles L. 145-37 and L. 145-38, the parties cannot waive in advance any price revision , they may do so as soon as the right to the triennial revision has arisen and been acquired . Indeed, Article L. 145-15 does not prohibit, once the conditions for legal revision are met, the parties from deciding by mutual agreement to proceed without regard to the rules of Article L. 145-38 . Waiving the legal revision mechanism requires an amicable agreement between the parties, which may, in particular, result from a transaction freely concluded between them, in the presence of the court, establishing the tenant's consent to the lease price setting and their express waiver to invoke the rules of Article L. 145-38 . Conversely, the two price revisions at eight-month intervals imposed by the landlord on the tenant, who had exceptionally waived the rules applicable to legal revision, are illegal .

Finally, the triennial review must not occur unilaterally. Thus, a landlord cannot proceed with a garnishment on the tenant's bank account to obtain payment of rent arrears, calculated based on a triennial review that they have unilaterally proposed to the tenant .

Paris, 2 February 2011, LawLex202300007227JBJ, according to which a stepped lease constitutes a contract where the evolution of the rent amount, generally progressive, is predetermined for the amount and the date on which the change must occur, this evolution being independent of the rules of triennial revision.

Cass. 3e civ., 2 October 1984, LawLex202100004802JBJ, Bull. civ. III, No 156. – Also see Cass. 3e civ., 10 December 2002, LawLex202100004813JBJ, D. 2003, AJ 348, note ROUQUET; Loyers et copropr. 2003, comm. 135.

Cass. 3e civ., 6 November 1991, LawLex202300007223JBJ: in this case, the new rent was agreed upon between the landlord and the tenant, without any reservation from the latter for more than three years until the objection to the order. – See however Cass. 3e civ., 7 March 2001, LawLex202300007224JBJ, where the Court of Cassation decides that the parties can waive the rules of Article L. 145-38 during the lease term even though the three-year period had not yet expired at the time of the amendment in question.

Cass. 3e civ., 24 October 1979, LawLex202300005999JBJ; 26 May 2016, LawLex202300007226JBJ.

Cass. 3e civ., 24 October 1979, LawLex202300005999JBJ, op. cit.

Cass. 3e civ., 29 March 1995, LawLex202300007350JBJ.

Cass. 3e civ., 12 April 1995, LawLex202100004019JBJ, which specifies that in the absence of an agreement between the parties, it is incumbent upon them to refer the matter to the commercial rent judge to set the revised rent price.

L. 2014-626 of 18 June 2014 on craftsmanship, commerce, and very small enterprises, OJ of 19 June 2014, Art. 6. – It is specified that under the regime prior to Law 2014-626, these types of clauses, stipulations, and arrangements were declared null and void. – See also Cass. 3e civ., 19 November 2020, LawLex202200009544JBJ, D. 2020, 2342; D. actu. 4 January 2021, obs. CAYOL; D. 2021, 310, obs. BOFFA and MEKKI; D. 2021, 983, obs. COLLOMP, GEORGET, JARIEL; D. 2021, 1397, obs. DUMONT; AJDI 2021, 513, obs. BLATTER; RTD civ. 2021, 124, obs. BARBIER; RDC 2021/1, 22, note LATINA; RDC 2021/1, 72, note SEUBE; JCP 2021, doctr. 240, obs. HOUTCIEFF; JCP E 2020, act. 809; JCP E 2021, 1168, No 8, obs. MONEGER; RJDA 2021, No 82; LEDC January 2021, 2, obs. LEBLOND; Rev. prat. rec. 2021, 25, chron. MORGANTINI and RUBELLIN; Loyers et copropr. 2021, comm. 10, obs. MARCET; BPAT 1/21, inf. 23, which specifies that if Law 2014-626 of 18 June 2014, in that it amended Article L. 145-15 of the Commercial Code, replaced the nullity of clauses intended to defeat the provisions of Articles L. 145-37 to L. 145-41 of the Commercial Code with their deemed unwritten status, it is rightly that the trial court held that this text is applicable to ongoing leases and concluded that the action seeking to deem unwritten the lease clause relating to rent revision, filed on 13 January 2016, after the entry into force of the aforementioned law, which is not subject to prescription, is admissible.

Cass. com., 20 November 1961, LawLex202300007346JBJ.

CA Paris, 28 March 2003, No 2002/08349, previously cited.

CA Paris, 2 October 2008, LawLex202300008411JBJ.

Cass. 3e civ., 30 January 2002, LawLex202100004775JBJ, Bull. civ. 2002, III, No 21; AJDI 2002, 288, note DUMONT; JCP E 2002, No 11, 446; Administrer Apr. 2002, 26

Cass. 3e civ., 18 December 1985, LawLex202300007225JBJ.

CA Paris, 28 March 2003, No 2002/08349, prec.

Commercial Leases/Business Goodwill

158. Principle

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158. Principle

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