Commercial Leases/Business Goodwill

According to the Court of Cassation, even if no particular form is required for drafting the notice, it must necessarily present itself as an act intended to unequivocally inform the contracting party of the intention to terminate the lease, for the date and under the conditions specified . Paragraph 5 of Article L. 145-9 of the Commercial Code emphasizes that the notice must, under penalty of nul …

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According to the Court of Cassation, even if no particular form is required for drafting the notice, it must necessarily present itself as an act intended to unequivocally inform the contracting party of the intention to terminate the lease, for the date and under the conditions specified . Paragraph 5 of Article L. 145-9 of the Commercial Code emphasizes that the notice must, under penalty of nullity, specify the reasons for which it is given and indicate that the tenant who intends to continue the lease and contest the notice, or request the payment of eviction compensation, has the possibility to bring the matter before the court before the expiration of a two-year period from the date for which the notice was given.

The lessor may give notice with refusal to renew, without stating the reasons for this refusal, provided, however, that an eviction indemnity is paid to the tenant . Also, when notice has been given with an offer of eviction indemnity, an erroneous reason does not constitute grounds for nullity. Indeed, the lessor remains, in all cases, entitled to refuse the continuation of the lease by offering an eviction indemnity, regardless of the reason for the refusal to renew advanced . If the lessor gives notice with refusal to renew and to pay an eviction indemnity, they must, however, specify the reasons against the tenant to justify this refusal. Only reasons deemed legitimate can defeat the tenant's right to the eviction indemnity (Article L. 145-14 Commercial Code). Similarly, the lessor, who terminates the lease at the end of a three-year period, must justify this early termination by invoking the provisions of Articles L. 145-18, L. 145-21, L. 145-23-1, or L. 145-24 (Article L. 145-4, para. 3, Commercial Code).

The obligation to provide reasons also applies to the lessee who gives notice due to retirement or disability. In this case, they must prove that they have indeed applied for retirement benefits or have been granted a disability pension (Article L. 145-4, para. 4, Commercial Code) . However, this obligation to provide reasons does not apply to the lessee who gives notice at the end of a three-year period, as it is sufficient for them to clearly state their intention to terminate the lease without having to justify the reasons for their unilateral decision .

The failure to observe these obligations constitutes a procedural defect that only affects the validity of the act if the omission causes harm to its recipient who invokes it . In the case of an irregular notice given by the lessor at the expiration of the lease term, the lessee, who alone has the power to raise the relative nullity, may choose between waiving this nullity by seeking eviction compensation or relying on it by opting to continue the lease .

In principle, a change of grounds is prohibited, except in the case of a ground discovered after the notice has been given. Thus, the landlord cannot, to oppose the renewal of the lease, subsequently invoke facts that were known to him at the time he gave the notice and that he did not invoke . However, since defenses on the merits can be invoked at any stage, a landlord who has given notice with a refusal to renew may, during the proceedings for the determination of the eviction indemnity, contest the application of the status of commercial leases .

Cass. 3e civ., 19 March 1997, LawLex202200002872JBJ.

Cass. 3e civ., 17 September 2013, LawLex202300009518JBJ.

Cass. 3e civ., 5 January 1993, LawLex202300009504JBJ; 8 February 2006, LawLex202200002971JBJ; 10 February 2015, LawLex202300009505JBJ.

CA Bourges, 9 October 2008, LawLex202200003789JBJ.

Cass. 3e civ., 16 November 1994, LawLex202100003785JBJ.

Failure to mention the foreclosure period: Cass. 3e civ., 19 December 2000, LawLex202200003225JBJ; 25 October 2018, LawLex202200003227JBJ.

Cass. 3e civ., 28 June 2018, LawLex202300009668JBJ.

Cass. 3e civ., 4 May 1973, LawLex202300009506JBJ.

Cass. 3e civ., 3 November 2016, LawLex202200002997JBJ.

Commercial Leases/Business Goodwill

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