Commercial Leases/Business Goodwill

The creditor of the eviction indemnity is the evicted lessee (Art. L. 145-14 Commercial Code). The right to be compensated for the eviction arises on the date the notice of termination with refusal to renew the lease is delivered to the lessee. However, two conditions must be met for the lessee to claim payment of this indemnity. They must meet the conditions for access to commercial property and  …

Creditor

The creditor of the eviction indemnity is the evicted lessee (Art. L. 145-14 Commercial Code). The right to be compensated for the eviction arises on the date the notice of termination with refusal to renew the lease is delivered to the lessee. However, two conditions must be met for the lessee to claim payment of this indemnity. They must meet the conditions for access to commercial property and be evicted following a notice.

First, it is imperative that on the date the notice is served by the landlord, the tenant meets the essential conditions provided in Articles L. 145-1 and L. 145-8 of the Commercial Code to claim the eviction indemnity. The lease must concern buildings or premises where the tenant is registered in the trade and companies register or national business register, which have been effectively operated during the three years preceding the lease expiration date by the tenant who owns the business. Thus, an eviction indemnity cannot be granted to a tenant who is not registered in the trade and companies register on the date the notice is served by the landlord, even if the deregistration due to “dormancy” results from the inability to operate their business in the leased premises following the execution of works initiated by the landlord . However, the Court of Cassation considers that these conditions must be met on the date of the renewal request and on the lease expiration date, but not during the procedure for setting the rent of the renewed lease .

Then, the tenant must undergo eviction. No compensation is due in the event of the tenant's voluntary departure , when they have ceased all activity and returned the keys to the rented premises without ever expressing the intention to relocate to another premises , or when the tenant has not been evicted from the premises but has acquired them . The same applies in the case of automatic termination of the lease, based on Article 1722 of the Civil Code, due to the total destruction of the building, or in the event of non-renewal of the lease for a serious and legitimate reason. However, a judicial liquidation procedure does not prevent the payment of eviction compensation if, at the date of the return of the keys, the tenant has been deprived of a right that could give rise to compensation, due to the refusal to renew the lease .

Cass. 3e civ., 18 October 2005, LawLex202100001383JBJ.

Cass. 3e civ., 18 May 2005, LawLex202100001382JBJ.

Cass. 3e civ., 29 September 2009, LawLex202300011690JBJ: in this case, the liquidator had expressed his intention to return the keys to the leased premises before the effective date of the notice.

Cass. 3e civ., 23 May 2012, LawLex202100004639JBJ: in this case, the lessee had ceased all activity due to the fire that damaged the building in which he operated his business.

Cass. 3e civ., 3 March 2009, LawLex202300011691JBJ.

Cass. 3e civ., 16 March 2017, LawLex202300012747JBJ, which overturns the appellate decision that held, to reject the liquidator's claims for the determination of the eviction indemnity, that when the liquidator voluntarily returned the keys, the lessee had ceased operations for four months due to the judicial liquidation procedure leading to the disappearance of its business, and that the refusal to renew the lease caused no harm to the evicted lessee.

Commercial Leases/Business Goodwill

269. Creditor

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Les notions juridiques connexes

269. Creditor

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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