Commercial Leases/Business Goodwill

The damage suffered by the lessee due to the lessor's refusal to renew must be assessed on the date of eviction or as close as possible to the departure if the lessee voluntarily leaves the premises . However, the value of the compensation must be assessed on the date the judges rule, when the lessee has not vacated the premises  or when the lessee has assigned the lease right as long as the evict …

Date of assessment

The damage suffered by the lessee due to the lessor's refusal to renew must be assessed on the date of eviction or as close as possible to the departure if the lessee voluntarily leaves the premises . However, the value of the compensation must be assessed on the date the judges rule, when the lessee has not vacated the premises  or when the lessee has assigned the lease right as long as the eviction has not yet occurred . However, abuse, fraud, or delaying tactics may set aside the normal rule of assessing the damage on the day of the tenant's eviction .

The trial court judges must take into account the evolution of the business, which requires examining the operating results after the lease's expiration, as well as at the date of the expert report submission, in order to proceed with an updated calculation of the eviction indemnity . Any updating of the value of the business elements by flat-rate increase or by applying an updating coefficient, even if adopted by the expert, when these have changed before the date on which the trial court judges rule, is however prohibited . The turnover figures corresponding to the period of the Covid-19 health crisis, which disrupted economic activity during the year 2020, are excluded .

Cass. 3e civ., 21 January 1998, LawLex202200005204JBJ, which specifies that the value of the business used as the basis for calculating the eviction indemnity is assessed on the day the tenant leaves; 10 July 2002, LawLex202300012209JBJ, which holds that the amount of the eviction indemnity is assessed as close as possible to the date the tenants leave, taking into account, to evaluate the value of the business, the practices of the profession; 14 March 2019, LawLex202200004437JBJ, according to which the damage caused by the landlord's refusal to renew is assessed on the date the lessee voluntarily leaves the premises; Montpellier, 12 March 2024, LawLex202400002318JBJ.

Cass. 3e civ., 28 September 2011, LawLex202300012212JBJ.

Cass. 3e civ., 2 June 1982, LawLex202300012210JBJ, which overturns the appellate decision that holds, to limit the amount of the eviction indemnity owed by the lessor to the current lessee, to whom the former tenant had transferred their business after the effective date of the notice, that in the sense of Article L. 145-14 of the Commercial Code, the expression “the evicted tenant” necessarily refers to the one who was denied renewal, that it is with regard to the damage suffered by the latter that the eviction indemnity must be assessed, and that therefore only the evolution that the assignor could have brought to the operation of the premises should be considered and not the expansion that the assignee may have imparted. – Also see Cass. 3e civ., 20 October 2016, LawLex202200004442JBJ.

Cass. com., 20 December 1965 LawLex202300012211JBJ.

Cass. 3e civ., 8 March 2011, LawLex202200004820JBJ, which quashes the decision that, to set the amount of the eviction indemnity, refers to the conclusions of the expert appointed by the first judges, whereas the value of the business must be assessed at the date the judges rule and the lessee asserts, in his appeal submissions, that the operating results reflect an increase in his turnover. – Also see Cass. 3e civ., 28 September 2011, LawLex202300012212JBJ, for a lessee who argues in his appeal submissions, the necessary consideration of the balance sheets of the three fiscal years he produced for an updated calculation of the eviction indemnity, by reference to the gross self-financing margin.

Cass. 3e civ., 19 June 1991, LawLex202200004822JBJ, which quashes the appellate decision that, while noting that turnover significantly increased for the years 1986, 1987, and 1988, evaluates the business assets on 1 January 1985 by referring to the average turnover for the years 1983, 1984, and 1985 and applying a 10% increase to the retained value. – Also see Cass. 3e civ., 2 June 1993, LawLex202300011634JBJ, which quashes the appellate decision that evaluates the eviction indemnity with an increase of a 10% adjustment coefficient.

Paris, 30 March 2022, LawLex202200004731JBJ. – See also CA Chambéry, 18 January 2022, LawLex202200005141JBJ.

Commercial Leases/Business Goodwill

274. Date of assessment

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274. Date of assessment

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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