Lease Without Specified Use: Can a Tenant Change Business Activity Without the Landlord's Consent?

Imagine: you own a commercial property in La Ciotat, rented for years to a carpenter. One day, he tells you he wants to turn the workshop into a hairdressing salon. You are outraged: that was not the intended activity! But what does the lease say? If it is silent on the use of the premises, does the tenant have the right to change activity without your consent? This question is asked by hundreds of landlords and tenants every year.

The Court of Cassation, in a judgment of 4 June 1971 (No. 70-11.415), gave a clear answer: where a lease does not mention the use of the premises, nor any restriction on the exercise of an activity, the mere mention of a profession by the tenant in the contract is not sufficient to prohibit him from carrying on another activity. In other words, the tenant retains his professional freedom, and the landlord cannot seek termination of the lease on that ground.

This decision, handed down more than fifty years ago, remains a reference for all so-called “free” leases or those without a use clause. In this article, we will dissect the facts, the judges' reasoning, and most importantly, give you practical advice to avoid disputes. Whether you are a landlord in Arles, a tenant in Marseille, or a property professional, this decision concerns you.

The Facts: A Story That Happens Every Day

Mr. Chappaz, tenant of a commercial property for professional use, had signed a lease in which he described himself as a “cabinetmaker”. The contract did not specify any use of the premises or any restriction as to the activity carried on. A few years later, Mr. Chappaz decided to change activity and start selling furniture and art objects. The landlord, unhappy, considered this change a breach of the lease and brought proceedings to terminate the contract and evict the tenant.

The landlord relied on the fact that the tenant had described himself as a cabinetmaker in the lease, which, he argued, showed the parties' intention to limit the activity to that profession alone. He argued that the tenant could not unilaterally change the object of the contract. The Court of Appeal, at first instance, found for the landlord and ordered termination of the lease. But the tenant appealed to the Court of Cassation.

Before the Court of Cassation, the debate focused on the interpretation of the contract. The tenant argued that the lease contained no use clause, and that in the absence of an express restriction, he was free to carry on any commercial activity. The High Court had to decide: does the mere mention of a profession in the lease amount to an exclusive use? The stakes were high, as many commercial leases, especially older ones, do not contain a precise use clause.

The Court's Reasoning — Explained

The Court of Cassation set aside the judgment of the Court of Appeal. It held that the lower court had violated the law by failing to consider whether the lease contained a restriction. The reasoning was as follows: the tenant's adoption of a specific professional description in the lease cannot be interpreted as showing an intention to carry on only that activity. In other words, describing oneself as a “cabinetmaker” in the contract does not mean that one is prohibited from being something else.

The Court relied on the principle of contractual freedom and the absence of an express prohibition. It stated that the parties had not intended to impose any limitation on the tenant's professional freedom. Therefore, the change of activity did not constitute grounds for termination. This was not a reversal of precedent, but a confirmation of a liberal trend: in case of doubt, the tenant is free.

It is important to understand the legal basis: Article 1134 of the Civil Code (old version) provides that agreements lawfully entered into take the place of law for those who have made them. But the agreement must be clear. Here, the silence of the lease as to use does not allow a restriction to be implied. The Court of Cassation requires that the clause be express to limit the activity. Thus, a landlord who wishes to restrict the tenant to a specific activity must explicitly state it in the lease.

What This Means for You — In Practice

For landlords, this decision is a warning: if you rent out premises without specifying the use, your tenant can carry on almost any commercial activity, subject to planning and co-ownership rules. You cannot oppose a change of activity unless you can prove harm (nuisance, diminution in value). For example, a landlord in Arles who rents a property to a florist without a use clause cannot prevent him from opening a late-night grocery store, even if it disturbs the neighbourhood.

For tenants, this is a valuable freedom. You can adapt your activity to market changes without risking termination of the lease. However, be careful: if you have signed a lease with a specific use (e.g., “bakery”), you must comply with that clause. Otherwise, you are free. A tenant in Marseille can thus switch from selling clothes to fast food, provided regulations allow it.

For purchasers of a business, always check the lease: if it is silent on use, you have great flexibility. But this can also be a drawback if you want a specific activity and the seller was carrying on a different one: the lease does not protect you against a subsequent change.

Finally, for co-owners: a change of activity may violate the co-ownership rules. Even if the lease is silent, the tenant must comply with restrictions imposed by the co-ownership. A noisy or dangerous activity may be prohibited independently of the lease.

Four Tips to Avoid This Type of Dispute

• Draft a precise use clause: if you are a landlord, include in the lease a detailed description of the permitted activity (e.g., “bakery-pâtisserie with takeaway”). Add a clause prohibiting any change without written consent.
• Include an automatic termination clause: in case of unauthorised change of activity, stipulate that the lease will be terminated automatically. This will facilitate any legal action.
• Check the co-ownership rules: before signing a lease, ensure that the intended activity complies with the rules. If the rules prohibit certain activities, mention this in the lease.
• Consult a lawyer before changing activity: if you are a tenant and your lease is silent, do not hesitate to seek legal advice before making the change. A simple letter to the landlord can avoid litigation.

Further Reading: Related Case Law and Developments

This 1971 decision is part of a liberal line of authority. One can cite a Court of Cassation judgment of 17 March 1993 (No. 91-15.648) which held that the mention of an activity in the lease does not constitute a contractual use if it is not accompanied by an express clause. However, a judgment of 10 February 1999 (No. 96-20.836) added a nuance: if the tenant carries on an activity different from that mentioned in the lease, the landlord may claim damages if he proves harm.

The current trend is to protect freedom of enterprise. Courts are reluctant to impose implied restrictions. However, for leases concluded after the Pinel Law (2014), standard clauses exist and the use is often specified. The 1971 decision therefore remains most relevant for older or poorly drafted leases.

In Practice: What to Do

FAQ:

• Can I change activity if my lease mentions a profession but has no use clause? Yes, according to this decision, the mere mention is not enough to limit your activity.
• Can my landlord refuse my change of activity? No, unless the lease contains an express use clause or your activity causes abnormal disturbance.
• What are the risks if I change activity? You could be sued for breach of lease, but you have a strong chance of winning if the lease is silent.
• Do I have to inform my landlord? It is advisable to do so by registered letter, to avoid a dispute and prove your good faith.
• What if I am a landlord and my tenant changes activity? First check the lease. If it is silent, try to negotiate. If that fails, consult a lawyer to assess legal action.

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