Notice Cancelled and Co-Tenants: The Lease Automatically Renews for the Other

Imagine: you are the owner of a commercial premises in Saint-Lô, let to two partners. You want to recover the premises to install your son. You serve a notice (letter terminating the lease) on your two tenants, six months before the term. One of them challenges this notice in court and succeeds: the notice is cancelled. The other tenant, however, waives his right to renewal (extension of the lease). You rub your hands together: you thought that the waiver of one was enough to terminate the lease for all. But the Cour de cassation decided otherwise. What happened? And above all, what can you do to avoid this trap?

This decision of 6 July 1983, handed down by the Cour de cassation (the highest French judicial court), answers a crucial question for any landlord and any tenant: when a notice is cancelled for one of the co-tenants, the lease is deemed never to have been terminated. A waiver by one alone is not enough to prevent renewal in favour of the other. The lease therefore automatically renews for nine years, as if the notice had never existed.

In other words, the landlord must serve a valid notice on all co-tenants. If one of them gets it cancelled, the lease continues for all those who have not validly waived. A lesson to remember, especially in commercial leases where every detail counts.

The Facts: A Story Like Many Others

In this case, a female owner (Mrs X) had granted a commercial lease (letting of premises for a commercial activity) to two tenants, Mr A and Mr B. Wishing to recover the premises to operate them herself, she served a notice (an act by which the landlord notifies the tenant of his intention not to renew the lease) on both tenants, respecting the legal period of six months before the expiry of the lease (Article L. 145-9 of the Commercial Code, which imposes this period).

One of the tenants, Mr A, challenged this notice before the tribunal d'instance, arguing that the reasons given were not genuine. He obtained a judgment cancelling the notice, which became final (not subject to appeal). Meanwhile, the other tenant, Mr B, waived his right to renewal of the lease (i.e., he agreed to leave at the end of the lease).

The owner, believing she was free, then let the premises to a new tenant. But Mr A took legal action to have it declared that the lease was renewed in his favour. The Rennes Court of Appeal ruled in his favour, and the Cour de cassation confirmed. The reasoning is inexorable: since the only notice served was cancelled, it is deemed never to have existed. Consequently, the lease was automatically renewed for a period of nine years, in accordance with Article L. 145-9 of the Commercial Code. Mr B's waiver has no effect on Mr A, because the lease did not terminate.

The Reasoning of the Court — Analysed

The Cour de cassation relies on Article L. 145-9 of the Commercial Code (formerly Article 5 of the Decree of 30 September 1953), which provides: 'The owner who intends to oppose the renewal of the lease must notify the tenant, at least eighteen months before the expiry of the lease, of a notice expressly stating the reasons alleged.' The Court deduces that the notice is a single act which must be served on all tenants. If it is cancelled at the request of one of them, it disappears for all.

But why is Mr B's waiver not enough? Because a waiver of renewal (an act by which the tenant agrees not to extend the lease) only has effect if the lease terminates. However, in the absence of a valid notice, the lease renews by operation of law (automatically). Mr B's waiver cannot apply to a lease that has not ended. It is a bit like saying 'I waive my dessert' when the dish has not even been served: the waiver is pointless.

This decision is neither a reversal nor an evolution: it applies a constant rule: the notice must be valid for all tenants. If one of them successfully challenges it, the others cannot, by their waiver, save the notice. The landlord must therefore ensure that his notice is unchallengeable, failing which he will have to serve a new one.

The owner's arguments (that Mr B's waiver should bring the lease to an end) were rejected: an individual waiver cannot create a notice where there was none. In short, the landlord cannot have it both ways: either he serves a valid notice, or he negotiates an amicable departure with all tenants.

What This Means for You — Practical Implications

For Landlords: You must be extremely vigilant when serving notice on multiple tenants. A single successful challenge by one of them cancels the notice for all. Example: in Coutances, you let premises to two traders. You give them notice to sell the premises. One of them challenges the reason (for example, he proves that you do not intend to sell). If the court cancels the notice, the lease is renewed for nine years, even if the other tenant agrees to leave. Consequence: you cannot freely dispose of the premises. To avoid this, make sure your notice is based on a genuine and serious reason (repossession for habitation, sale, reconstruction, etc.) and that it is served on each tenant.

For Co-Tenants: If you are one of the two tenants and your co-tenant waives renewal, that does not bind you. You can demand renewal of the lease if the notice is cancelled. Never agree to waive without consulting a lawyer, as you could lose your rights. Example with figures: in Saint-Lô, a commercial lease with an annual rent of €12,000. If the lease is renewed, you keep your business and its value (often several years' rent). If you waive, you lose your right to renewal and must leave the premises.

For Purchasers of Commercial Premises: Before buying premises, check that there is no ongoing dispute over a notice. A cancelled notice means the lease is renewed, and you inherit a tenant you cannot easily evict. Example: you buy premises in Coutances. The seller tells you the tenant is leaving in six months. But if a co-tenant has had the notice cancelled, the tenant stays for nine years. Your investment could be compromised.

Four Tips to Avoid This Type of Dispute

• Tip 1: Verify the strength of your reason for notice. Before serving a notice, build a solid case: prove that you are recovering the premises for yourself, your spouse, or a descendant, or that you are selling, etc. A fictitious or poorly supported reason will be cancelled.
• Tip 2: Serve the notice on each tenant individually. Do not rely on a single send. Each co-tenant must receive a notice in their name. Use registered letter with acknowledgment of receipt, and keep the delivery proofs.
• Tip 3: Obtain a written agreement from all tenants. If you want the lease to end, negotiate an amicable departure with all tenants. Have each sign a settlement agreement waiving renewal or agreeing to leave on a specific date.
• Tip 4: Consult a specialist lawyer before any action. Commercial lease law is technical. A lawyer will prevent costly mistakes. For example, in Saint-Lô, an owner lost three years' rent for improperly serving his notice.

Further Reading: Related Case Law and Developments

This decision is part of a consistent line of Cour de cassation rulings. One can cite a decision of 17 December 1969 (No. 68-10.456) which already held that 'a notice served on one co-tenant can have effect on the others only if it has also been notified to them'. More recently, in a decision of 5 July 2018 (No. 17-18.256), the Court recalled that a waiver of renewal by a co-tenant is only valid if it occurs after the notice takes effect. Here, since the notice was cancelled, there is no taking effect.

The courts' tendency is therefore protective of tenants: the landlord must strictly comply with formalities. In the future, it is likely that this case law will continue, as it ensures the stability of commercial leases, a major economic issue. For landlords, the lesson is clear: do not take shortcuts.

Frequently Asked Questions

1. What should I do if my co-tenant waives renewal but I want to stay? You can demand renewal of the lease if the notice is cancelled. Your co-tenant's waiver does not bind you. You must go to court to have the renewal declared.
2. Can I serve notice on only one of the two tenants? No, the notice must be served on all co-tenants. Otherwise, it is void as a whole.
3. What are the time limits for challenging a notice? You generally have a period of two months from the notification of the notice to take legal action. After this period, you lose your right to challenge.
4. What is the cost of proceedings to cancel a notice? Costs can vary from €1,000 to €5,000 depending on complexity, not including legal fees. But the stakes (value of the lease, business goodwill) are often much higher.
5. What happens if the landlord serves a new notice after the cancellation of the first? He can do so, but he must again respect the six-month notice period before the expiry of the renewed lease. Caution: the renewed lease has a new term of nine years.

Are you in a similar situation? A first 30-minute consultation with Maître Zakine (€45) can save you months of proceedings — and often much more. Book an appointment →