Costs in Single Proceedings after Joinder: What Changes with the Judgment of 28 September 2005?

Imagine: you are the owner of a commercial property in Albertville, leased to a ready-to-wear brand. The tenant assigns the lease without your written consent, you initiate proceedings, and eventually the Court of Appeal joins several related cases. At the conclusion, the judge orders your opponent to pay the costs (legal fees) of the single proceedings. Who pays what? This is the question that the French Supreme Court decides in its judgment of 28 September 2005.

This decision, handed down by the third civil chamber, concerns a dispute between Palmer (landlord) and Nomades and Laederiech Boigeol (successive tenants). It recalls an essential principle: when proceedings are joined, the costs of the single proceedings are borne by the unsuccessful party (the party that loses the case), without the judge having to justify it by a specific text. A security for landlords and tenants who engage in complex litigation.

But concretely, what does this rule mean for you, whether you are in Aix-les-Bains or elsewhere? How should you anticipate legal costs in a property dispute? Let us delve into the details of this judgment.

The facts: a story that happens every day

In 1998, Palmer, owner of a commercial property in Rennes, grants a commercial lease to Nomades. The contract includes a forfeiture clause (possibility to terminate the lease in case of non-payment) and prohibits the assignment of the lease without the landlord's written consent. However, in 2000, Nomades assigns the lease to Laederiech Boigeol without informing Palmer. The latter, unhappy, serves a notice to pay invoking the forfeiture clause, then sues both companies.

The Regional Court (Tribunal de grande instance) of Rennes renders a first judgment. Unsatisfied, the parties appeal. The Court of Appeal of Rennes, faced with several related appeals (linked to the same lease), decides to join them into a single proceeding. In February 2004, it renders its judgment: it orders Laederiech Boigeol (the assignee) to pay the costs of the single proceedings, i.e., all legal fees (bailiff, lawyer, possible expert reports).

Laederiech Boigeol challenges this order: according to it, the Court of Appeal could not order it to pay costs without specifying the legal basis, since the texts on costs (Articles 696 et seq. of the French Code of Civil Procedure) refer to a single proceeding, but not explicitly to the case of joinder. It appeals to the Supreme Court.

The reasoning of the court — dissected

The French Supreme Court, in its judgment of 28 September 2005, dismisses the appeal. It holds that the Court of Appeal legally justified its decision. The reasoning consists of three points:

1. Joinder creates a single proceeding. When the judge joins related proceedings (linked by the same dispute), it merges them into one proceeding. Consequently, the rules on costs apply to this single proceeding, not to each proceeding separately. The Court of Appeal did not have to distinguish between the different appeals.

2. The discretionary power of the judge. Article 696 of the French Code of Civil Procedure provides that the losing party is ordered to pay costs, unless the judge gives a reasoned decision to the contrary. Here, the Court of Appeal exercised this power by ordering Laederiech Boigeol, which had lost on the merits (it had assigned the lease without authorisation). No text required it to justify further.

3. No violation of Article 1134 of the Civil Code (predecessor of Article 1103, on the binding force of contracts). Laederiech Boigeol invoked this article to argue that the forfeiture clause was not applicable. But the Court of Appeal had already decided this point in favour of the landlord. The Supreme Court did not overturn this assessment.

In summary, the French Supreme Court confirms that the appeal judge retains discretion to allocate costs after joinder. This is a pragmatic solution: it avoids endless debates on the allocation of costs between several proceedings.

What this changes for you — concretely

If you are a landlord in Aix-les-Bains, this decision protects you. Imagine that your commercial tenant assigns its business without your consent. You bring an action for termination of the lease, but the assignee disputes it, and the litigation drags on. The Court of Appeal joins the first instance and appeal proceedings. Result: if you win, the assignee will pay all costs, including those of the appeal. Without this rule, you could have been ordered to pay part of the costs, even if you won.

For a tenant, caution is required. If you are sued for breach of the lease, and several proceedings are joined, you risk bearing all costs if you lose. Example figures: bailiff fees (€200), lawyer fees (€1,500), and expert report fees (€3,000) can quickly add up. Better to negotiate an amicable agreement before reaching the appeal stage.

For a buyer of commercial premises, check that the seller obtained the landlord's consent for the assignment of the lease. Otherwise, you could be drawn into termination proceedings and ordered to pay the costs of a single proceeding if several actions are joined.

Four tips to avoid this type of dispute

• Always obtain written consent for any assignment of lease. Have the landlord sign an amendment to the lease, even for a partial assignment. This avoids any dispute on the merits.
• Keep all payment receipts. Rent receipts, bank statements: in case of a notice to pay, these documents prove your good faith and can limit costs.
• Prefer mediation before trial. In Albertville, a property mediator can help you reach an agreement in a few weeks, for a few hundred euros, compared to thousands of euros in legal costs.
• Anticipate the forfeiture clause. If you are a tenant, negotiate a grace period (e.g. 30 days) to pay overdue rent before the clause is triggered.

Further reading: related case law and developments

This judgment is part of a consistent line of decisions by the French Supreme Court. Already, in a judgment of 17 June 1998 (No. 96-18.456), it had held that the joinder of proceedings does not change the principle that costs are borne by the losing party. More recently, the Court clarified that the judge can order multiple parties to be jointly and severally liable for costs (Civ. 2nd, 12 May 2016, No. 15-18.234). The trend is therefore towards simplification: the judge has broad discretion to allocate costs, without being hindered by excessive formalities.

For the future, this case law secures landlords, who can bring termination proceedings without fear of having to bear the costs of multiple proceedings. On the other hand, it encourages tenants to quickly rectify breaches (payment of rent, compliance with clauses) to avoid being ordered to pay costs.

Key points to remember

FAQ:

• What are costs? These are mandatory legal fees: bailiff fees, expert report fees, stamp duties, etc. Lawyer fees are in principle excluded, unless the judge decides otherwise under Article 700.
• Can I challenge an order for costs after joinder? Yes, but only if the judge abused his or her discretion (for example, by ordering a party that did not lose). Otherwise, the French Supreme Court upholds the decision.
• What is the time limit to pay costs? Generally, the court decision sets a deadline (often 1 month). Failing that, the creditor can initiate enforcement proceedings.
• What if I am ordered to pay costs but cannot afford them? You can request a payment schedule from the enforcement judge, but late interest will apply.
• Does this decision apply to residential leases? Yes, the principle is general: it applies to all civil litigation, including residential leases.

Do you find yourself 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 →