Commercial lease: the joint and several liability of co-tenants does not survive termination

Imagine: you are the owner of commercial premises in Mâcon, rue de la République. You sign a lease with two partners, Pierre and Jacques, who run a café. Everything goes well for five years. Then difficulties arise: the rents are no longer paid, you terminate the lease. The premises remain empty, but you claim the unpaid rents and an occupation indemnity. Who must pay? Both co-tenants, even if one has left the premises? The question every landlord asks: does the joint and several liability signed at the outset survive the termination of the lease?

The answer of the Court of Cassation is clear: no, unless the contract expressly provides otherwise. On the other hand, the person who remains without right in the premises owes an occupation indemnity based on his quasi-delictual fault. In short, the effect of joint and several liability ends with the lease, but the wrongful occupant (the one who stays) pays personally.

This decision of 1 April 2009 (appeal no. 08-13.508) is a reference for all commercial leases. It protects the co-tenant who has left the premises, but reinforces the responsibility of the occupant. Let us explore the facts, the reasoning of the judges and what this changes for you, whether you are a landlord in Digoin or a tenant in Chalon-sur-Saône.

The facts: a story like any other day

Mr X, owner of commercial premises in Chalon-sur-Saône, rents his property to two co-tenants: company Y and company Z. The lease, signed in 1999, contains a joint and several liability clause: each co-tenant undertakes to pay all the rents, even if the other does not pay. In 2003, the rents cease to be paid. The landlord serves a notice to pay, then obtains the termination of the lease in court in 2004.

But company Z, one of the two co-tenants, remains in the premises without paying. The landlord sues both companies for payment of the unpaid rents and post-termination occupation indemnities. The Dijon Court of Appeal orders both co-tenants jointly and severally liable. But company Y, which had left the premises, appeals to the Court of Cassation.

Its argument: the joint and several liability ended with the termination of the lease. Therefore, it does not owe the occupation indemnities, since it no longer occupies. The Court of Cassation agrees. In other words, joint and several liability does not automatically extend to debts arising after the end of the lease. But note: company Z, which remained in the premises, must pay the occupation indemnity because it commits a quasi-delictual fault by remaining without right.

The reasoning of the court — dissected

The Court of Cassation relies on two legal pillars. First, Article 1202 of the Civil Code (old): joint and several liability is not presumed; it must be expressly stipulated. Second, Article 1240 of the same code (formerly 1382): any act whatsoever of man which causes damage to another obliges the person by whose fault it occurred to repair it. In short, the occupation indemnity is not rent, but compensation for occupation without right.

The magistrates reason as follows: the lease contract is terminated, so the joint and several liability clause, which is a contractual clause, disappears unless the parties have provided that it survives. On the other hand, the co-tenant who remains in the premises commits a quasi-delictual fault (in law, quasi-delict means an unintentional unlawful act causing damage). This fault is personal: it cannot be imputed to the other co-tenant who left the premises.

What few people know is that this decision confirms earlier case law. Already in 1999, the Court of Cassation had held that the joint and several liability of the assignee does not survive the termination of the lease (Civ. 3e, 24 February 1999, no. 97-13.850). Here, it extends this principle to co-tenants. So this is a consistent solution: joint and several liability ends with the contract. But why? Because joint and several liability is an exception to the principle that each person is only liable for his own debts. The judges want to prevent a co-tenant from being pursued indefinitely for debts arising after he left the premises.

What this changes for you — concretely

For the landlord: you can no longer claim occupation indemnities from all co-tenants jointly and severally if one of them has left the premises. You must identify the actual occupant and act against him alone. Concrete example: in Mâcon, if you rent to two traders and one leaves before termination, the other stays: after termination, you can only pursue the one who occupies. If the lease contains a clause providing that joint and several liability survives termination, then you can act against all. So, check your leases!

For the tenant co-tenant: if you leave the premises before or at the time of termination, you are released from any obligation for occupation indemnity. However, note: you remain liable for unpaid rents prior to termination, because joint and several liability applies for the contractual period. If you are in Digoin and your partner remains in the premises, you will not have to pay for his occupation. But make sure you have proof of your departure (handover of keys, outgoing inventory).

For the purchaser of a lease: if you buy a business, check whether the lease contains a joint and several liability clause surviving termination. If not, in the event of termination, you will not be jointly and severally liable for occupation indemnities with the former tenant. But if you stay, you will owe them personally.

undefined, I have encountered cases where landlords thought they could seize all co-tenants after termination. Result: months of wasted proceedings. Better to anticipate and draft an express clause in the lease.

Four tips to avoid this type of dispute

• Draft a post-termination joint and several liability clause: in the lease, expressly provide that the joint and several liability of the co-tenants survives termination for all sums due, including the occupation indemnity. Example: "The co-tenants remain jointly and severally liable for occupation indemnities and all damages after the termination of the lease."
• Obtain a personal guarantee: in addition to joint and several liability, ask for a guarantee (individual or legal entity) that undertakes for the entire duration of the occupation, including after termination. Thus, you will have a guarantor even if one of the co-tenants disappears.
• Make a precise outgoing inventory: upon the departure of a co-tenant, draw up an inventory and a deed of assignment of rights. This proves who the remaining occupant is and avoids disputes over the departure date.
• In case of non-payment, act quickly: as soon as the first rent is unpaid, serve a notice to pay. If termination is ordered, seek eviction of the occupant without title. The longer you wait, the more the occupation indemnity accumulates, and you risk only being able to recover it from one co-tenant.

Further reading: related case law and developments

This decision is part of a consistent line of case law. Already in 1999, the Court of Cassation (Civ. 3e, 24 February 1999, no. 97-13.850) held that the joint and several liability of the assignee of a lease does not survive termination. In 2005 (Civ. 3e, 1 June 2005, no. 04-10.594), it specified that the occupation indemnity is due by the person who remains, even if he is not the sole signatory of the lease. Since then, the courts have applied this principle uniformly.

A recent development: in 2022, the Court of Cassation recalled that the joint and several liability clause surviving termination must be "express and unequivocal" (Civ. 3e, 9 March 2022, no. 21-10.042). In other words, a simple mention of "jointly and severally" in the lease is not enough; it must specify that it applies after termination. So, if you are a landlord, have your clauses checked by a lawyer.

What this means for the future: the judges protect the co-tenant who no longer occupies, but leave the parties free to provide for extended joint and several liability. The trend is clear: no joint and several liability without an express clause. So, to your contracts!

Summary and next steps

FAQ:

• Does the joint and several liability of co-tenants survive termination of the lease? No, unless there is an express clause to the contrary.
• Who must pay the occupation indemnity after termination? The co-tenant who remains in the premises, personally.
• Can I sue the former co-tenant who left the premises? No, unless the lease provides for post-termination joint and several liability.
• What should I do if I am a landlord and one of the co-tenants does not pay? Check the joint and several liability clause. If it does not survive, pursue only the occupant.
• How to draft an effective joint and several liability clause? Clearly state that it applies after termination for all sums due (rents, indemnities, damages).

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