Co-ownership and Commercial Leases: Can One Co-owner Act Alone in Court?

Imagine: you own a commercial property in Pont-à-Mousson with your brother and sister, in co-ownership. The tenant, who runs a bar-disco there, causes unbearable noise nuisance for the neighbourhood. You want to terminate the lease, but your sister is abroad and your brother is hesitant. Can you act alone? The question is crucial: in co-ownership, does every decision affecting the property require unanimous consent? This 1993 decision of the Court of Cassation provides a nuanced answer, depending on the nature of the act and the authority given between co-owners.

The law of co-ownership (a mechanism where several people are joint owners of the same property) is often a source of deadlock. Article 815-3 of the Civil Code, at the heart of this decision, distinguishes between acts of administration (day-to-day management) and acts of disposition (sale, mortgage). But where does a court action to terminate a lease fit? And what happens when one co-owner gives authority to the others? This decision sheds light on these grey areas and protects those who act to preserve the property.

In practice, the Court validates that with a special authority, two out of three co-owners can act alone to terminate a commercial lease, even for nuisances related to a disco. A practical solution to avoid inertia, but one that requires precautions. Analysis.

The Facts: A Common Story

In 1987, Mr. and Mrs. X were co-owners of a business in Nancy, including a bar, a video club, and a disco. They leased the premises to the company Lausanne, which operated a dance hall. Very quickly, noise nuisances and neighbourhood disturbances multiplied: exasperated residents, complaints to the town hall, police reports. The owners decided to act: they wanted termination of the lease and eviction of the tenant.

But there was a catch: they were only two co-owners out of three. The third, Mr. Y, was their co-owner but had not been involved in the proceedings. The owners invoked a special authority that Mr. Y had allegedly given them to take legal action. The tenant, however, contested the validity of this authority and argued that the action was inadmissible for lack of unanimous consent of the co-owners.

The Nancy Court of Appeal ruled in favour of the owners in 1991: it declared the action admissible, considering that the special authority was sufficient. Company Lausanne appealed to the Court of Cassation. The Court of Cassation, in this decision of 24 March 1993, dismissed the appeal and upheld the decision of the Nancy judges. It held that an action to terminate a commercial lease constitutes an act of administration (day-to-day management) for which a special authority given to two co-owners is sufficient, without the need for a general authority.

The Reasoning of the Court — Analysed

To understand, we must delve into Article 815-3 of the Civil Code, which governs the powers of co-owners. This text distinguishes: acts of administration (such as concluding a lease) can be performed by a single co-owner if they have received a special authority from the others; acts of disposition (such as sale) require unanimity, unless there is a special authority. The question was: is a court action to terminate a lease an act of administration or disposition?

The Court of Cassation answers: it is an act of administration, because it aims to manage the property and preserve its value. Indeed, terminating a lease for nuisances avoids depreciation of the business and legal action by neighbours. Therefore, a special authority given by the absent co-owner is sufficient. Here, the Court of Appeal had found that Mr. Y had given a special authority to the other two co-owners to take legal action. This authority was explicit and in writing, which convinced the judges.

The tenant's arguments were strong: they invoked the principle of unanimity in co-ownership (Article 815-3, first paragraph). But the Court held that termination of a lease for breach of the tenant's obligations (here, the nuisances) fell within the normal management of the property. It thus made a pragmatic application of the text, confirming an earlier jurisprudential trend: judges favour the efficiency of co-ownership management, without requiring systematic deadlock.

Note that if the act had been a sale of the business or a mortgage, unanimity would have been required. But for a court action aimed at terminating a lease, flexibility applies, provided there is a valid special authority. An important nuance: the authority must be special, i.e., given for this specific act, and not general. In practice, a simple email or a written document mentioning the purpose of the action may suffice, but a more formal document is better to avoid any challenge.

What This Means for You — Practically

If you are a co-owner of a leased property, this decision gives you a valuable tool. You can act alone in court to terminate a lease if you have a special authority from the other co-owners. Concrete example: in Nancy, you and your brother are co-owners of a commercial property leased to a pizzeria. The tenant has not paid rent for 6 months. You want to sue for termination of the lease. Your brother, who lives abroad, gives you his consent by email to act. This email constitutes a valid special authority, and you can bring the action alone.

For the tenant, beware: you cannot oppose the action simply by invoking the absence of one co-owner. If the owners produce an authority, the action is admissible. On the other hand, if no authority exists, you can challenge admissibility. However, the Court of Cassation has also held that the action can be regularised during proceedings if the other co-owners voluntarily intervene or give authority afterwards.

For purchasers of a co-owned property, be vigilant: check that all co-owners agree on the management of the property. If you buy a co-owned property, require a special authority for any important act. And if you are in co-ownership, do not hesitate to draft a co-ownership agreement specifying each person's powers. This will save you from deadlock.

Four Tips to Avoid This Type of Dispute

• Draft a written co-ownership agreement. From the start of the co-ownership (inheritance, joint purchase), set the rules: who manages the property, which acts require unanimity, and how to give authority. This clarifies roles and avoids conflicts.
• Obtain a written special authority for each court action. Even if you are on good terms, an email, letter, or notarised authority is essential. Specify the exact purpose: "termination of the commercial lease of 1 January 2020 with company X for unpaid rent". A general authority is not enough.
• Keep all evidence of the co-owners' consent. Save emails, letters, meeting minutes. If contested, these documents will be evidence. Remember to date them and, if possible, sign them electronically.
• Consult a lawyer before acting alone. If a co-owner refuses to give authority or is unreachable, a lawyer can advise on alternative solutions: an urgent application to obtain the judge's authorisation, or an action for partition to exit the co-ownership. Prevention is better than cure.

Further Reading: Related Case Law and Developments

This decision is part of a consistent line from the Court of Cassation. Already in 1987 (Civ. 1st, 3 March 1987, No. 85-14.123), the Court had held that a co-owner could act alone to stop a disturbance of enjoyment, without special authority, because it was a preservative act (urgent measure to preserve the property). Here, termination for nuisances is also a preservative act, which explains the solution. In 2006 (Civ. 1st, 14 November 2006, No. 04-18.550), the Court clarified that the special authority must be given by all co-owners, but it can be tacit if circumstances justify it (for example, if one co-owner lets the others act without protest).

Since 1993, the trend has been towards flexibility: judges favour the interest of the co-ownership and avoid deadlock. However, beware: for acts of disposition (sale, mortgage), unanimity remains the rule, unless there is an express special authority. In 2020, the reform of security law reinforced the requirements for authority for mortgages. This shows that the distinction between administration and disposition remains crucial.

Key Points to Remember

• Q: Can I act alone in court to terminate a lease if I am a co-owner?
  A: Yes, if you have a special authority from the other co-owners. This authority must be in writing and specify the purpose of the action.
• Q: What if a co-owner refuses to give authority?
  A: You can apply to the judge in summary proceedings for authorisation to act alone, or request partition of the co-ownership.
• Q: Is a general authority sufficient?
  A: No, it must be special for each act. A general management authority does not allow you to take legal action.
• Q: Can I regularise the action after starting it without authority?
  A: Yes, if the other co-owners voluntarily intervene or give authority during the proceedings, the action becomes admissible.
• Q: Does this rule apply to all leases?
  A: Yes, whether it is a commercial, residential, or agricultural lease. However, for agricultural leases, specific rules exist (control of structures).

Besoin d'un conseil personnalisé ? Contactez Maître Zakine — première consultation 30 min à 45€.

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 →