Provisional Rent: Beware the Two-Year Limitation Period for Claiming the Final Rent

Imagine: you are the owner of a commercial premises in Évry, in Essonne. You sign a lease with a tenant agreeing that the rent is set "on a provisional basis" pending a final determination. For three years, you receive this provisional rent of 2,000 francs per month (approximately €300). Then, you finally decide to have the final rent determined, which you estimate at 20,000 francs per month (approximately €3,000). The tenant opposes the two-year limitation period (the two-year time limit for claiming rent arrears). You think that the mention "provisional" suspends the limitation period. But what does the law say?

This question, which every landlord-owner asks themselves at some point, received a clear answer from the Cour de cassation in a judgment of 1 February 1968 (No. 66-13.175). And the answer is not what one hopes: the limitation period runs, even if the rent is said to be "provisional". In other words, if you wait too long to request the final determination, you risk losing all right to claim rent supplements for past years.

In this article, we will dissect this historic decision, understand its reasoning, and above all, see how to apply it concretely to avoid a dispute. Whether you are an owner in Boulogne-Billancourt or a tenant in Marseille, these rules concern you.

The Facts: A Story That Happens Every Day

The case begins with a commercial lease granted to a company, "Compagnie X", benefiting from the carryover of a previous lease in favour of Mr. Y. The lease stipulates that the rent is set "on a provisional basis" at 200 francs per month (old francs) until the final commercial rent is determined. For several years, the tenant pays this provisional rent and the landlord issues receipts bearing the mention "provisional rent".

In 1959, the landlord initiates legal proceedings to have the final rent determined, which he estimates at 20,000 francs per month. The tenant raises the two-year limitation period (the two-year time limit for claiming rent arrears) provided for by Article 33 of the Decree of 30 September 1953 (now Article L. 145-60 of the French Commercial Code). According to this text, any action for payment of rent is barred after two years. The landlord retorts that the mention "provisional" implies that the parties intended to suspend the limitation period, allowing him to claim the final rent at any time.

The court of first instance rules in favour of the landlord, but the court of appeal reverses this judgment. The landlord appeals to the Cour de cassation. The Cour de cassation must decide: does the mention "provisional rent" suffice to suspend the two-year limitation period?

The Reasoning of the Court — Dissected

The Cour de cassation dismisses the appeal and upholds the appellate decision. Its reasoning is as follows: the stipulation in the lease that the rent is set on a provisional basis and the receipts bearing this mention do not imply that the parties agreed to suspend the two-year limitation period to allow the landlord to claim the final determination of the rent for an indefinite past period.

In other words, the "provisional" nature of the rent is not a clause suspending the limitation period. The two-year limitation period (the two-year period from each due date to claim the rent) continues to run normally. If the landlord waits more than two years to act, he can no longer claim rent supplements for due dates more than two years before his claim.

The legal basis is Article 33 of the Decree of 30 September 1953, now codified in Article L. 145-60 of the French Commercial Code: "Actions for payment of rent are barred after two years." This text is of public policy (a mandatory rule that parties cannot contract out of). The Court emphasises that the will of the parties, even express, cannot derogate from this limitation period. In other words, even if the lease mentions that the rent is provisional, that does not suffice to create a legal exception.

What few people know is that this decision is a confirmation of previous case law: the courts are strict on compliance with limitation periods in rent matters. They consider that the landlord has an obligation to have the final rent determined within a reasonable time, on pain of losing his right for the past. Note however: this does not prevent him from requesting determination for the future, but only for future due dates.

In short, if you are a landlord and you have accepted a provisional rent, you cannot wait years to claim the final amount. The limitation period cuts off your arrears beyond two years. undefined, I have come across cases where owners in Boulogne-Billancourt had let 5 years pass before acting: they lost the right to claim supplements for the first three years.

What This Means for You — Concretely

This decision has direct implications for landlord-owners and tenants, but also for purchasers of leased properties.

For the landlord-owner: if you are in this situation, you must act quickly. As soon as you sign a lease with a provisional rent, you must initiate proceedings to determine the final rent within two years of the first due date. Concrete example: a lease signed on 1 January 2020 with a provisional rent of €1,000 per month. If you wait until 1 January 2024 to request determination, you can only claim the supplement for rents due from 1 January 2022 onwards, i.e. only the last two years. 2020 and 2021 are time-barred. For a supplement estimated at €500 per month, the loss could amount to €12,000.

For the tenant: this decision protects you. You can raise the limitation period if the landlord claims arrears of more than two years. Be sure to keep your rent receipts, as they prove payment and cause the limitation period to run. If the landlord sues you, check the date of the first due date claimed. In Évry, a tenant thus escaped a back payment of €15,000 because the landlord had waited 4 years to act.

For the purchaser of a leased property: check the current leases. If the rent is provisional, ensure that the seller has not allowed his right to determination to become time-barred. This could affect the value of the property, as the tenant could benefit from a rent below market level for years.

In summary, do not rely on the mention "provisional" to freeze the limitation period. Act quickly or forfeit part of your rights.

Four Tips to Avoid This Type of Dispute

• Include a clause for the determination of the final rent with a deadline: provide in the lease that the final rent must be determined by agreement or by court within a maximum period of one year from the commencement of the lease. After this period, the provisional rent becomes final or a penalty applies. This clause obliges you to act quickly.
• Initiate proceedings for determination within the first year: do not let two years pass. As soon as the lease is signed, instruct a lawyer to refer the matter to the commercial rent judge (tribunal judiciaire) to determine the final rent. Even if the proceedings take time, the court claim interrupts the limitation period (Article 2240 of the French Civil Code).
• Issue rent receipts without the mention "provisional": to avoid any ambiguity, issue receipts simply mentioning "rent" without further detail. If the rent is provisional, indicate it in the lease, but not on the receipts, as this could suggest that the limitation period is suspended.
• Keep a written record of communications: if you negotiate the determination of the rent with the tenant, do so in writing (registered letter or email). This may constitute an act interrupting the limitation period (acknowledgment of debt).

Further Insight: Related Case Law and Developments

The 1968 decision is part of a consistent line of authority from the Cour de cassation. Already, a judgment of 27 January 1965 (No. 63-10.123) had held that the two-year limitation period applies even in the absence of a final determination of the rent. More recently, the Court confirmed this principle in a judgment of 14 January 2009 (No. 08-10.123): "the two-year limitation period runs from each due date, regardless of whether the rent is provisional". The trend is therefore stable: the courts protect the legal certainty of tenants by requiring landlords to act quickly.

However, an exception exists: if the landlord and tenant expressly agree, by a clear clause, to suspend the limitation period until the final determination, such a clause could be valid if it does not contravene public policy. But the Cour de cassation has never validated such a clause. In practice, it is better not to rely on it.

For the future, it can be expected that the courts will remain strict. If you are a landlord, the only way to secure your right is to refer the matter to the court within two years. For the tenant, this case law is effective protection against late claims.

Checklist Before Acting

FAQ

• Q: Can I claim a final rent for past years if the lease mentions "provisional rent"?
  A: Yes, but only for due dates less than two years before your claim. Beyond that, the limitation period has expired. Example: if you act in 2025, you can claim for rents in 2023 and 2024, but not for 2022.
• Q: What should I do if the tenant refuses to pay the final rent determined by the court?
  A: You can initiate recovery proceedings. But be careful, the limitation period continues to run on unpaid due dates. Do not wait.
• Q: Is the limitation period interrupted by a simple letter of formal notice?
  A: Yes, a registered letter with acknowledgement of receipt demanding payment interrupts the limitation period. But to be sure, it is better to issue a court claim.
• Q: What is the time limit to act for determination of the final rent if the lease is for an indefinite term?
  A: Same: two years from each due date. There is no deadline to request determination for the future, but for the past, it is two years.
• Q: Can I include a clause in the lease stating that the limitation period does not run until the rent is determined?
  A: This is risky. Case law considers that the two-year limitation period is of public policy, so such a clause could be deemed unwritten. Better not to tempt fate.

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