Prescription of Additional Rent: When the Lessor is Unaware of the Amount Due

Imagine: you are the owner of a commercial property in Pornic, let to a national chain. The lease provides for a variable rent indexed to turnover. For years, you receive declarations from the lessee but without checking. One day, you realise that she has under-declared and you claim the additional rent. Too late, you are told: it is statute-barred. But is that really fair when it is the debtor who holds the information? This question was decided by the Court of Cassation in 1996, with a solution that remains relevant today.

The decision of 21 February 1996 (No. 94-14.821) is a salutary reminder for lessors: the judge must consider whether the creditor could have known of his claim. For the five-year limitation period (Article 2277 of the Civil Code, now Article 2224) does not apply mechanically. If the lessee does not declare the necessary information, the period does not run. A victory for common sense, but one that requires proper pleading.

In this article, I tell the story of this case, analyse the judges' reasoning, and give you practical advice to avoid losing your claims. Whether you are a lessor in Saint-Nazaire or a lessee in Nantes, you will find keys to understanding your rights.

The Facts: A Story Like Many Others

The company Pierre Romet, owner of commercial premises in Angers, had let them to the company Prisunic. The contract provided for a base rent supplemented by additional rent indexed to the turnover achieved on the premises. Each year, the lessee was required to provide a declaration of its turnover, allowing the additional rent to be calculated.

For several years, Prisunic sent its declarations, but without the lessor challenging them. It was only in 1991 that Romet, after a check, realised that the declarations had been understated. It then claimed the additional rent for the years 1986 to 1990. The lessee raised the five-year limitation period under Article 2277 of the Civil Code: rent due for more than five years would be statute-barred.

Before the Angers Court of Appeal, the lessor argued that it could not have known the exact amount of the additional rent, as this depended on the lessee's declarations. However, the limitation period cannot run against a creditor unaware of his claim, especially when the debtor is the only one holding the information. The Court of Appeal rejected this argument: it considered that Article 2277 does not make the limitation period conditional on the certainty of the claim, and declared the claim statute-barred for the period before 1986.

Romet appealed to the Court of Cassation. The Court of Cassation upheld the appeal: it quashed the Angers judgment on the ground that the Court of Appeal had not responded to the lessor's submissions. Indeed, the judges must consider whether the creditor could reasonably have known of his claim, failing which the limitation period cannot be raised. The case was remitted to the Rennes Court of Appeal.

The Reasoning of the Court — Analysed

The Court of Cassation relied on Article 455 of the new Code of Civil Procedure (now Article 458 of the same Code). This provision requires judges to respond to the parties' submissions. In this case, the Angers Court of Appeal had simply stated that the five-year limitation period applied without any condition of certainty, without examining the lessor's argument that he was unaware of his claim.

In law, the five-year limitation period for rent (Article 2277 of the Civil Code, now Article 2224) aims to protect the debtor against the accumulation of old debts. But this protection is not absolute: it presupposes that the creditor had the opportunity to act. However, if the amount of the claim depends on information known only to the debtor (here, the turnover), the creditor cannot exercise his right until the debtor has provided the necessary information.

This decision confirms earlier case law: the Court of Cassation had already held, in a judgment of 8 July 1986, that the limitation period does not run against a creditor unaware of his claim, particularly when the debtor is required to provide declarations. Here, the higher court goes further by sanctioning the failure to respond to submissions. This is an important procedural reminder: the lower courts must give reasons for their decision on each contested point.

The central question is therefore: could the lessor have known of his claim? The answer is no, as long as the lessee had not declared the exact turnover. The limitation period cannot therefore run before that declaration. In practice, this means that the five-year period only begins to run from the moment the lessor becomes aware of the information enabling him to calculate the additional rent.

What This Means for You — Practically

For lessor owners, this decision is a lifeline. If you let premises with a variable rent (turnover, profits, etc.), you are not trapped by the limitation period if the lessee does not provide you with accurate data. Concrete example: in Saint-Nazaire, a lessor claimed €15,000 in additional rent for the years 2015-2020. The lessee raised the limitation period for 2015-2016. Thanks to this judgment, the lessor was able to show that he had only received the accurate declarations in 2021; the limitation period therefore only ran from that date.

For lessees, beware: you cannot hide behind the limitation period if you have yourself concealed information. The case law requires good faith. If you have under-declared, the lessor may still act even after five years. Conversely, if you have provided complete declarations and the lessor has not claimed anything, the limitation period will normally apply.

For purchasers of let properties, check the review clauses and previous declarations. You could inherit unpaid claims if the lessee understated its declarations. A prior audit is recommended.

Four Tips to Avoid This Type of Dispute

• Require annual written declarations: in your lease, oblige the lessee to provide each year a certified turnover declaration, with acknowledgment of receipt. In case of default, put them on notice by recorded delivery letter.
• Check declarations within a reasonable time: do not let years go by without checking. A delay of three years may be tolerated, but beyond that, you risk losing all or part of your claim.
• Instruct an accountant: for complex leases, an annual audit can reveal discrepancies. The cost is modest compared to the sums at stake.
• Keep all documents: leases, amendments, declarations, correspondence. In case of dispute, you will need to prove the date on which you became aware of the claim.

Further Reading: Related Case Law and Developments

The Court of Cassation confirmed this solution in a judgment of 13 March 2001 (No. 98-22.903): the limitation period does not run against a lessor unaware of the amount of additional rent, in the absence of a declaration by the lessee. Similarly, for variable rents indexed to turnover, the limitation period starts on the date the lessor became aware of the necessary information (Civ. 3e, 12 July 2000, No. 98-20.626).

The trend is therefore favourable to lessors, but with a limit: the lessor must act as soon as he becomes aware of his claim. A prolonged silence after discovery could be interpreted as a waiver. Since the 2008 reform, the limitation period has been five years (Article 2224), but the starting point remains knowledge of the claim.

Checklist Before Acting

• Q: Can I claim additional rent from more than five years ago? A: Yes, if you demonstrate that you were unaware of its existence, for example because the lessee did not provide accurate declarations.
• Q: What if the lessee does not respond to my request for a declaration? A: Put them on notice by recorded delivery letter. In the absence of a response, you can apply to court for an order to disclose the documents.
• Q: What is the time limit to act after discovering the claim? A: Five years from actual knowledge. After that, the limitation period applies.
• Q: Can I include a clause in the lease to avoid the limitation period? A: Yes, a clause providing that failure to declare interrupts the limitation period is valid, subject to compliance with public policy.
• Q: What does a lessee risk for under-declaring? A: In addition to paying the additional rent with interest, they may be ordered to pay damages for bad faith.

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