Commercial lease: challenging without losing your rights, what does the law say?

You are the owner of commercial premises in Albertville. Your tenant has not paid rent for three months. You apply to the interim relief judge (the emergency judge) to have the lease terminated. But your tenant, instead of paying, argues that the contract is fraudulent, that the service charges are excessive, in short that there is a "serious dispute". And what if this ground paralyses your action? The Court of Cassation, in a ruling of 19 March 1986 (n° 84-17.524), decided: this dispute is not a plea of lack of jurisdiction, so you can discuss it after having defended your position. Analysis.

The facts: a story like any other

In Normandy, the Y... couple rents commercial premises to the X... couple. The lease provides for a monthly rent of 1,500 francs (approximately 230 euros). Very quickly, the tenants stop paying. The owners apply to the Tribunal de grande instance of Caen to have the lease terminated and obtain eviction. At first instance, the interim relief judge grants their request. The tenants appeal. Before the Cour d'appel of Caen, they raise a ground: the lease would be tainted by nullity, there would be a serious dispute prohibited before the interim relief judge. But they do so after having already argued on the merits. The Cour d'appel rejects their argument, considering that this ground should have been raised "before any defence on the merits", like a plea of lack of jurisdiction. The tenants appeal to the Court of Cassation. The Court of Cassation quashes the judgment: a serious dispute is not a plea of lack of jurisdiction, it can be raised at any stage of the proceedings. The parties are referred back to the Cour d'appel of Rennes.

The reasoning of the court — analysed

The Court of Cassation relies on Article 74 of the Code of Civil Procedure (concerning procedural pleas) to say that a serious dispute is not one of them. What is a plea of lack of jurisdiction? It is a ground by which one tells a judge that he does not have the power to hear the case. For example, a property dispute involving more than 10,000 euros must go before the tribunal judiciaire, not the local judge. If this plea is raised, it must be done at the very beginning of the proceedings, before discussing the merits. But a serious dispute does not challenge the jurisdiction of the interim relief judge. It relates to the merits: is the lease valid? Are the service charges due? The interim relief judge can very well find that there is a serious dispute and refer the case to the trial judge. But he can also, if he considers the dispute unfounded, decide the matter himself. In short, a serious dispute is a ground on the merits, not a question of jurisdiction. The Court of Cassation here confirms its previous case law: it recalls that the interim relief judge has the power to assess the existence of a serious dispute and, if it is not established, to grant the application. The judgment of the Cour d'appel is therefore annulled: the tenants had the right to raise the serious dispute after having defended their position on the merits.

What this changes for you — concretely

For landlord owners (like those in Albertville or Aix-les-Bains), this decision is reassuring: if your tenant invokes a serious dispute after having already contested the rent on the merits, the ground is not inadmissible for that reason. But be careful, this does not mean that the interim relief judge will necessarily rule in your favour. He will examine the dispute and, if it is serious, may refer the case to the trial judge, which lengthens the delays. Concrete example: a commercial lease in Aix-les-Bains with a rent of 2,000 euros per month. The tenant has not paid for six months (12,000 euros in arrears). You apply to the interim relief judge for termination. The tenant argues that the lease is void because it was signed by an unauthorised person. If he raises this dispute after having already contested the amount of rent, the ground is admissible. The judge will assess: if the nullity is obvious, he will refer; otherwise, he may order eviction. For tenants, this case law allows them to preserve their grounds of defence without fear of preclusion. Concretely, if you are a tenant and you discover a defect in the lease late, you can still raise it. But be careful: a serious dispute may lead to a referral to the trial judge, which delays the decision and increases costs.

Four tips to avoid this type of dispute

• Draft a clear and complete lease: specify the exact identity of the parties, the term, the rent, the service charges, the forfeiture clauses. A well-written lease reduces disputes.
• Instruct a solicitor from the drafting stage: 300 to 500 euros in fees can save you thousands of euros in legal costs.
• In case of non-payment, act quickly: a formal notice by registered letter with acknowledgement of receipt, then an application for interim relief within two months. The longer you wait, the more arrears accumulate and the more arguments the tenant will have.
• Keep all evidence: receipts, correspondence, photos of the inventory of fixtures. In the event of a serious dispute, these elements allow the judge to decide quickly.

Further analysis: related case law and developments

This 1986 decision is part of a consistent line of the Court of Cassation. Already in 1981 (Civ. 2e, 18 November 1981, n° 80-14.561), the Court had held that a serious dispute is not a plea of lack of jurisdiction. Since then, it has reaffirmed this principle several times (Civ. 2e, 10 January 1990, n° 88-17.234; Civ. 3e, 8 April 2009, n° 08-11.234). The trend is therefore stable: the interim relief judge retains broad discretion. However, the reform of the appeal procedure with the decree of 6 May 2017 strengthened the obligation to file submissions within time limits. It is therefore prudent for the parties to raise all grounds as early as possible, even if a serious dispute can still be invoked after the merits. In the future, one might see an evolution towards greater procedural rigour, but for now, this principle remains established.

In practice: what to do

FAQ: frequently asked questions

1. Can I raise a serious dispute after having already contested the amount of rent? Yes, according to this decision, it is not a plea of lack of jurisdiction, so you can do so at any time.
2. What is the risk if I raise a serious dispute? The interim relief judge may consider it serious and refer the case to the trial judge, which lengthens the procedure by 6 to 12 months and increases costs.
3. What should a landlord do when faced with a serious dispute? Provide all evidence that the dispute is unfounded (valid lease, rent due). If the judge agrees with you, he may order eviction.
4. What are the time limits for applying for interim relief? You can apply to the interim relief judge as soon as the first non-payment occurs. He generally rules within 1 to 2 months.

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