Single lease for two flats: no novation by separate rent receipts (Court of Cassation, 1974)

Imagine you are the owner of a building in Cannes, renting out two flats to the same tenant for twenty years under a single lease. One day, to simplify management, you calculate the revised floor area of each dwelling and send two separate rent receipts. The tenant, on the other hand, believes that this creates two separate leases, which would allow him, for example, to give notice for only one flat. Who is right? This is precisely the question put to the Court of Cassation in 1974.

This decision, although old, remains relevant for residential leases subject to the 1948 law or occupancy agreements. It establishes a clear principle: novation (transformation of one contract into another) is not presumed. For novation to occur, there must be a clear and unequivocal intention of the parties to modify the object or cause of the contract. However, the mere fact of detailing the rent per flat does not change the legal nature of the single lease.

In short, this decision protects the landlord against an unwanted fragmentation of the lease, but it also requires vigilance: if you genuinely wish to split a single lease into several contracts, you must do so expressly, by way of an addendum or a new lease. undefined, I have come across cases where owners in Valbonne fell into a trap due to their own management, thinking they had changed the contract when they had only altered the payment method.

The facts: a story that happens every day

Mrs X, owner of a building in Cannes, had granted in 1949 a single lease for two flats: one used as a bailiff's office, the other as a dwelling. The tenant was a bailiff, Mr Y. The lease was concluded for a term of three, six, nine, twelve, fifteen and eighteen years, with specific clauses. In 1970, after Mr Y's death, his widow occupied the premises. Mrs X gave her notice for the dwelling flat by registered letter dated 24 November 1970, while maintaining the lease of the office. The widow contested: according to her, the single lease had transformed into two separate leases due to the separate calculation of the revised floor area and the issue of separate rent receipts by the landlord. She therefore argued that the notice for the dwelling flat was valid and that the lease of the office continued separately.

The court of first instance ruled in favour of the widow, finding that there had been a novation (transformation of the initial contract) into two separate leases. Mrs X appealed. The Court of Appeal reversed the judgment: it held that there had been no novation, because the elements relied upon (calculation of floor area per flat, separate rent receipts) only modified the methods of fixing and paying the rent, without changing the object or cause of the initial contract. The widow appealed to the Court of Cassation.

The Court of Cassation dismissed the appeal. It approved the Court of Appeal's finding that the circumstances relied upon did not constitute a novation. Thus, the single lease remained, and the notice given for the dwelling flat was therefore ineffective because a partial termination of a single lease is not possible.

The reasoning of the court — analysed

The central legal issue is that of novation, defined in Article 1271 of the Civil Code (old, now replaced by Articles 1329 et seq. of the new Civil Code). Novation is the extinguishment of an obligation by the creation of a new obligation that replaces it. It is not presumed: the intention to novate must be clear and unequivocal. Here, the Court of Cassation applies this principle strictly.

The lower courts (Court of Appeal) found that the initial lease was single, covering two flats. The landlord, by calculating the revised floor area per flat and issuing separate rent receipts, merely detailed the overall rent. This affects neither the object of the contract (the letting of both flats) nor its cause (the intention to let these two properties together). In other words, it is a simple modification of the payment method, not a change in the nature of the contract.

The Court of Cassation reminds that the assessment of the parties' intention is within the sovereign power of the lower courts. The Court of Appeal did not distort the contract by finding that there was no novation. It merely exercised its power of interpretation. This point is important: in law, the characterisation of a factual situation (such as the intention to novate) is left to the assessment of the lower courts, except in case of legal error.

In other words, this decision confirms that to transform a single lease into several leases, an express act is required, such as an addendum or a new lease. Routine management acts (separate rent receipts, individual calculations) are not enough. However, be aware: if the landlord had, for example, sent two separate notices or concluded two separate renewals, the outcome might be different. What few people know is that novation can also result from unwritten conduct, but it must be clear and unequivocal.

What this means for you — practically

For landlords: if you have a single lease covering several premises, you can continue to issue separate rent receipts for each dwelling without fear of creating separate leases. But be careful: if you genuinely wish to split the lease (e.g., to sell one rented flat), you must formalise this split by an addendum signed by both parties. Without this, the lease remains single, which can complicate a partial sale.

For tenants: if you occupy several flats in the same building under a single lease, you cannot give notice for only one flat. The lease is indivisible. If you wish to leave one flat, you must terminate the entire lease. In Valbonne, a tenant renting a flat and a studio under the same lease cannot give up the studio alone, unless the landlord agrees.

For purchasers: if you buy a building let under a single lease, you must check whether the lease has been split into several leases. If not, you cannot, for example, give notice for only one flat. This can impact the value of the property.

Example: in Cannes, a landlord lets a two-room flat (60 m²) and a studio (25 m²) under a single lease at €1,500 per month. He wishes to sell the studio vacant. He must first split the lease into two separate contracts, which requires the tenant's consent. Without this, the tenant can refuse to vacate the studio, and the sale is blocked. The split can be negotiated, for example by reducing the overall rent by €100 as compensation.

Four tips to avoid this type of dispute

• Draft a clear lease: if you let several flats, state expressly whether it is a single lease or separate leases. Mention the floor area of each premises and the overall or detailed rent.
• Use an addendum for any modification: if you want to split a single lease, have both parties sign an addendum. A mere change in payment method is not enough.
• Keep evidence of your intention: retain correspondence (letters, emails) showing that the parties agreed to change the nature of the contract. Novation is not presumed, but it can be proved in writing.
• Consult a solicitor before giving notice: if you are a tenant and want to leave only one flat under a single lease, be aware that partial notice is invalid. Your solicitor can negotiate a mutual termination with the landlord.

Further reading: related case law and developments

This 1974 decision is in line with a consistent line of the Court of Cassation: novation is strictly interpreted. One can cite a judgment of 3 November 1977 (No. 76-10.392) where the Court held that a change in the amount of rent does not constitute novation. Conversely, in a judgment of 12 May 1993 (No. 91-15.383), it admitted novation when the parties had signed a new lease with substantially different terms (term, use).

The trend is therefore towards protecting the initial contract. Courts are reluctant to consider that a mere change in modalities transforms the nature of the contract. This means that in practice, to split a lease, an express act is required. The recent reform of contract law (Ordinance of 10 February 2016) has maintained this principle: novation is not presumed (Article 1330 of the Civil Code).

Key takeaways

• A single lease remains single until proven otherwise. Separate rent receipts do not transform it into several leases.
• To split a lease, an addendum or a new contract is required. No tacit novation by a mere change in payment method.
• The tenant cannot give partial notice. He must terminate the entire lease or obtain the landlord's consent.
• The landlord must be vigilant: if he wants to sell only one flat, he must anticipate splitting the lease.

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