Contractual Breaches
| Ground | Recognised? | Key conditions / limits |
|---|---|---|
| Contractual Breaches | ||
| Change of use without déspécialisation | YES | Any modification of permitted use; tenant’s only defence is implied inclusion (déspécialisation incluse) |
| Rent arrears / payment failures | CONDITIONAL | Must be inexcusable and repeated; late payments brought current monthly = insufficient; economic difficulty or landlord’s own breach may defeat the ground |
| Unauthorised assignment or subletting | YES | Subletting without landlord participation = irreversible (Cass.); a ceased subletting can still qualify if it previously prevented a rent increase |
| Unauthorised works | CONDITIONAL | Only where genuinely irregular; works rendered necessary by an accepted activity do not qualify |
| Failure to insure | YES | Recognised ground (CA Paris) |
| Cessation of Activity | ||
| Cessation of fonds de commerce | CONDITIONAL | Duration alone is not the criterion; health/maternity reasons excluded; observation period cessation (sauvegarde/redressement) cannot be invoked |
| Failure to operate the authorised activity specifically | YES | Confirmed even where business operated generally (Cass. 3e civ., 14 June 2006) |
| Non-Contractual Conduct | ||
| Criminal conduct in premises (prostitution, drug trafficking) | YES | Recognised by Paris CA case law |
| Physical or verbal violence; document falsification in proceedings | YES | Cass. 3e civ. confirmed |
| Persistent co-ownership rule non-compliance with aggressive conduct | YES | CA Rouen 2023 |
Change of Use or Designated Activity
Any modification of the contractual permitted use, including adding a connected or complementary activity without following the déspécialisation procedure, can constitute a serious and legitimate ground (Cass. 3e civ., 24 October 1990). The tenant’s only defence is to argue that the new activity was impliedly included in the original permitted use (déspécialisation incluse). An unauthorised change of physical use (e.g. using the residential part of mixed-use premises for commercial purposes) can also qualify, though not every misuse automatically reaches the threshold.
Rent Arrears and Payment Failures
Failure to pay rent or service charges can constitute a serious ground, but the bar is high: the arrears must be inexcusable and repeated (Cass. 3e civ., 29 June 2005). A pattern of late payments of one to two months without any actual unpaid balance at the time of the notice is not sufficient (CA Paris, 13 May 2020). Difficult economic circumstances can defeat the ground (CA Paris, 27 February 2007). The landlord who is themselves in serious breach of their maintenance obligations cannot invoke rent arrears (CA Paris, 29 February 2024). Because arrears are reversible, the prior formal notice must be served, and if the tenant pays within the month the ground is erased — regardless of how often the same pattern has previously occurred.
Unauthorised Assignment, Subletting, or Management Lease
An assignment without the landlord’s authorisation, or in breach of contractual formalities, is a well-established ground (Cass. 3e civ., 25 June 1975; Cass. 3e civ., 21 November 2001). Subletting without the landlord being called to participate in the act is treated as irreversible by the Court of Cassation (Cass. 3e civ., 9 July 2003), though some Paris CA decisions treat it as reversible. A subletting that has ceased but whose earlier existence prevented the landlord from seeking a rent increase remains a valid ground despite the cessation (CA Paris, 10 April 2019). An irregular management lease (location-gérance) also qualifies, provided the Art. L. 145-17-1 formalities are respected (Cass. 3e civ., 10 January 1996).
Unauthorised Works or Failure to Maintain
Works carried out without required authorisation can qualify (Cass. 3e civ., 1 July 2003), but not all irregular works reach the threshold: works rendered necessary by an activity the landlord had accepted did not qualify (Cass. 3e civ., 28 September 2004). Failure to insure the premises is a recognised ground (CA Paris, 21 March 2003).
Cessation of the Fonds de Commerce
The landlord can refuse renewal where the tenant has ceased operating the fonds de commerce without a serious and legitimate reason. Assessment is fact-specific: a brief cessation is generally not treated as fault; an administrative closure order has been upheld even without a lengthy duration criterion (Cass. 3e civ., 20 November 1995). Cessation for health or maternity reasons is not a ground. Failure to operate the specific activity authorised in the lease (not just the business generally) has been upheld (Cass. 3e civ., 14 June 2006, n° 05-12.708). Cessation during a sauvegarde or redressement judiciaire observation period cannot be invoked by the landlord under Art. L. 622-14 C. com.
Non-Contractual Conduct
The landlord may also rely on conduct outside the contractual framework where it affects the landlord-tenant relationship or the execution of the lease. Recognised grounds from the case law include: prostitution and procuring in the leased premises (CA Paris, 16 December 1998); drug trafficking (CA Paris, 12 October 1995); interception of another occupant’s correspondence (CA Paris, 26 April 2006); physical or verbal violence (Cass. 3e civ., 28 March 1995); use of false documents in proceedings relating to the lease (Cass. 3e civ., 19 December 2001); and persistent non-compliance with co-ownership rules accompanied by aggressive conduct toward the landlord (CA Rouen, 14 September 2023).
Imputability: Whose Fault Is It?
The ground must be imputable to the current leaseholder at the time of the notice (locataire sortant). After an assignment, the assignee cannot be held responsible for the former tenant’s conduct unless: the lease includes a mutual guarantee clause making each assignee responsible for their predecessor’s obligations; or the assignee has itself continued the breach after the assignment. The Court of Cassation confirmed in December 2023 that even where the landlord served a refusal notice on the former tenant before the assignment, that notice cannot be invoked against the assignee for breaches that were the former tenant’s responsibility (Cass. 3e civ., 14 December 2023, n° 22-13.661). The landlord can, however, hold the outgoing tenant responsible for conduct by persons holding rights under the tenant, such as a sub-tenant or a management lessee (Cass. 3e civ., 13 June 1969; Cass. 3e civ., 29 May 1991).
The default rule that prior tenants’ breaches cannot be imputed to the assignee means a new tenant can take on a lease with a history of breaches and benefit from a clean slate. Landlords who allow assignments should always include in the assignment document a mutual guarantee clause making the assignee jointly responsible for any pre-existing but continuing breaches. Without it, the only recourse is to demonstrate actual continuation of the breach after the assignment.
Waiver: How Landlords Lose a Valid Ground
Waiver does not have to be express but must result from unequivocal acts. The clearest example: a landlord who offers renewal after having knowledge of the breach cannot subsequently rely on that breach as a ground for refusing renewal (Cass. 3e civ., 7 July 2004; Cass. 3e civ., 8 March 2005; CA Paris, 13 February 2019). The principle of immutability of grounds means all grounds known at the time of the notice must be stated: grounds known at that date but not stated cannot be added later. New grounds arising or discovered after the notice can be added, subject to serving a new prior formal notice for reversible breaches.
Conversely, a landlord who serves a renewal notice without knowing of the tenant’s irregular works does not thereby waive the right to rely on those works if discovered later (Cass. 3e civ., 3 December 2020). A contractual clause agreed with the tenant specifying that a single instance of non-payment within the one-month notice period constitutes a serious ground limits the court’s discretion, though it cannot override the forfeiture clause suspension powers under Art. L. 145-41.
Whether you are a landlord evaluating whether a tenant’s conduct reaches the serious and legitimate threshold, or a tenant challenging a refusal notice on those grounds, we advise on the substantive assessment, the procedural record, and the litigation strategy.
Book a ConsultationLegal Notice. This article is for general information and educational purposes only. It does not constitute legal advice. Laws and regulations may have changed since publication. Always seek qualified French legal advice on refusal of renewal grounds in a French commercial lease.
Key Legal References
Serious and legitimate reasons for refusal of renewal without eviction indemnity: sovereign judicial assessment; breach must be genuinely serious, imputable to the current tenant, and not waived by the landlord
Change of use without following the déspécialisation procedure constitutes a serious and legitimate ground
Rent arrears must be inexcusable and repeated to constitute a serious and legitimate ground
Pattern of late payments regularly brought current within one month is insufficient as a ground however often the pattern recurs
Landlord in serious breach of their own maintenance obligations cannot invoke rent arrears as a ground for refusal without indemnity
Subletting without the landlord being called to participate in the act is an irreversible breach justifying refusal without indemnity
A subletting that has ceased can still constitute a ground if its earlier existence prevented the landlord from seeking a rent increase
Administrative closure order constitutes a serious and legitimate ground based on cessation of activity; duration alone is not the determining criterion
Failure to operate the specific activity authorised in the lease (not just the business generally) constitutes a serious and legitimate ground
Assignee cannot be held responsible for the former tenant’s breaches absent a mutual guarantee clause; refusal notice served on former tenant cannot be invoked against assignee for predecessor’s breaches
Sub-tenant or management lessee conduct is imputable to the outgoing tenant for the purposes of serious and legitimate grounds
Landlord who offers renewal after having knowledge of the breach cannot subsequently rely on that breach as a ground for refusal; waiver by unequivocal conduct
Landlord who serves a renewal notice without knowing of the tenant’s irregular works does not waive the right to rely on those works if discovered later
