Article L. 145-12 (1) of the French Commercial Code stipulates that the term of the renewed lease is nine years unless the parties agree to a longer term.
This provision is public policy pursuant to a qualification by case law. The judgment of the Paris Court of Appeal on 30th September 2016 provides an interesting illustration of this rule (CA Paris, 30th September 2016, no.14/14983).
In the said case, which concerned a 12-year commercial lease, the lessor gave notice with a renewal offer in accordance with the terms and conditions of the expired lease, which expressly stated a further 12-year term. Following receipt of the notice, the lessee replied by post without expressly referring to the term of the new lease: “We accept your lease renewal offer but refuse the rent increase”.
The lessor then summoned the lessee before the Commercial Rents Tribunal to determine whether the parties ‘agreement had renewed the lease for a term of 12 years. On the contrary, the Commercial Lease Tribunal held that pursuant to the notice with an offer to renew, the lease had been renewed for a term of nine years in the absence of any express agreement by the parties for a longer period.
On appeal, the lessor argued that the parties had lawfully agreed, upon the renewal of the lease, that it would be for a term of 12 years following discussions with the lessee. According to the lessor, the notice expressly mentioned a term of 12 years and that all aspects of the offer to renew had been accepted except the increase in rent.
The Paris Court of Appeal held that the parties’ agreement to a term longer than the minimum one stipulated by statute in the public policy provisions of Article L.145-12 of the French Commercial Code could not be deduced from the lessee’s silence on that particular point. It follows from the decision that when renewing the lease, the parties’ agreement for a renewal term of more than nine years can only result from their express will.