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Admissibility of a defence of non-performance by a tenant in response to a claim issued by a landlord for breach of the terms of a lease agreement

France
13/07/2023
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A new ruling on the important statutory so-called obligation for landlords to “deliver premises” that are suitable for their contractual use (“obligation de délivrance”) was recently issued by Court of cassation, on 6 July 2023[1].

In this case, a landlord issued a claim for breach the terms of the lease agreement, notably due to unpaid rents, to seek the termination of the lease agreement.

The tenant then issued a counterclaim with a defence of non-performance because of the alleged failure for the landlord to “deliver premises” suitable for their use, due to water infiltrations in the leased premises. The Court of Appeal of Douai ruled in favour of the tenant and ordered the disputed rents to be escrowed.

However, the Court of cassation noted that the Court of Appeal failed to assess that the premises were unfit for their use. Indeed, the Court of Appeal of Douai merely stated that the landlord did not “deliver premises” fit for their use and that it was irrelevant that operation was not totally impossible. The Court of cassation overturned the ruling of the Court of Appel.

By doing so, the Court of cassation confirms what appears to be the dominant case law trend that a tenant can only rely on a defence of non-performance to avoid the payment of rents in the instances where the operation in the leased premises is made impossible.

[1] 6 July 2023, No. 22-15923

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