1. Effect of handing over the keys with respect to the co-tenant
2. Address for service of a summons on a legal entity
3. ALUR Law: Application over time of the new payment deadline granted to the tenant
4. Authorization to cut branches overhanging a neighboring property
5. Procedures for establishing a homeowners' association (ASL)
6. Consequence of the cancellation of a payment order constituting a real estate seizure
7. Majority applicable to decisions relating to the closure of the condominium
8. No subsidiary right of pre-emption for the tenant in the bulk sale of a building
9. Application of Article L.290-1 of the French Construction and Housing Code (CCH) to any promise of sale of a building
10. Conditions for the right of neighboring residents to compensation in the event of traffic modifications
1. Effect of Handing Over Keys with Respect to the Co-Tenant (
3rd Civil Chamber, February 18, 2015, No. 14-10.510) FS-PB:
The liquidator of a company, a co-tenant under a lease, notified the landlord of the termination of the contract. The landlord then sued the guarantors, including a co-tenant, for payment of rent, judicial termination of the contract, and eviction of the tenants.
The Court of Appeal held that the lease was terminated with respect to the co-tenant, on the grounds that, by letter dated March 26, 2009, the auctioneer, acting on the instructions of the liquidator, handed over the keys to the premises to the landlord, who accepted them without reservation, and that the return of the keys terminated the lease with respect to all tenants.
The Court of Cassation overturned the judgment. Indeed, according to the Court, unless otherwise stipulated by agreement, the handing over of keys to the landlord by the auctioneer, acting on the instructions of the liquidator, which only demonstrates the latter's intention to terminate the lease, cannot suffice to end the contract with respect to the other co-tenants.
2. Address for service of a summons on a legal entity
2nd 19 , 2015 (No. 13-28.140) F-PB:
In this case, a landlord company served the tenant with a formal demand for payment invoking the termination clause. The tenant then summoned the landlord before the summary proceedings judge, who ordered the suspension of the termination clause. The landlord then appealed, arguing that the initiating document was invalid.
To declare a summons, all subsequent actions, and an interim order null and void, the Court of Appeal held that, since the summons could not be served at the company's registered office address, the bailiff should have served it at the residence of the company's representative.
The Court of Cassation held that the address to which the bailiff had effected service was that of the company's registered office. Consequently, the Court quashed the judgment on the grounds that the Court of Appeal had violated Article 690 of the Code of Civil Procedure.
3. Alur Law: Application over time of the new payment period granted to the tenant
Opinion of the Court of Cassation February 16, 2015 (no. 15.002):
Article 24 of the law of July 6, 1989, amended by the Alur law, sets at three years the maximum payment period that can be granted to the tenant in a position to pay his rental debt and during which the effects of the termination clause are suspended.
The question was put to the Court of Cassation as to whether this text was applicable to leases in effect when the ALUR law came into force, given that this law includes Article 14, which defines a list of immediately applicable texts, among which Article 24 is not included.
According to the explanatory note accompanying the opinion, the Court of Cassation considered that the judge's power to grant a payment extension was a legal effect of the lease, not a mechanism subject to the contractual freedom of the parties, but a power granted to the judge by law. The Court of Cassation thus held that the amended Article 24 of the law of July 6, 1989, applied to leases in effect on the date the ALUR law came into force.
4. Authorization to cut branches overhanging a neighboring property.
3rd Civil Chamber. March 3, 2015 (No. 14-40.051) FS-PB:
The question was put to the Court of Cassation as to whether Article 673 of the Civil Code, insofar as it authorizes a neighbor to compel the owner to cut the branches of trees overhanging the neighboring property without the possibility for the tree owner to raise any defense, infringes upon the rights and freedoms guaranteed, on the one hand, by the preamble, Articles 1 to 4 and 6 of the Charter of the Environment and, on the other hand, by Articles 2 and 17 of the Declaration of the Rights of Man and of the Citizen of 1789?
The question being deemed not to be of a serious nature, the Court of Cassation refused to refer the matter to the Constitutional Council.
5. Procedures for establishing a Homeowners' Association (ASL)
3rd Civil Chamber. February 18, 2015 (No. 13-25.122) FS-PB:
In this case, a co-owner sued for payment of unpaid fees raised the issue of the invalidity of the founding general meeting of the homeowners' association (ASL) and the invalidity of the addendum to the specifications governing the extension of the housing development, on the grounds that unanimous consent of the owners was not obtained at the founding meeting.
The Court of Appeal and the Court of Cassation rejected the co-owner's arguments. In support of its decision, the Court of Cassation specified that the consent of all the co-owners stems from their commitment in the deed of acquisition to respect the clauses of the specifications, which provide for the establishment of an ASL. According to the Court, it follows that the unanimous agreement of the co-owners is not required for the establishment of subsequent bylaws.
6. Consequence of the annulment of the order to pay constituting a seizure of real property
2nd 19 , 2015, No. 14-10.622) FS-PB):
A bank issued an order to pay constituting a seizure of real property on April 14, 2008, and subsequently issued a summons. While the auction of the seized real property had taken place, an enforcement judge declared the order and all subsequent procedural acts null and void.
The bank issued a new order constituting a seizure of real property on April 26, 2012, which the debtors challenged before an enforcement judge, arguing that the bank's action was time-barred.
To dismiss the objection of inadmissibility based on the statute of limitations regarding the bank's action against them, which sought to continue the public auction of their real estate assets and rights, the Court of Appeal held that the limitation period had been interrupted by the debtors' acknowledgment of the bank's right against them in their submissions of November 3, 2009, and April 6, 2011, and again by their submissions of September 10, 2012.
The Court of Cassation overturned the judgment, finding that, since the submissions of November 3, 2009, and April 6, 2011, had been annulled, the acknowledgment they contained could not have interrupted the two-year limitation period stipulated in Article L. 137-2 of the French Consumer Code. Since the conclusions of September 10, 2012, were issued after the expiry of this deadline, the Court of Appeal violated Articles 2240 and 2241 of the Civil Code and Article L. 137-2 of the Consumer Code.
7. Majority applicable to decisions concerning the closure of the condominium
3rd Civil Chamber, February 18, 2015 (No. 13-25.974) FS-PBI:
A co-owner practicing medicine sued the condominium association to annul the general meeting's decision concerning the closure of the condominium by an automatic barrier and the permanent opening of pedestrian access to the condominium.
The question before the Court of Cassation was as to which majority rule applies to such a decision.
The Court of Cassation first notes that, according to Article 26(e) of the Law of 10 July 1965, now Article 26(c), decisions concerning the opening and closing procedures for buildings are adopted by a majority of the members of the condominium association representing at least two-thirds of the votes.
The Court then observes that the co-owners had decided to close the condominium with an automatic barrier, controlled by a remote control for residents and by a keypad for visitors, and that, according to the agenda of the general meeting, the co-owners had deliberated on the operating procedures of the barrier, particularly the closing times, and decided that it would remain permanently closed. Consequently, this decision had to be passed by the qualified majority stipulated in Article 26 of the Law of 10 July 1965.
8. No subsidiary right of pre-emption for the tenant in the sale of a building as a whole
( 3rd Civil Chamber). March 11, 2015 (No. 14-10.447) FS-PB:
In this case, the tenant of a dwelling, who had not complied with the notice to vacate for sale issued by his landlord, requested the annulment of the subsequent sale of the entire building. In support of his request, the tenant invoked the violation of his subsidiary right of first refusal.
The Court of Appeal, upheld by the Court of Cassation, rejected this request on the grounds that the sale of the entire building did not give the tenant the right to exercise a right of first refusal.
9. Application of Article L.290-1 of the French Construction and Housing Code (CCH) to any promise to sell a building
3rd 18 , 2015 (No. 14-14.416) FS-PBR:
A promise to sell with a validity period exceeding 18 months was concluded by private agreement. Following a disagreement between the parties, the beneficiary of the promise to sell sued the seller to have the sale declared valid.
The Court of Appeal having declared the promise to sell null and void, the beneficiary appealed to the Court of Cassation.
The Court of Cassation dismissed the appeal and reiterated that Article L. 290-1 of the French Construction and Housing Code (CCH) applies to any promise to sell concerning the transfer of a building or a real property right by an individual. In this case, the promise to sell, with a validity period exceeding 18 months, was therefore automatically subject to this provision and consequently had to be executed by notarial deed.
10. Conditions for Entitlement to Compensation for Residents in the Event of Traffic Modifications (
French Council of State, February 11, 2015, No. 367342):
In this case, the owner of a commercial property, which he leased to a car repair company, sought to hold the municipality liable for damages resulting from roadworks that had made access to his premises more difficult for vehicles exceeding a certain size.
The Court of Appeal dismissed the claim for compensation on the grounds that the modifications in question did not have the effect of preventing the claimant from accessing the public road.
The Council of State first reiterates that, in principle, modifications to general traffic resulting either from changes to the layout, direction, or design of public roads, or from the creation of new roads, do not give rise to a right to compensation. However, if these modifications result in prohibiting or making excessively difficult access to the public road for residents, they give rise to a right to compensation. Consequently, the court erred in law by dismissing the claim without examining whether the modifications had indeed made such access excessively difficult and whether, in the specific circumstances, this resulted in serious and particular harm to the individual concerned.
