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The Caen Court of Appeal has confirmed the judicial termination of a Pierre & Vacances commercial lease despite the late settlement of outstanding rent.

A holiday residence facing unpaid rent resulting from the health crisis

In a judgment dated 15 May 2026, the Caen Court of Appeal upheld the judicial termination of a commercial lease entered into between a private investor and the company PV Exploitation France for the operation of a Pierre & Vacances holiday residence.

The case concerned a landlord who, in 2018, had purchased several units in the ‘Presqu’île de la Touques’ holiday residence and had let them under a commercial lease to the operator Pierre & Vacances for a period of ten years. Following the Covid-19 health crisis, the operator suspended rent payments between March and June 2020, then made partial payments and applied various deductions to the rent due in 2020 and 2021.

Faced with persistent arrears, the landlord issued a demand for payment in October 2021 relating to arrears of nearly €20,000. Despite some settlements, the debt was not fully cleared until February 2024. In the meantime, the landlord had taken legal action against PV Exploitation France to seek the judicial termination of the lease and the eviction of the tenant.

The Lisieux District Court granted this application in November 2024, declaring the lease terminated at the tenant’s fault, ordering their eviction and ordering them to pay compensation for occupation until the premises were returned.

The arguments put forward by PV Exploitation France

Before the Court of Appeal, PV Exploitation France argued that the late payments were due to the exceptional consequences of the pandemic and the administrative measures that had affected the tourism sector from spring 2020 onwards. The company also argued that it had initiated conciliation proceedings and opened negotiations with the landlords to restructure the contractual arrangements.

In its view, as the arrears had finally been paid in full on 16 February 2024, no breach serious enough to justify the judicial termination of the lease could yet be established. It therefore sought the setting aside of the judgment and the dismissal of all the landlord’s claims.

The landlord countered that the company had unilaterally ceased paying rent for several years, without demonstrating any persistent financial difficulties and without being able to validly invoke the discussions entered into with certain landlords. He considered that the belated settlement of the debt did not negate the seriousness of the contractual breach committed.

Confirmation of a serious breach justifying the termination of the lease

The Court of Appeal noted that the tenant’s primary obligation is to pay rent on the agreed due dates and that judicial termination may be ordered where a sufficiently serious breach is established.

It noted that, despite the order to pay issued in October 2021, PV Exploitation France did not settle its debt until February 2024, more than two years after the formal notice and well after the end of the main health restrictions. The company did not provide any specific accounting evidence to establish that it was still unable to settle the sums due. On the contrary, it had failed to produce its own balance sheets and profit and loss accounts.

The court also emphasised that the financial reports of the Pierre & Vacances Center Parcs group revealed a rapid recovery in business from 2022 onwards. Following a significant drop in turnover during the crisis, the group had returned to and subsequently exceeded its previous level of activity as early as the 2021–2022 and 2022–2023 financial years.

Finally, the judges point out that the initiation of conciliation proceedings or the conduct of negotiations with certain landlords never had the effect of suspending the payment of rent. These circumstances could not therefore justify the continuation of such significant arrears over such a long period.

Scope of the decision

In view of the size of the rent arrears, the length of the delay in settling them and the lack of any serious financial justification, the court fully upholds the judicial termination of the lease, the eviction of the operator, the compensation for occupation and the orders already made. It further orders PV Exploitation France to pay an additional €2,500 pursuant to Article 700 of the Code of Civil Procedure, as well as the costs of the appeal.

This decision once again illustrates the severity with which the courts treat operators of holiday accommodation who have allowed rent arrears to persist for a prolonged period following the health crisis, even where these were eventually settled during the proceedings.

Legal action brought against a landlord following work carried out unilaterally

In a judgment dated 13 May 2026, the Nanterre District Court dismissed all the claims brought by Appart’City against the owner of a unit located in a hotel-style residence operated under the Appart’City brand. This decision provides important insights into the allocation of obligations between the landlord and the operator regarding renovation works in tourist residences.

The dispute concerned a flat acquired by Actual Investissement in a residence operated by Appart’City. The initial commercial lease, entered into in 2008, provided for an annual rent of approximately €8,600 including VAT and placed the responsibility for all tenant-related repairs, as well as all repairs other than major repairs under Article 606 of the Civil Code, on the tenant.

In 2019, Appart’City considered that the property was in a state of disrepair requiring a complete refurbishment. It therefore sent a letter to the landlord estimating the cost of the works at €17,014 including VAT and stating that these would be carried out at its expense. The works were finally carried out in 2020. Having failed to obtain reimbursement of the costs, Appart’City sued the owner for payment.

Appart’City’s argument: the dilapidation is the landlord’s responsibility

To justify its claim, Appart’City argued that the property had been in operation for over ten years and that, in a holiday residence, such a period of operation was sufficient to constitute a state of dilapidation requiring refurbishment. According to the operator, the landlord remained liable for the works made necessary by this dilapidation, which could not be equated with mere tenant repairs.

The company also cited several inspections carried out at the residence, as well as expert reports setting out wear and tear scales applicable to tourist residences. It argued that the renovation of the communal areas decided upon by the co-ownership association also demonstrated the need for a general refurbishment of the establishment.

Finally, Appart’City considered that its letter of 30 August 2019 constituted sufficient formal notice to allow it, on the basis of Article 1222 of the Civil Code, to carry out the works itself and then claim reimbursement from the landlord.

The court ruled out the existence of dilapidation justifying a complete renovation

The court carried out a detailed comparison of two bailiff’s reports drawn up in 2017 and 2019 respectively. It noted that the first report found the flat to be generally in good condition, with the exception of a cracked tile and a carpet showing normal wear and tear. Two years later, only a few minor instances of damage were noted: a damaged bath screen, slightly worn furniture, a broken floor tile or a stained carpet.

In the court’s view, these findings in no way demonstrated the need for a complete renovation of the property. Yet the work carried out by Appart’City went far beyond repairing the observed defects, as it involved the floors, paintwork, electrical systems, plumbing, furniture, household appliances and numerous fixtures.

The judges also emphasised that Appart’City had not provided evidence of regular maintenance of the property, even though the lease required it to bear the cost of tenant repairs as provided for by the decree of 26 August 1987. The invoices submitted did not establish that the operator had in fact carried out this maintenance.

A formal notice deemed non-existent

The central point of the judgment, however, lies in the application of Article 1222 of the Civil Code. This provision allows a creditor, following a formal notice, to have an obligation performed by a third party at the debtor’s expense.

The court considered that the letter sent on 30 August 2019 did not constitute a genuine formal notice. Far from requiring the landlord to carry out the works on pain of legal action, this letter in fact offered him two options: to agree to cover the costs of the works or to enter into a new commercial lease providing for a reduction in rent and a new mechanism for financing the renovations.

The judges concluded that Appart’City had never clearly demanded that the landlord carry out the works nor set a reasonable deadline for compliance. In the absence of prior formal notice or judicial authorisation, the operator could not therefore act in the landlord’s stead and then claim reimbursement of the expenses incurred.

An important decision for managed holiday residences

The court consequently dismissed Appart’City’s claim for reimbursement of €17,014 and also rejected its other claims. This decision serves as a reminder that the operator of a tourist residence cannot rely solely on the age of a property to impose a complete renovation on the landlord. It also confirms that, where work is carried out in the landlord’s stead, strict compliance with the conditions of Article 1222 of the Civil Code remains essential, in particular the existence of a genuine prior formal notice.

Liability of the escrow notary in the sale of a business: negligence found but no damage proven

A business transfer followed by a dispute between the parties

In a judgment of 18 May 2026, the Béziers Judicial Court was called upon to rule on the liability of a notary who had acted as escrow agent for the sale price during a business transfer. The case is of particular interest in that it clearly distinguishes between the existence of fault on the part of the escrow agent and the demonstration of the damage required to obtain compensation.

The dispute arose from the sale, on 8 July 2021, of a driving school business for a price of €35,000. In accordance with the deed of sale, the drafting notary had been instructed to hold the proceeds in escrow and then to distribute them in accordance with legal and contractual provisions.

A few months after the sale, a dispute arose between the purchaser and the seller. The purchaser then sent a letter to the notary on 9 December 2021, informing him of a serious dispute regarding the sale of the business and asking him to retain the funds held in escrow. Despite this dispute, the notary subsequently released the balance of the purchase price to the seller.

Believing that this release had compromised their chances of recovering certain sums owed by the seller, the purchaser brought an action for liability against the notary’s office and claimed €50,000 in damages.

The allegations against the notary acting as escrow agent

The transferee argued that the notary had breached his obligations as escrow agent by releasing the funds despite having been expressly informed of a dispute concerning the transfer. In his view, the existence of this dispute precluded any release of the sums to the transferor without his prior consent.

In the alternative, he also alleged a breach of the duty to provide information and advice. In particular, he criticised the notary for failing to explain sufficiently to him the consequences of an arbitration clause included in the deed of sale, or the steps necessary to preserve his rights to the escrowed price.

To substantiate his claim for damages, the transferee asserted that he had had to bear more than €34,500 in debts and costs that should have been borne by the seller. In his view, the release of the purchase price had resulted in a loss of opportunity to recover these sums from the transferor.

The court finds fault in the management of the escrow

The court first sets out the principles applicable to contractual escrow. Under Articles 1956 and 1960 of the Civil Code, the custodian responsible for an escrow cannot be released from their duties until the dispute is resolved, unless all interested parties agree or there is a legitimate reason.

The deed of assignment did indeed authorise the notary to make certain payments to creditors who had duly lodged an objection. The court therefore considers that the payments made to a secured creditor were in accordance with the contractual provisions.

However, the judges noted that the assignee had sent a letter of objection to the notary on 9 December 2021. This objection was sufficient to establish the existence of a dispute regarding the assignment. Consequently, before any payment of the balance of the price to the vendor, the notary was required to verify that the dispute had been resolved or to obtain the assignee’s consent.

The court further found that the funds had been released to the vendor after this objection had been sent. It concluded that the notary’s office had breached its duty of care and its obligations as a custodian by proceeding with this premature release of funds.

The lack of evidence of loss leads to the dismissal of the claim

Despite this fault, the transferee’s claim fails on the key issue of loss. The court points out that civil liability requires not only a fault, but also proof of actual loss and a direct causal link between the fault and that loss.

However, the claimant produced no supporting documents to establish the payments he claimed to have made, amounting to €34,512.70. Nor did he demonstrate the reality of the loss of opportunity alleged, nor the impossibility of pursuing the assignor directly to obtain reimbursement.

The judges therefore consider that the alleged loss has not been proven. Consequently, despite the breach found against the notary, the claim for compensation is dismissed in its entirety.

Scope of the decision

This decision illustrates a classic yet fundamental rule of liability law: the demonstration of a fault, even a clear one, is not sufficient to obtain compensation. It is also necessary to establish precisely the reality of the loss suffered and its direct link to the alleged fault. The judgment also reiterates that the escrow notary must exercise particular vigilance whenever a dispute affects the transfer of the business, even after the expiry of the time limits for creditors to lodge objections.

A class action lawsuit pitting several landlords against Odalys Résidences

In a judgment dated 22 May 2026, the Toulouse Commercial Court ruled on a dispute involving several owners of units located in a holiday residence operated by the company Odalys Résidences. The landlords were claiming payment of rent that remained unpaid during the 2020 and 2021 financial years following the Covid-19 health crisis.

Between 2012 and 2014, the owners had entered into nine-year commercial leases for various apartments within a holiday residence. During the pandemic, Odalys ceased to pay the full rent stipulated in the contracts, arguing that it could invoke a specific clause in the lease allowing for a reduction in rent in the event of force majeure interrupting tourist activity.

Faced with this situation, the landlords took legal action against the operator to secure payment of rent arrears for the years 2020 and 2021, together with statutory interest.

A contractual clause governing the sharing of force majeure risk

The core of the dispute centred on the interpretation of Article 6 of the commercial leases. This clause provided that, in the event of force majeure interrupting tourist activity, the rent would be reduced to 30% of the net revenue actually received by the tenant and distributed among the landlords in accordance with their respective shares.

The clause specifically covered scenarios such as natural disasters, pollution, administrative barriers to free access to the premises, or restrictions on the movement of people. It specified, however, that this mechanism could not apply where the loss suffered by the tenant was covered by insurance.

The landlords argued that this provision could not justify the reductions made by Odalys. The operator, on the contrary, asserted that the pandemic and the administrative measures adopted by the public authorities fell squarely within the scope of this clause.

The court recognises the applicability of the Covid clause

The court began by validating the very principle of the clause. It noted that no legal provision prohibits the parties from contractually addressing the consequences of a force majeure event on the amount of rent.

The judges then considered that the Covid-19 pandemic and the government measures adopted to combat its spread did indeed constitute a case of force majeure within the meaning of the contract. The successive lockdowns, the administrative closures of holiday accommodation and the travel restrictions had effectively brought tourism to a halt, sometimes completely, sometimes partially.

The court also held that the clause could apply even in the event of only a partial interruption of business. According to the judges, the general structure of the contract revealed an intention on the part of the parties to share the financial consequences of exceptional events affecting the tourism business.

Finally, Odalys demonstrated that no insurance compensation had been received in respect of operating losses linked to the health crisis. The exclusion condition provided for in the lease was therefore not met.

Odalys’ failure to prove revenue received

Odalys’ victory on the principle of the clause does not, however, allow it to escape its liability.

The court emphasised that the contractual mechanism for rent reduction was based exclusively on the “net revenue actually received” by the operator during the periods in question. However, this concept is not to be confused with turnover. A company may invoice for services without having yet received the corresponding sums.

The judges note that Odalys produced evidence relating only to its turnover and not to the revenue actually received during the periods when tourist activity was suspended. This distinction is essential, as the contractual clause referred specifically to actual receipts.

Failing to demonstrate this fundamental condition, Odalys could not benefit from the rent reduction mechanism provided for in the lease. The court therefore considers that the rent must be calculated according to the normal contractual amount.

Order to pay outstanding rent

Having ruled out the practical application of the clause, the court examined the situation of each of the landlords. It found that the amounts claimed corresponded to the outstanding contractual rent and noted that Odalys had not provided any further evidence of the payments it claimed to have made.

The various landlords thus secured an order requiring Odalys to pay the full amount of rent arrears for the 2020 and 2021 financial years, with interest at the statutory rate from the date of the formal notices or, failing that, from the date of the summons.

Scope of the decision

This decision is of particular interest to tourist residences. The court acknowledges that a health risk-sharing clause may be valid and applicable to the Covid crisis. However, it firmly reiterates that an operator invoking such a mechanism must strictly comply with the conditions for its implementation and provide evidence thereof. In the absence of proof of the revenue actually received, the rent reduction becomes unenforceable against the landlords, who regain their right to full payment of the contractual rent.

A typical dispute arising from unpaid rent following the health crisis

By an interim judgment of 4 May 2026, the Bonneville Judicial Court was seized of a new dispute between the owners of a holiday residence and the Pierre & Vacances group. Whilst the court has not yet ruled on the merits of the case, the decision is of significant procedural interest regarding the transfer of commercial leases between companies within the group.

The claimants, owners of a flat and a cellar within a holiday residence operated under the Pierre & Vacances brand, had entered into a guaranteed commercial lease with the company PV Résidences & Resorts France. The lease, signed on 14 January 2021 with retroactive effect from 1 October 2020, provided for a guaranteed annual rent of €12,593 excluding tax.

Believing that the rent had not been paid in full since the health crisis, the landlords took legal action against PV Holding, which had succeeded to the rights of PV Résidences & Resorts France, in order to obtain payment of the outstanding sums.

Over €15,000 in rent claimed by the owners

The owner couple argued that the operator had suspended rent payments between October 2020 and June 2021 and then made irregular payments until October 2024. According to their calculations, after taking into account certain works for which they were liable, a balance of €15,355.92 remained unpaid.

They therefore sought a joint and several order against PV Holding and PV Exploitation France to pay this sum, plus statutory interest from the date of a formal notice sent in December 2023. In the alternative, they sought payment of at least €7,586.16 corresponding to rent remaining unpaid between August 2022 and October 2024.

The landlords relied on the now well-established case law of the Court of Cassation, according to which administrative closures linked to Covid-19 do not constitute either a loss of the leased property within the meaning of Article 1722 of the Civil Code or a breach by the landlord of their obligation to deliver the property. In their view, no suspension of rent was therefore legally justified.

They also contested certain compensation mechanisms applied by the operator in respect of service charges or works, arguing that these deductions were not duly justified.

Pierre & Vacances invokes the transfer of the lease to PV Exploitation France

In response to these claims, the companies of the Pierre & Vacances group developed a two-pronged defence. They first argued that PV Holding could no longer be held liable for payment, as the lease had been transferred to PV Exploitation France following a partial asset transfer agreement signed on 16 December 2020.

According to them, all leases relating to the operation of Pierre & Vacances residences had been transferred to this new company, which had become the sole holder of the rights and obligations arising from the disputed lease.

On the merits, they argued that the rent had been paid in full after offsetting certain charges and works borne by the lessors. They also claimed that the deduction of €7,769.76 corresponded to the periods of administrative closure of the residence during the health crisis, a period during which the obligation to pay rent had been suspended.

The defendant companies thus reiterated the arguments already put forward in numerous Covid-related disputes, based on the partial loss of the leased property, the impossibility of operating the premises and the defence of non-performance.

The court identified a preliminary difficulty: who is actually the tenant under the lease?

Even before examining the issue of unpaid rent, the court noted a fundamental difficulty: the identity of the actual tenant had not been sufficiently established.

The judges noted that the lease did indeed contain a clause authorising its assignment by the tenant under certain conditions. They also noted that the voluntary intervention of PV Exploitation France was admissible.

However, the defendant companies have not produced the partial asset transfer agreement on which they rely. Crucially, the disputed lease was signed in January 2021, i.e. after the date of the agreement in question. The court therefore observes that there is currently no evidence to show that this specific lease was in fact transferred to PV Exploitation France.

The judges also note that the landlords are seeking a joint and several judgment against PV Holding and PV Exploitation France without specifying the exact legal basis for such joint liability.

A reopening of the proceedings before any decision on the rent

Considering that these preliminary issues are decisive for the outcome of the dispute, the court refuses to rule immediately on the financial claims. It orders the proceedings to be reopened and invites PV Exploitation France to produce the partial asset transfer agreement as well as all evidence establishing the transfer of the disputed lease.

At the same time, the lessors are invited to specify the legal basis for their claim for joint and several liability and to explain on what grounds they are also seeking to hold PV Exploitation France liable.

All claims are therefore reserved and the case adjourned to a later hearing. This decision illustrates the importance, in disputes concerning holiday residences, of verifying precisely the transfer of commercial leases during internal restructuring of operating groups before addressing the issue of rent payments.

Covid-19 and holiday let rents: the Rennes Court of Appeal orders operator HMC to pay all outstanding rent.

A new ruling in favour of tourist accommodation landlords

In a judgment of 13 May 2026, the Rennes Court of Appeal overturned an interim order issued by the Quimper Judicial Court and ordered HMC, the operator of a holiday residence, to pay the landlords an advance payment corresponding to the full amount of rent unpaid during 2020 and 2021. This decision follows on from the now well-established case law concerning the consequences of the health crisis on commercial leases for holiday residences.

The case concerned several investors who owned properties in a holiday residence operated by HMC. Following the Covid-19 pandemic and government measures restricting travel, the operator had announced as early as July 2020 that it would pay only 50% of the rent due for the first half of 2020. The landlords then suffered rent deductions for several years which they considered unjustified.

After several unsuccessful attempts at amicable resolution, the owners served formal notice on HMC to pay the full amount of rent and charges still due before bringing the matter before the court for interim relief.

The interim judge’s refusal to order the operator to pay

At first instance, the judge in summary proceedings had refused to grant a provisional order for the unpaid rent. He had considered that the objections raised by HMC precluded the granting of a provisional order. However, he had awarded the landlords reimbursement of certain household waste collection charges for the years 2020 and 2021.

The landlords appealed against this decision, arguing that the arguments put forward by HMC were now contrary to established case law of the Court of Cassation and the courts of appeal. In their view, the rent remained due in full despite the health crisis, and no serious objection could justify the rejection of their claims.

They therefore claimed payment of rent arrears for each of their units, as well as damages for wrongful refusal to pay.

The operator’s arguments based on the health crisis

In an attempt to avoid paying rent, HMC argued that the government measures adopted during the pandemic had rendered the lease void. According to the operator, the temporary ban on hosting tourist guests had made it impossible to operate the residence normally, meaning that its obligation to pay rent should be suspended.

The company argued that travel restrictions and limitations on public access had had the same effect as an administrative closure. It also contended that the amounts claimed by the landlords remained open to question and that there was still serious dispute regarding the exact calculation of the sums due.

HMC therefore sought full confirmation of the order refusing any advance payment of rent.

The Court of Appeal rejects the theory of the cause of action having lapsed

The Rennes Court firmly dismissed the main argument put forward by the operator. It noted that the basis for the obligation to pay rent lies in the landlord making the premises available. However, the premises remained available to the tenant throughout the entire period in question.

The judges emphasised that the operator retained control of the premises at all times, including during periods when certain restrictions affected public access. The disruption cited by HMC did not result from a breach by the landlords but exclusively from the general measures decided by the public authorities to combat the epidemic.

The court also reiterated a fundamental principle regarding commercial leases: the landlord is not obliged to guarantee the marketability of the leased premises unless specifically stipulated in the contract. The economic difficulties faced by the operator due to the decline in tourist numbers cannot therefore be attributed to the landlords.

A provisional order to pay rent

Having dismissed HMC’s objections, the court noted that the landlords had produced the commercial leases, rent invoices and detailed summary tables enabling the sums due to be determined precisely. Conversely, the operator provided no accounting records or supporting documents capable of seriously calling these calculations into question.

The court therefore ruled that the obligation to pay was not seriously contestable within the meaning of Article 835 of the Code of Civil Procedure and ordered HMC to pay, on a provisional basis:

• €6,229.69 to a first landlord;
• €8,618.15 to a second;
• €7,553.25 to a couple of landlords;
• €6,229.60 to a fourth investor.

Statutory interest and its capitalisation are also awarded.

An important decision for investors

The court, however, upheld the dismissal of claims for damages for unreasonable resistance, finding that the landlords had failed to demonstrate either specific bad faith on the part of the operator or any loss distinct from the unpaid rent.

This ruling nevertheless constitutes another significant victory for owners of holiday residences. It confirms that operators can no longer successfully invoke the health crisis to justify unilateral rent withholdings several years after the events. Above all, the decision serves as a reminder that operational difficulties linked to Covid-19 do not call into question the tenant’s fundamental obligation to pay rent when the premises have remained at their disposal.

Appart’City’s claim for reimbursement of renovation costs at a holiday residence has been dismissed.

Background to the dispute

In a judgment dated 13 May 2026, the Nanterre District Court dismissed the claim brought by Appart’City, which sought reimbursement of €20,452 for renovation work carried out in a flat operated within a tourist residence. The proceedings pitted the operator against a property owner who had let her property under a commercial lease in 2010.

The lease, entered into for a term of eleven and a half years, covered a flat within a hotel-style residence operated by Appart’City. After nearly ten years of operation, the operator considered that the property was in a state of disrepair incompatible with the standards expected of the residence and undertook an extensive renovation programme.

In September 2019, Appart’City sent the owner a letter stating that renovation work was necessary and estimated to cost €20,452 including VAT. The work was eventually carried out and invoiced to the lessor, who refused to pay. The operator then brought legal proceedings to obtain reimbursement of this sum.

The arguments put forward by Appart’City

The operator argued that the dilapidated state of the property was the result of the intensive use typical of tourist residences. In its view, after nine years of continuous occupation, the property was no longer fit for its commercial purpose and required a complete refurbishment.

Appart’City invoked the landlord’s legal obligations to deliver and maintain the premises in a condition fit for the agreed use. The operator considered that it had regularly alerted the owner to the condition of the property in a letter dated 3 September 2019, which it regarded as a formal notice.

The company also argued that Article 1222 of the Civil Code allowed it, following a formal notice that had remained without effect, to carry out the necessary works itself and then claim reimbursement from the owner. Finally, it contended that the need to renovate the residence had been collectively acknowledged by the co-owners at a general meeting.

The landlord’s objection

The owner contested both the necessity and the extent of the work carried out. She emphasised that the lease placed the responsibility for routine maintenance, tenant repairs and all repairs other than major repairs under Article 606 of the Civil Code on the tenant.

She pointed out that the defects noted in the bailiff’s report of 2019 were essentially limited to stained carpets, a few scratches, lack of cleanliness and various minor damages. In her view, these findings could not justify a complete renovation of the property.

The defendant also argued that the works had been imposed without her consent, whereas the lease expressly provided that works affecting the private areas must be decided jointly by the landlord and the tenant.

The court’s analysis

The court first noted that the commercial lease remains applicable and that there is no serious evidence to call this contractual classification into question. However, this issue was deemed to have no bearing on the main dispute.

The judges then examined the bailiff’s findings from 2019. They observed that the defects noted mainly concerned minor damage: stained carpets, marked furniture, worn seals, faded paintwork or minor maintenance issues.

Yet the work actually carried out went far beyond simple repairs. Appart’City undertook a virtually complete refurbishment of the property, including in particular the replacement of floors, paintwork, sanitary fittings, the kitchen, furniture, electrical appliances, lighting, ventilation and numerous new fixtures.

The court found that the evidence submitted did not demonstrate that such a comprehensive renovation was necessitated solely by the dilapidated state of the property. It also emphasised that Appart’City had not sufficiently demonstrated that it had fulfilled the routine maintenance obligations imposed on it by the lease.

The absence of a formal notice

One of the key points of the judgment concerns the application of Article 1222 of the Civil Code.

The court notes that a creditor may only carry out the works themselves and claim reimbursement for them after issuing a proper formal notice to the debtor. This formal notice must be explicit, specify the alleged breaches of obligation and set a deadline for remedying them.

However, the letter of 3 September 2019 did not have this effect. The judges noted that it essentially offered the landlord two options: to finance the works or to enter into a new commercial lease providing for a specific renovation mechanism and a reduction in rent. The document did not clearly express the intention to seek legal enforcement of the works in the event of refusal.

Consequently, no valid formal notice had been served on the landlord prior to the works being carried out. Appart’City could not therefore unilaterally act in the landlord’s stead.

The ruling

The court dismissed Appart’City’s claim for reimbursement of the €20,452 in renovation costs in its entirety. It ruled that the operator had failed to demonstrate either the necessity of a full renovation of the property or compliance with the legal conditions allowing it to act in the landlord’s stead.

This decision is of particular interest to landlords of tourist accommodation. It serves as a reminder that an operator cannot unilaterally impose major renovation programmes on landlords without demonstrating precisely their necessity and without strictly adhering to the procedures set out in the lease and in Article 1222 of the Civil Code.

Leaseback accommodation: the Court of Cassation confirms that the three-year non-termination clause does not apply to renewed leases

A landmark ruling for holiday accommodation

In a judgment published in the Bulletin on 7 September 2023, the Third Civil Chamber of the Court of Cassation provided a key clarification regarding the rules governing commercial leases for holiday accommodation. The High Court ruled that the three-year prohibition on termination provided for in Article L. 145-7-1 of the Commercial Code does not apply to renewed leases.

This decision is of direct interest to owners of holiday residences as well as operators such as Pierre & Vacances, Adagio, Belambra and Appart’City, whose contractual relationships are frequently based on long-term commercial leases.

The facts: a notice of termination issued by Pierre & Vacances

The case concerned a couple of landlords who had let a property located in a holiday residence to the company Pierre & Vacances Maeva Tourisme Exploitation, whose rights were subsequently acquired by PV Résidences & Resorts France, which later became PV Holding.

The lease in question was not an initial lease but a renewed lease signed on 21 September 2010 for a term of eleven years.

On 24 March 2015, the operator served a notice of termination taking effect at the end of the second three-year period. The landlords contested this notice, arguing that Article L. 145-7-1 of the Commercial Code prohibited any three-year termination in holiday residences. They then sought the annulment of the notice of termination and payment of rent until the contractual end of the lease.

After their appeal was dismissed by the Paris Court of Appeal, the owners lodged an appeal to the Court of Cassation.

The legal question put to the Court of Cassation

The dispute concerned the interpretation of Article L. 145-7-1 of the Commercial Code.

This provision, introduced by the Act of 22 July 2009, stipulates that commercial leases entered into between landlords and operators of classified tourist residences must have a minimum term of nine years “without the possibility of termination at the end of a three-year period”.

The landlords argued that this prohibition applied to both initial leases and renewed leases. In their view, the provision made no distinction between these two categories of contracts and should therefore be applied generally.

Conversely, PV Holding argued that this derogatory rule applied only to initial leases and that renewed leases remained subject to the general law regime provided for in Article L. 145-12 of the Commercial Code.

The reasoning of the Court of Cassation

The Court begins by noting that Article L. 145-7-1 constitutes a derogation from the principle laid down by Article L. 145-4 of the Commercial Code, which normally grants the tenant the right to terminate the lease at the end of each three-year period.

It then notes that the legislature introduced this exception in order to guarantee the economic stability of tourist accommodation during the initial period of operation. Parliamentary proceedings demonstrate that the objective was to ensure the continuity of tourist operations for an initial minimum period of nine years.

The Court then examines the specific regime governing renewed leases. It points out that Article L. 145-12 of the Commercial Code provides that, unless otherwise agreed, a renewed lease is concluded for nine years and remains subject to the provisions of Article L. 145-4 relating to three-yearly termination.

Consequently, in the absence of any express provision extending the prohibition on termination to renewed leases, the Court considers that the mechanism of Article L. 145-7-1 ceases to apply after the first renewal.

Validation of the notice of termination served by the operator

Applying this reasoning to the present case, the Court finds that the disputed contract did indeed constitute a renewed lease.

It therefore upholds the Court of Appeal’s finding that the operator regained the right to terminate the lease at the end of a three-year period in accordance with the general law on commercial leases. The notice of termination issued by Pierre & Vacances was therefore deemed perfectly valid.

The landlords’ claims for payment of rent until the contractual end of the lease are consequently dismissed.

The issue of compensation for continued occupation

The owners also argued that the operator remained liable for sums due after the effective date of the notice of termination.

The Court of Cassation points out, however, that after the end of the lease, the occupant is no longer liable for rent but, where applicable, for compensation for continued occupation. Yet the landlords had only claimed payment of rent and had not made a separate claim for compensation for continued occupation.

The Court of Appeal was therefore not required to substitute one claim for another of its own motion. The Court of Cassation also upheld this reasoning.

Practical implications of the judgment

This judgment now constitutes a landmark decision regarding tourist residences. The Court of Cassation clearly states that the protection provided by Article L. 145-7-1 of the Commercial Code applies solely to the initial term of the lease and does not survive renewal.

For landlords, the consequence is significant: unless otherwise provided for in the contract, an operator holding a renewed lease regains the right to terminate the lease every three years, as provided for in Article L. 145-4 of the Commercial Code. This solution opens up more possibilities for operators wishing to reorganise their rental portfolio and reduces the contractual stability previously enjoyed by landlords following the renewal of the lease.

CGH holiday residence ‘Les Cimes Blanches’: eviction compensation set at €42,373 following refusal to renew the lease.

A new eviction dispute at a CGH holiday residence

In a judgment of 22 May 2026, the Albertville District Court set the eviction compensation payable by the owners to Compagnie de Gestion Hôtelière (CGH) following a refusal to renew a commercial lease for a flat located in the ‘Les Cimes Blanches’ holiday residence in La Rosière. This decision is of particular interest in that it details the methods for assessing the loss suffered by a tourist residence operator in the event of a partial loss of its business assets.

The dispute concerned an apartment, a cellar and a parking space let under a commercial lease to CGH from 28 June 2007 for a term of eleven years. In 2015, the properties were acquired by new owners who, on 22 December 2017, served notice of termination with a refusal to renew but with an offer to pay compensation for eviction.

As no agreement could be reached on the amount of this compensation, CGH brought the matter before the court to have the loss assessed by the court. A judicial expert’s report was ordered before the court made a final ruling on the assessment of the compensation.

The principle of the right to eviction compensation was no longer in dispute

The question of the very right to compensation had already been settled by a previous judgment handed down on 5 March 2023.

The court had then rejected the landlords’ arguments that CGH should be denied any compensation due to alleged breaches of its contractual obligations. As this issue had been definitively settled, the debate centred solely on the amount of compensation due to the operator.

CGH claimed compensation of €48,162, arguing that the refusal to renew the lease had resulted in a significant financial loss. The landlords, on the other hand, considered that the compensation should not exceed €32,900.

A partial loss of the business, not a total loss

The court began by reiterating the principles of Article L.145-14 of the Commercial Code. Eviction compensation is intended to remedy the loss resulting from the failure to renew the lease and primarily comprises the market value of the business lost by the evicted tenant.

The judges noted that CGH operated a four-star tourist residence comprising 152 apartments. The refusal to renew the lease concerned only one apartment, a cellar and a parking space. The company therefore continued to operate the rest of the residence.

The loss therefore did not correspond to the total loss of the business but to a partial loss thereof. The compensation should therefore be calculated as replacement compensation corresponding to the fraction of the business lost by the operator.

Rejection of several valuation methods proposed by the expert

The court-appointed expert had examined several valuation methods.

The court first rejected the method inspired by a judgment of the Paris Court of Appeal, which involved applying a coefficient to the residence’s gross margin and then applying a rent ratio to the result. The judges considered that this method mixed data relating to the entire residence with data specific to the disputed unit and did not allow for a correct assessment of CGH’s actual loss.

They also rejected the method based on amicable settlements observed in other cases, due to a lack of objective evidence to verify its relevance.

The so-called ‘rent multiples’ method was also rejected. According to the court, this approach is based on the landlord’s income, whereas the eviction compensation is intended to compensate the tenant for their loss. According to the judges, no direct economic link justifies calculating the value of the lost business based on the amount of rent paid to the landlord.

The methods selected: turnover and gross operating surplus

The court ultimately favoured the two methods traditionally used in the valuation of business assets: the turnover method and the gross operating surplus (GOS) method.

With regard to turnover, the expert had used an average of €18,706 excluding VAT, calculated over the financial years 2018, 2019, 2022 and 2023, with the years 2020 and 2021 excluded due to the exceptional disruptions caused by Covid-19. After applying a coefficient of 1.5, the resulting value amounted to €28,059.

Regarding EBITDA, the loss of earnings suffered by CGH had been assessed at €12,597. By applying a multiple of 4.5, the court arrived at a value of €56,687.

Eviction compensation set at €42,373

To arrive at a balanced assessment, the court decided to use the arithmetic mean of the results derived from the two methods deemed relevant.

This average led to the eviction compensation being set at €42,373, a sum to be borne by the owners.

The court, however, refused to award any additional compensation, as CGH had failed to demonstrate any specific relocation costs, any separate commercial disruption, or any other additional loss. Each party bore its own costs and no compensation was awarded under Article 700 of the Code of Civil Procedure.

Scope of the decision

This decision is of particular interest in disputes concerning holiday residences. The Albertville court confirms that the loss of a single flat within an operating residence constitutes a partial loss of the business, giving rise to a right to compensation. Above all, it favours an economic approach based on the turnover and EBITDA specific to the unit in question, whilst rejecting methods based on rent paid to owners or on insufficiently documented transactional practices. This reasoning thus provides a particularly useful framework for analysing future eviction compensation disputes involving operators of tourist residences.

Adagio Residence: Nanterre District Court upholds the decision not to renew the lease without compensation for eviction due to unpaid rent.

Another ruling against Adagio in post-Covid litigation

In a judgment dated 26 May 2026, the Nanterre Commercial Court dismissed the claim for compensation for eviction brought by Adagio following the refusal to renew several commercial leases for apartments located in a holiday residence operated by the company. This ruling illustrates the courts’ increasingly strict stance towards operators who suspended or delayed rent payments during the health crisis.

The dispute concerned several units located in a residence operated by Adagio and previously let to Icade Résidences Services, whose rights are now held by Adagio. The commercial leases had been entered into in 2009 for a term of nine years.

Following significant payment delays from 2020 onwards, several landlords served notices of termination with refusal of renewal without offering compensation for eviction, considering that the tenant’s breaches constituted serious and legitimate grounds within the meaning of Article L.145-17 of the Commercial Code.

Terminations motivated by unpaid rent arising during the health crisis

The landlords accused Adagio of having ceased to pay rent regularly from the first quarter of 2020 onwards.

According to them, the delays had persisted over several financial years despite reminders and formal notices sent to the operator. They argued that these arrears had continued even though no legal provision had suspended the obligation to pay commercial rent during the pandemic.

A formal notice by extrajudicial document was served on 7 July 2021. This notice reproduced the provisions of Article L.145-17 of the Commercial Code and invited Adagio to rectify its situation within the statutory period of one month. As the rent had not been paid in full within this period, the landlords subsequently served notices of termination with refusal of renewal, without compensation for eviction, taking effect on 31 March 2022.

Adagio cited the health crisis and the lack of seriousness of the breaches

In challenging the notices of termination, Adagio argued primarily that the landlords had not demonstrated any serious and legitimate grounds justifying the denial of eviction compensation.

The operator argued that the payment difficulties stemmed from the exceptional consequences of the Covid-19 pandemic, as administrative closures and travel restrictions had severely affected the operations of holiday residences.

The company also cited the initiation of conciliation proceedings aimed at reorganising its relations with the landlords and seeking negotiated solutions. In its view, this approach demonstrated its good faith and ruled out any wrongful conduct.

Adagio finally emphasised that the arrears had subsequently been settled. It considered that the payment delays were therefore not sufficiently serious to justify a refusal to renew the lease without compensation.

Consequently, it sought recognition of its right to eviction compensation and to remain in the premises until such compensation was paid, on the basis of Article L.145-28 of the Commercial Code.

The court upheld the validity of the procedure initiated by the landlord

The court began by examining the formal requirements set out in Article L.145-17 of the Commercial Code.

The judges noted that the prior formal notice had indeed been served by extrajudicial document, that it specified the alleged breaches and set out the applicable legal provisions. They also noted that it had remained without effect for more than a month.

The court then observed that the notices of termination had been served in accordance with the statutory six-month period, that they clearly set out the grounds invoked and reminded the tenant of the two-year period available to them to contest them or claim compensation for eviction.

The judges thus concluded that the procedure initiated by the landlord was entirely in order.

Non-payment constitutes a serious and legitimate ground for refusing renewal

On the merits of the case, the court took a particularly firm stance.

It noted that repeated failure to pay rent constitutes a breach of a fundamental obligation under the commercial lease. The judges considered it established that Adagio had repeatedly and persistently failed to meet its payment obligations during the 2020 and 2021 financial years.

The court expressly rejects arguments based on the health crisis. It points out that the exceptional measures adopted during the pandemic never suspended the payment of commercial rent nor authorised its unilateral waiver.

The judges also emphasise that the initiation of conciliation proceedings had no suspensive effect on the performance of the contractual obligations arising from the lease. Adagio therefore remained obliged to pay the rent on the scheduled due dates.

Finally, the court reiterates a fundamental principle: the seriousness of the breaches must be assessed as at the date the notice of termination was served. Consequently, the subsequent settlement of arrears has no bearing on the legitimacy of the refusal to renew.

The complete rejection of the claim for eviction compensation

Considering that the payment defaults were repeated, persistent and significant, the court ruled that the landlords had established the existence of a serious and legitimate ground within the meaning of Article L.145-17 of the Commercial Code.

Consequently, Adagio is deprived of any right to eviction compensation. Nor can it rely on the right to remain in the premises provided for in Article L.145-28 of the Commercial Code.

The court therefore dismissed all of its claims against the owner concerned and ordered it to pay the costs as well as €1,500 on the basis of Article 700 of the Code of Civil Procedure.

Scope of the decision

This judgment is part of a now well-established trend in case law concerning operators of holiday accommodation. Several courts consider that rent deductions made during the health crisis may constitute a serious and legitimate ground for refusing renewal where arrears have persisted despite formal notices from the landlord. For landlords, this decision confirms that an operator who has persistently failed to meet their essential payment obligation may be denied any eviction compensation, even if the arrears were settled several years later.