The Termination clause is subject to the approval of the court
Article L145-41 of the French Commercial Code sets out the procedures for implementing resolutory clauses in commercial leases.
Resolutory clause and payment order:
An automatic termination clause in a commercial lease only takes effect one month after the issue of an unsuccessful summons to pay. To be valid, the summons must mention this one-month period. This means that the tenant has one month to regularize the situation before the resolutory clause can be activated.
Power of the judge :
If a judge is seized of an application under article 1343-5 of the French Civil Code (which allows for the granting of payment deadlines), he may, by granting deadlines to the tenant, suspend the realization and effects of the resolutory clauses. This suspension is possible as long as the termination has not been established or pronounced by a court decision that has acquired the authority of res judicata.
As a reminder, article 1343-5 of the French Civil Code states:
“The judge may, taking into account the situation of the debtor and in consideration of the needs of the creditor, defer or stagger payment of the sums due, up to a limit of two years.
By special reasoned decision, he may order that the sums corresponding to the deferred instalments bear interest at a reduced rate at least equal to the legal rate, or that the payments be applied first to the capital.
The judge may make these measures conditional on the debtor taking steps to facilitate or guarantee payment of the debt.
The judge’s decision suspends any enforcement proceedings initiated by the creditor. The interest increases or penalties provided for in the event of delay are not incurred during the period set by the judge.
Any stipulation to the contrary is deemed unwritten.
The provisions of the present article do not apply to maintenance debts.
Suspension of the resolutory clause :
The resolutory clause cannot be enforced if the tenant releases himself under the conditions set by the judge, i.e. if he pays the sums due according to the additional deadlines granted by the court.
In short, this article protects the tenant by giving him one month to remedy his default before the resolutory clause can take effect. In addition, it gives the judge the option of granting additional time to the tenant, which may suspend the application of the resolutory clause, as long as the tenant complies with the conditions imposed by the judge.
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