Main rules to follow depending on the type of lease in effect

The sale of the immovable in which the leased premises are located does not automatically result in the termination of the lease. Thus, the principle that emerges from the applicable legislation is that the lease will continue to bind the lessee to the new lessor, i.e. the buyer of the immovable.¹

The lessee never has the right to unilaterally terminate the lease; he can only do so with the lessor’s consent. The same does not apply to the buyer,² who becomes the new lessor. The legislator allows the buyer to prematurely and unilaterally terminate the lease under certain conditions. These conditions vary depending on whether the term of the lease is indeterminate or fixed, and whether or not it is published in the Land Register.

Indeterminate term lease

Both the lessor and the lessee may terminate a lease simply by giving notice to this effect.³ The time for giving the notice is the same as the rent payment period. If rent is payable monthly, the notice period will be one month. If rent is payable weekly, the notice period will be one week. However, if the rent payment period exceeds three months, the notice period may not exceed three months.⁴ In this case, the buyer has the same right as the original lessor, and the lessee’s rights remain unchanged.

The publication of an indeterminate term commercial lease does not affect the term of the lease or the possibility of premature termination.

Notice period for a fixed or indeterminate term lease

If 12 months or less remain on the lease

Where 12 months or less remain on the lease when the immovable is sold, no one can terminate it prematurely. The buyer, i.e. the new lessor, must honour the lease to the end of its term, whether or not it is published in the Land Register.⁵

If more than 12 months remain on the lease

If the lease is not published before the registration of the deed of sale itself, the new lessor, i.e. the buyer of the immovable, must honour the lease for a certain period.⁶ He may terminate the lease only upon expiry of the 12 months following the sale, provided he gives the lessee written notice of at least six months. Failure to give such notice will result in the loss of the new owner’s right to terminate the lease, and the lease will have to be honoured until the end of its term.

If the lease was published before the registration of the deed of sale itself, the buyer will have to honour the lease until the end of its term, regardless of duration.

 

 

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¹ Art. 1936 C.C.Q.
² Art. 1937 C.C.Q.
³ Art. 1882 (1) C.C.Q.
⁴ Art. 1882 (2) C.C.Q.
⁵ Art.1887 (2) C.C.Q.
⁶ Ibid.