Dax Judicial Court, 1st Chamber, 1 July 2026, No. 25/00016
Holiday accommodation: an irregular notice of termination is not void and entitles the tenant to compensation for eviction
On 1 July 2026, the Dax Judicial Court handed down an important ruling concerning commercial leases relating to a holiday accommodation complex operated by Pierre & Vacances. The judgement reiterates a now well-established principle: where a landlord serves a notice of termination with a refusal to renew, citing a serious and legitimate ground but failing to comply with the requirements of Article L. 145-17 of the Commercial Code, the notice is not void. It takes effect but obliges the landlord to pay eviction compensation to the tenant.
Residence operated under the Pierre & Vacances brand
In 2003, two owners purchased a flat situated in a holiday residence operated under the Pierre & Vacances brand. An initial commercial lease was entered into with the operator, then renewed on 12 August 2013 for a term of ten years, until 30 September 2023.
On 21 February 2023, the landlords served a notice of termination with a refusal to renew, without offering any compensation for eviction, citing a serious and legitimate ground relating to disturbances and defects attributed to the operator. The operator contested the validity of the notice of termination, arguing in particular that no prior formal notice had been served on them in accordance with Article L. 145-17 of the Commercial Code. Following several exchanges between the parties regarding the calculation of the eviction compensation, the landlords brought the matter before the court to have the amount determined, to obtain the return of the keys and to set an occupation allowance.
The notice of termination remains valid despite the absence of a formal notice
The operator argued that the notice of termination was null and void since the landlords had invoked a serious and legitimate ground without having served the formal notice required by Article L. 145-17 of the Commercial Code. In his view, this irregularity should have resulted in the lease continuing by tacit renewal.
The court rejected this argument.
It noted that the case law of the Court of Cassation distinguishes between the irregularity of the notice of termination and its validity. Even where a landlord fails to comply with the conditions for refusing to pay compensation for eviction, they still retain the right to refuse to renew the lease, provided they compensate the tenant. The absence of a formal notice of default therefore does not render the notice of termination null and void; it merely deprives the landlord of the benefit of refusing to pay compensation. The tenancy comes to an end, but the tenant acquires a right to eviction compensation as well as a right to remain in the premises until such compensation is paid.
This ruling is consistent with the established case law of the Third Civil Chamber of the Court of Cassation.
Compensation for eviction is due
The landlords argued that the tenant had not made any quantified claim and that, consequently, no compensation should be paid to him.
The court rejected this argument. It pointed out that it is the landlord, as the party refusing renewal, who bears the burden of paying compensation for eviction. The fact that the tenant does not specify a precise figure in their claim does not exempt the landlord from this obligation. Furthermore, an earlier letter from 2013 referring to a possible waiver of compensation is deemed irrelevant, as the lease renewed a few weeks later does not include any such clause.
The principle of compensation for eviction is therefore definitively established.
Compensation calculated solely on the basis of the turnover of the unit
The court adopted a method of particular relevance to holiday residences.
It held that the compensation must be assessed exclusively on the basis of the turnover generated by the lessors’ own flat alone, and not on the basis of the residence’s overall business activity.
As the operator did not produce any accounting documents enabling the loss to be assessed, the court relied solely on the documents provided by the owners. These showed a turnover of €7,399.22 for the period from 1 October 2023 to 30 September 2024. In the absence of data for the three previous financial years, this single period was used as the basis for calculation.
Applying the ‘hotel method’, the court applied a multiplier of 2, taking into account, in particular, the nature of the property (a one-bedroom flat sleeping six), its good condition and its coastal location, whilst also considering the competition from other holiday resorts. The principal compensation is therefore set at €14,798.44.
Rejection of ancillary claims
Pierre & Vacances also sought reinvestment compensation amounting to approximately 10 per cent of the principal compensation, as well as compensation for disruption to business.
The court dismissed both these claims.
It noted that the operator had provided no evidence to substantiate the costs it claimed to have incurred in acquiring a new business and had not provided any evidence to assess any commercial disruption. In the absence of proof of loss, no additional compensation was awarded.
Compensation for occupation without a reduction for precariousness
The court ordered the keys to be returned within eight days of full payment of the eviction compensation, subject to a penalty of €100 per day of delay.
Regarding the occupation compensation due whilst the operator remained on the premises, the court set an annual amount of €7,399.22, corresponding to the rental value of the property. However, it refuses to apply the 10 per cent precariousness allowance requested by the operator. According to the court, given the length of the dispute and the normal operation of a holiday residence, PV Exploitation France has failed to demonstrate any particular situation of precariousness justifying such a reduction.
Scope of the decision
This decision is of significant practical importance for disputes involving holiday residences. It confirms that an irregular notice of termination based on a serious and legitimate ground does not thereby become null and void: it terminates the lease but simply gives rise to a right to payment of eviction compensation. The judgement also illustrates a case-by-case approach to assessing this compensation, based on the turnover generated by the unit in question alone, whilst reiterating that ancillary compensation and the ‘precariousness’ allowance are never automatic and must be substantiated by specific evidence.
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