CANADA – QUÉBEC Law and Practice Contributed by: Eleonora Eusepi, Sabrina Guillot, Janie Chaloux and Nicolas Gosselin, BCF Business Law LLP
To ensure that the tenant leaves at the expiry of the term, the lease can provide for a waiver by the ten - ant to article 1879, removing the right of tacit recon - duction. Furthermore, the lease can also provide that occupation of the premises after the lease’s expiry will increase the rent payable for the period of occupation concerned by 150%, and even 200% in some leases. This clause would also provide that, should the ten - ant occupy the premises after expiry of the lease, the lease term would be month to month and terminated upon notice by the landlord. 6.18 Right to Assign a Leasehold Interest A commercial tenant may assign its leasehold interest in the lease or sublease all or a portion of the premises unless such right is expressly denied in the lease. If such is permitted, then conditions typically imposed include: • the landlord’s satisfaction with the proposed assignee or subtenant’s financial capacity and creditworthiness; • confirmation that there is no existing default under the lease; • maintaining the initial tenants’ liability under the lease with respect to the assignee’s or sub-lease’s obligations; and • the availability of similar premises in the building (if such is a multi-tenant property). 6.19 Right to Terminate a Lease The right to terminate a commercial lease generally arises from the contractual provisions of the lease and, in the absence of such, the Civil Code. From the landlord’s perspective, termination rights typically stem from: • a tenant’s default in the payment of rent; • failure to comply with an obligation under the lease (such an unauthorised assignment or sublease, maintenance obligations, prohibited uses etc); • the insolvency or bankruptcy of the tenant; or • abandonment of the premises. From the tenant’s perspective, the termination rights are much more limited and generally arise when the landlord fails to grant the tenant with peaceful enjoy -
ment of the premises (if such warranty is provided by the landlord). Additionally, both parties may negotiate express ter - mination rights in the lease itself, such as in the event the premises suffer serious damages which cannot be In Québec, a commercial lease does not need to be registered in the Land Register to be valid between the parties. However, publishing a notice of lease makes the lease opposable to third parties and protects the tenant against termination by a subsequent purchaser. For leases exceeding one year, tenants are advised to publish such a notice in accordance with Article 2999.1 of the Civil Code, a public order provision that cannot be waived. Although a lease may restrict publication of the full agreement for confidentiality reasons, the tenant always retains the right to publish a notice identifying the parties, the description of the premises, and the term. To be registered, a lease or notice of lease must com - ply with the formal requirements of Québec’s Land Register. Registration fees are modest and typically borne by the tenant, who benefits from the resulting protection. Except in the case of leases with a term (including options to renew) exceeding 40 years, no transfer taxes or similar duties apply to the registration of a commercial lease or notice of lease in Québec. 6.21 Forced Eviction A tenant can be forced to vacate the premises prior to the expiration of the Lease in the event of a default. The length of this process depends on the terms of the commercial lease. For example, most commer - cial leases will provide the Landlord the right to termi - nate the Lease ipso facto upon notice to the tenant in the event of a default. Absence of this specific right, the Landlord would have to (in compliance with the Civil Code) obtain a judgment terminating the lease and ordering the tenant to vacate the premises. Any COVID-related eviction moratoriums or restrictions that were previously in place have now lapsed, and no special pandemic era protections currently apply to commercial evictions in Québec. repaired with a specific time frame. 6.20 Registration Requirements
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