Joint and Several Liability of the Outgoing Tenant in the Event of Transfer of a Commercial Lease

Facts

The dispute opposes [J.], the outgoing tenant, to [A.], the landlord, regarding J.'s joint and several liability in the event of transfer of a commercial lease. The initial lease was concluded for ten years, from September 1, 1988, to September 30, 1998, and was renewed every five years. [J.] transferred the lease to [M.] on November 1, 1990, but [M.] stopped paying rent as of November 1991. [A.] terminated the lease on May 31, 1992, due to M.'s default and initiated an eviction procedure. The Civil Court of the Cantonal Tribunal confirmed the validity of the transfer of the lease to [M.] and ordered [J.] to pay [A.] the unpaid rent and the indemnity for unlawful occupation.

The parties initiated several procedures, including an action for debt release and an eviction procedure. The Civil Court of the Cantonal Tribunal rendered a judgment on January 28, 1994, which was confirmed by the Court of Appeal on November 1, 1994. [J.] filed an appeal with the Federal Tribunal, which dismissed the appeal and confirmed the judgment under attack.

Considerations

The Federal Tribunal examined the issue of the joint and several liability of the outgoing tenant in the event of transfer of a commercial lease. According to art. 263 al. 4 CO, the outgoing tenant is jointly and severally liable with the third party until the expiration of the lease term or its termination according to the contract or the law, but in any case, for a maximum of two years.

The cantonal court considered that the transferring tenant is liable for the indemnity for unlawful occupation of the premises owed by the transferee tenant whose lease was terminated due to default and who did not vacate the premises, provided that the two-year period has not expired. The Federal Tribunal confirmed this decision, considering that the joint and several liability of the outgoing tenant extends not only to the obligation to pay rent but also to other obligations, such as the obligation to restore the leased property after damage caused by the transferee.

The Federal Tribunal also examined the issue of the interpretation of art. 263 al. 4 CO, which does not specify the scope of the joint and several liability of the…