Concept and rule
Concept
The law grants the lessee a right to remain in the premises for life, and beyond in the case of a person cohabiting with the lessee, for example, provided that the lessee respects all his obligations under the lease, even in the case of a verbal lease. This principle does not apply to commercial leases.
To this effect, article 1941 of the Civil Code of Québec states: “A lessee entitled to maintain occupancy and having a lease with a fixed term is entitled by operation of law to its renewal at term. The lease is renewed at term with the same conditions and for the same term or, if the term of the initial lease exceeds 12 months, for a term of 12 months. The parties may, however, agree on a different renewal term.”
Rule
If the immovable is sold under voluntary or forced conditions, the new lessor may not terminate the existing leases. The leases will continue and may be renewed in the same manner as any other lease. The new lessor shall have the same rights and obligations arising from the lease towards the lessees.1 The terms negotiated between the former owner and the lessee will therefore remain in force, for example the terms of rent collection, unless they are the subject of a request for modification that complies with the law.
The application of this right to maintain occupancy is transferred, in some cases, and provided certain conditions are met, to persons cohabiting with the lessee2 at the time of the cessation of cohabitation or the death of the lessee.
For more on this topic, read the article The lessee’s right to maintain occupancy and the repossession of a dwelling by the owner.
► DUTIES AND OBLIGATIONS OF THE BROKER
You must inform your selling client of the conditions for maintaining occupancy in connection with existing leases and disclose this information to any prospective buyer or their broker.
Sometimes, the owner of a multi-unit property may wish to convert it into a divided co-ownership property. This is possible under certain conditions.
For more information on the terms and your obligations, refer to the Professional practices guide – Divided co-ownership.
1Art. 1937 (2) C.C.Q.
2 Art. 1938 C.C.Q.
