Imagine you’ve found the perfect spot to rent for your business in the heart of Montreal. The location is ideal, there’s high foot traffic and excellent visibility, making it a prime spot for your target market. To help protect your rights as a tenant and make your lease enforceable against third parties, we recommend publishing it with the Land Register.
What Is a Commercial Lease?
A commercial lease is an agreement between a landlord and a tenant to use commercial space to conduct business for a fixed term in exchange for consideration. The Civil Code of Quebec (the “C.C.Q.”) contains the rules for commercial leasing that apply unless the lease agreement states otherwise. Read our previous blog post on everything you need to know about commercial leasing to help you get started.
In Quebec, the process of publishing a commercial lease involves specific legal requirements that must be followed to ensure compliance with the law and protect the rights and interests of both landlords and tenants.
The Process of Publishing a Commercial Lease in Quebec
Once a legally binding lease agreement is drafted, the next step is publishing. The lease agreement should include the essential terms, such as the rent amount, the duration of the lease, the responsibilities for repairs and maintenance, and other provisions that are relevant to the specific business and property. While the C.C.Q. governs the framework for commercial leasing, it leaves the door open for parties to negotiate their terms and conditions. To ensure a fairly drafted lease, consult with our business law firm to help you negotiate the terms of your agreement.
In Quebec, a commercial lease can be published in one of three ways: by publishing the entire lease, by presenting a summary of the lease, or through a notice.
A clause contained in a lease that attempts to prohibit or restrict the right of either party to publish the lease is without effect [1]. However, it is possible to negotiate a clause that prohibits publishing the entirety of the lease. As a result, the majority of these commercial agreements are published by way of notice, which must be certified by a notary or a lawyer. This simultaneously allows the confidential information in the lease to remain private while allowing the parties to gain the protection afforded by publishing. For example, many landlords do not want the amount of rent their tenant pays to be made public knowledge.
The notice:
Refers to the lease;
Identifies the parties;
Describes the building in which the leased premise is situated;
States the effective date of the lease;
States the expiry of the lease;
Mentions any renewal rights [2].
Protection of Rights and Interests
Publishing a commercial lease creates a public record of the lease agreement, which establishes rights against third parties. It protects the tenant's rights by providing a clear and documented record of the lease agreement, including its terms and conditions.
If the lease is not published, and the building in which the premises are located is sold, then the new owner may give the tenant a six-month written notice to vacate the premises within 12 months, regardless of how much time is left on the lease.
However, where a tenant has published the lease, they cannot be evicted by the new owner if the landlord sells the building [3].
To be enforceable against third parties, the lease must be published before the sale of the property or before the publication by a creditor of a notice exercising a hypothecary right.
Conclusion
Publishing a commercial lease in Quebec is a crucial process that ensures legal compliance, protects the rights and interests of both landlords and tenants and enhances business relationships. Compliance with the legal requirements of publishing a commercial lease is essential to avoid potential legal disputes, liabilities, and financial risks.
As a business law firm, we urge Quebec-based businesses to publish their commercial leases to protect their legal rights, ensure transparency, and promote smooth business operations. For inquiries or assistance with lease publication, our experienced team of business law experts is here to help.
This blog post is not legal advice and is for general informational purposes only. Always speak with a lawyer before acting on any of the information contained herein.
[1] s 2936 C.C.Q.
[2] s 2999.1 C.C.Q.
[3] s 1887 para 2 C.C.Q.