My tenant does not comply with the agreed guarantee

12 january 2021 - "I own a flat in Veyrier which I have been renting since 1 July 2020. According to the lease contract, the tenant had to provide me with a three-month rent guarantee before the keys were handed over. He entered the premises on 1 July last but has still not signed the rental guarantee despite my numerous reminders. What can I do? "Laure MEYER, CGI Conseils lawyer, answers François S., Veyrier.

My tenant does not comply with the agreed guarantee

The conclusion of a lease presupposes the transfer of the leased property by the lessor to the tenant. It is extremely important to choose the right tenant because the lessor exposes himself to significant financial risks. Indeed, it may happen that the tenant stops paying his rent for a more or less important period or returns the flat with important defects.

In such cases, security or rent guarantees are, for residential leases, a valuable asset for the landlord in order to obtain compensation. Even if it is possible for the landlord to terminate the lease early in the event of non-payment, for example, this measure does not, however, enable him to obtain financial compensation.

To prevent these risks, the lessor can ask the tenant for securities. The provision of securities must be provided for in the contract. It is not a legal requirement but a contractual obligation of the tenant.

The law provides that security shall be provided in cash or in the form of securities. The amount must be deposited in an account at a bank, a savings or deposit account in the name of the tenant. The landlord may not keep the amount of the security in his assets. The amount remains on a blocked account and neither the landlord nor the tenant can freely use it. For residential leases, the amount of the rent guarantee may not exceed three months' rent. In practice, it is common for the tenant to take direct steps to set up the securities and then to send all the necessary information to the landlord.

In principle, the securities must be lodged before the premises are handed over to the tenant. If the Tenant fails to provide security before the leased item is handed over, the Lessor may refuse to hand over the premises on the basis of a plea of default. In addition, if the Tenant has been given an additional period of notice to perform and such notice of default is unsuccessful, the Lessor may withdraw from the contract before the delivery of the object.

Your case is different as long as the Tenant is already in the flat. However, it is possible to envisage an extraordinary termination of the lease contract binding you to your tenant under strict conditions. Part of the doctrine considers the breach of the tenant's obligation to provide guarantees to be a case of extraordinary termination of the lease. Indeed, the repeated and continuous breach by the tenant of his contractual obligations, making the continuation of the lease unbearable, is grounds for early termination.

I recommend that you send a final formal notice to your tenant, giving him/her a period of time to comply. If the bank guarantee is not provided within the prescribed period, you may terminate the lease with 30 days' notice for the end of a month. Alternatively, you can also terminate the lease contract for the next contractual term.

by Laure MEYER, Lawyer CGI Conseils

For any further information, CGI Conseils is at your disposal in the morning from 8:30 am to 11:30 am on tel. 022 715 02 10 or by appointment.