August 07, 2020
A first of a kind case relating to COVID-19 has been carefully observed in a Québec court, which ruled a commercial landlord was not entitled to collect rent from its tenant due to a government decree that constituted a force majeure.
A piece in The Lawyer’s Daily talks about a Québec case between a landlord who sued its fitness centre tenant over unpaid rent after the gym was deemed a non-essential business by the Québec government and was forced to close for three months due to the pandemic.
The article says this decision “underlines the importance of carefully drafting force majeure clauses and highlights the weight the courts will give to the notion of peaceable enjoyment.”
“It is a well-reasoned decision that turns very much on the particular text of the force majeure clause in this case,” said Litigation and Dispute Resolution partner Christopher Richter when speaking to The Lawyer's Daily.
“It shows a willingness on the part of the court to push hard to provide some relief for tenants so I think it’s a somewhat troubling precedent for landlords.
READ: Torys lawyers have penned several analyses of force majeure in the wake of the pandemic, read “COVID-19 and forces majeure classes: key consideration, implications, and practice tips” on the COVID-19 guidance for organizations page.
“It shows a pretty liberal interpretation of what the courts will see as being the impossibility in the case of a landlord providing peaceable enjoyment because it is linked to the use the tenant was intended to make of it.”
You can learn more about our Litigation and Dispute Resolution team and read their insights on the practice page.