Amendments proposed to the Commonhold and Leasehold Reform Bill [Lords], As Amended - continued House of Commons

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Abolition of forfeiture
   

Mr Adrian Sanders
Sue Doughty
Dr Brian Iddon
Paul Flynn
Mr Barry Gardiner
Mr Terry Lewis

NC3

To move the following Clause:—

       'A right of re-entry or forfeiture under any proviso or stipulation in a lease of a dwelling for a breach of covenant or condition in the lease shall not be enforceable by action or otherwise.'.


Balance of proceeds of forfeiture to be paid to leaseholder
   

Dr Brian Iddon
Mr Kelvin Hopkins

NC6

To move the following Clause:—

    '( )   Where a forfeiture action is successful, after deduction of all debts any balance shall be paid to the leaseholder.'.


Restrictions on and relief against forfeiture of leases and underleases
   

Dr Brian Iddon
Mr Kelvin Hopkins

NC8

To move the following Clause:—

       '. In section 146 of the Law of Property Act 1925 (c. 20) (restriction on forfeiture) there is inserted—

          (4A)   Where the court has made an order for forfeiture pursuant to subsections (1) to (4) above, any balance remaining after the payment of the lessee's debts owed to the lessor shall be paid to the lessee".'.


Leases exceeding 21 years
   

Mr William Cash
Mr Geoffrey Clifton-Brown
Andrew Selous
Mr John Taylor
Mr Bill Wiggin
Dr Julian Lewis

NC19

To move the following Clause:—

    '.—(1)   This section shall apply to any lease granted for a term of years certain exceeding 21 years, whether or not it is terminable before the end of the term by notice given by or to the tenant or by re-entry, forfeiture or otherwise and whether made before or after the coming into force of this section, where the rent reserved for the time being is less than £1,000 per annum.

    (2)   In this section a right of forfeiture shall mean a provision in a lease whereby the landlord under a lease has a right to re-enter the premises demised (or part thereof) upon the happening of specified events, whether the right to re-enter is expressed as a condition or as a proviso on breach of covenant or otherwise howsoever.

    (3)   No landlord may re-enter the premises demised (nor any part thereof) pursuant to a right of forfeiture, insofar as the exercise of the right of forfeiture is based on the non-payment of money.

    (4)   Where a tenant fails to pay monies payable under the terms of the lease, the person entitled to payment of the said monies shall be entitled to a first legal charge (herein referred to as a "landlord's charge") over the lease for the monies payable and for his reasonable costs and expenses of and in connection with the landlord's charge and the enforcement thereof, such costs and expenses to be payable on the indemnity basis.

    (5)   Subject to the next subsection, a landlord's charge shall have priority to all charges, underleases and other encumbrances estates easements estoppels and rights of whatever description created by or deriving title from or through the tenant, whether at law or in equity and whether created or existing before or after the coming into force of this Act (hereinafter referred to as "subsidiary interests").

    (6)   Notwithstanding the previous subsection, no local land charge within the meaning of the Local Land Charges Act 1975 shall be a subsidiary interest.

    (7)   Subject to the next subsection, a landlord's charge may be enforced in any manner in which a first legal charge may be enforced.

    (8)   The landlord's charge may only be enforced by sale with leave of the High Court or the County Court.

    (9)   On such a sale, the purchaser shall purchase free from all subsidiary interests.

    (10)   Where a landlord's charge has no reasonably realisable commercial value, the landlord may apply to the High Court or the County Court for an order terminating the lease, but such an order shall not release the tenant from any pre-existing obligation under the lease.

    (11)   Any person holding any subsidiary interest shall be entitled to have subrogated to him the landlord's charge on payment of the sums secured by the landlord's charge and shall be entitled to add his reasonable costs and expenses of and in connection the said exercise of the right of subrogation to the landlord's charge, such costs and expenses to be assessed on the indemnity basis.

    (12)   Where more than one person holding a subsidiary interest wishes to have subrogated to him the landlord's charge, the priority as between such persons shall be determined in accordance with the rules of equity.

    (13)   Where on a sale of the lease pursuant to subsection (8) hereof, there is a surplus after payment of all the monies secured by the landlord's charge, the distribution of the said surplus shall be made in accordance with the rules of equity.

    (14)   Rules of Court shall provide for service on the tenant and on persons holding subsidiary interests of any application made pursuant to subsection (8) hereof for leave to enforce the landlord's charge by sale and for the circumstances in which such service may be dispensed with.

    (15)   Notwithstanding the provisions in subsections (4) and (11) hereof permitting the adding of costs and expenses to the landlord's charge, the High Court and the County Court shall have the power to make in substitution for the said provisions some different order as to incidence, basis and amount of the costs and expenses of the holder of the landlord's charge and of the lessee and of any other person where such different order would be just.

    (16)   The figure for the annual rental specified in subsection (1) hereof may be varied from time to time by regulations made by the Secretary of State.

    (17)   Nothing herein shall affect the validity or effect of a forfeiture of a lease, whether by re-entry on or service of originating process seeking to re-enter the premises demised (or part thereof) or otherwise, effected before the coming into effect of this section.

    (18)   "Lease" in this section shall include underleases and "landlord" and "tenant" shall be construed accordingly.

    (19)   The existence or potential existence of a landlord's charge shall not prevent any person who is restricted or prohibited whether by statute or otherwise from lending money save on the security of a first legal charge from lending money on the security of a charge which, but for the existence or potential existence of the landlord's charge, would have been a first legal charge.'.


   

Dr Brian Iddon

26

Page     84,     line     14,     leave out Clause 163.

   

Dr Brian Iddon

27

Page     84,     line     39,     leave out Clause 164.


   

Dr Brian Iddon

28

Page     85,     line     43,     leave out Clause 165.


   

Mr William Cash
Mr Geoffrey Clifton-Brown
Andrew Selous
Mr John Taylor
Mr Bill Wiggin
Dr Julian Lewis

67

Page     86,     line     1     [Clause     165],     after '(1)', insert—

      '(a) for the words "exercise a right of re-entry or forfeiture" substitute "enforce a landlord's charge"; and

      (b)'. 

   

Mr William Cash
Mr Geoffrey Clifton-Brown
Andrew Selous
Mr John Taylor
Mr Bill Wiggin
Dr Julian Lewis

64

Page     86,     line     9     [Clause     165],     leave out 'exercise a right of re-entry or forfeiture' and insert 'enforce a landlord's charge.'.

   

Mr William Cash
Mr Geoffrey Clifton-Brown
Andrew Selous
Mr John Taylor
Mr Bill Wiggin
Dr Julian Lewis

63

Page     86,     line     27     [Clause     165],     leave out subsection (5).


   

Ms Sally Keeble

55

Page     87,     line     17     [Clause     166],     leave out '162' and insert '161'.

   

Ms Sally Keeble

61

Page     87,     line     17     [Clause     166],     at end insert 'and sections (Failure to pay small amount for short period) and (Power to prescribe additional or different requirements).'.


   

Mr William Cash
Mr Geoffrey Clifton-Brown
Andrew Selous
Mr John Taylor
Mr Bill Wiggin
Dr Julian Lewis

69

Page     127     [Schedule     12],     leave out lines 36 to 39.


   

Ms Sally Keeble

56

Page     129,     line     21     [Schedule     12],     after 'proceedings' insert 'by a determination under this paragraph'.


   

Ms Sally Keeble

57

Page     88,     line     22     [Clause     169],     at end insert—

    '(5A)   The Lands Tribunal may not order a party to the appeal to pay costs incurred by another party in connection with the appeal unless he has, in the opinion of the Lands Tribunal, acted frivolously, vexatiously, abusively, disruptively or otherwise unreasonably in connection with the appeal.

    (5B)   In such a case the amount he may be ordered to pay shall not exceed the maximum amount which a party to proceedings before a leasehold valuation tribunal may be ordered to pay in the proceedings under or by virtue of paragraph 10(3) of Schedule 12.'.


   

Mr William Cash
Mr Geoffrey Clifton-Brown
Andrew Selous
Mr John Taylor
Mr Bill Wiggin
Dr Julian Lewis

65

Page     129,     line     35     [Schedule     13],     after 'amendments', insert—

    '1A.   In section 1AA(3) after "Secretary of State" insert:

      "(aa) the tenancy was granted for a term of years certain not exceeding 80 years.".'.

 
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Prepared 11 Mar 2002