Commonhold and Leasehold Reform Bill - continued        House of Lords
PART I, COMMONHOLD - continued
Common parts - continued

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Charges: general prohibition.     27. - (1) It shall not be possible to create a charge over common parts.
 
      (2) An instrument or agreement shall be of no effect to the extent that it purports to create a charge over common parts.
 
      (3) Where by virtue of section 7 or 9 a commonhold association is registered as the proprietor of common parts, a charge which relates wholly or partly to the common parts shall be extinguished by virtue of this subsection to the extent that it relates to the common parts.
 
      (4) Where by virtue of section 29 land vests in a commonhold association following an amendment to a commonhold community statement which has the effect of adding land to the common parts, a charge which relates wholly or partly to the land added shall be extinguished by virtue of this subsection to the extent that it relates to that land.
 
      (5) This section is subject to section 28 (which permits certain mortgages).
 
New legal mortgages.     28. - (1) Section 27 shall not apply in relation to a legal mortgage if the creation of the mortgage is approved by a resolution of the commonhold association.
 
      (2) A resolution for the purposes of subsection (1) must be passed-
 
 
    (a) before the mortgage is created, and
 
    (b) unanimously.
      (3) In this section "legal mortgage" has the meaning given by section 205(1)(xvi) of the Law of Property Act 1925 (interpretation).
 
Additions to common parts.     29. - (1) This section applies where an amendment of a commonhold community statement-
 
 
    (a) specifies land which forms part of a commonhold unit, and
 
    (b) provides for that land (the "added land") to be added to the common parts.
      (2) The amendment may not be made unless the registered proprietor of any charge over the added land consents-
 
 
    (a) in writing, and
 
    (b) before the amendment is made.
      (3) But regulations may enable a court to dispense with the requirement for consent on the application of a commonhold association in specified circumstances.
 
      (4) On the filing of the amended statement under section 32-
 
 
    (a) the commonhold association shall be entitled to be registered as the proprietor of the freehold estate in the added land, and
 
    (b) the Registrar shall register the commonhold association in accordance with paragraph (a) (without an application being made).
 
Commonhold community statement
Form and content: general.     30. - (1) A commonhold community statement is a document which makes provision in relation to specified land for-
 
 
    (a) the rights and duties of the commonhold association, and
 
    (b) the rights and duties of the unit-holders.
      (2) A commonhold community statement must be in the prescribed form.
 
      (3) A commonhold community statement may-
 
 
    (a) impose a duty on the commonhold association;
 
    (b) impose a duty on a unit-holder;
 
    (c) make provision about the taking of decisions in connection with the management of the commonhold or any other matter concerning it.
      (4) Subsection (3) is subject to-
 
 
    (a) any provision made by or by virtue of this Part, and
 
    (b) any provision of the memorandum or articles of the commonhold association.
      (5) In subsection (3)(a) and (b) "duty" includes, in particular, a duty-
 
 
    (a) to pay money;
 
    (b) to undertake works;
 
    (c) to grant access;
 
    (d) to give notice;
 
    (e) to refrain from entering into transactions of a specified kind in relation to a commonhold unit;
 
    (f) to refrain from using the whole or part of a commonhold unit for a specified purpose or for anything other than a specified purpose;
 
    (g) to refrain from undertaking works (including alterations) of a specified kind;
 
    (h) to refrain from causing nuisance or annoyance;
 
    (i) to refrain from specified behaviour;
 
    (j) to indemnify the commonhold association or a unit-holder in respect of costs arising from the breach of a statutory requirement.
      (6) Provision in a commonhold community statement imposing a duty to pay money (whether in pursuance of subsection (5)(a) or any other provision made by or by virtue of this Part) may include provision for the payment of interest in the case of late payment.
 
      (7) A duty conferred by a commonhold community statement on a commonhold association or a unit-holder shall not require any other formality.
 
      (8) A commonhold community statement may not provide for the transfer or loss of an interest in land on the occurrence or non-occurrence of a specified event.
 
      (9) Provision made by a commonhold community statement shall be of no effect to the extent that-
 
 
    (a) it is prohibited by virtue of section 31,
 
    (b) it is inconsistent with any provision made by or by virtue of this Part,
 
    (c) it is inconsistent with anything which is treated as included in the statement by virtue of section 31, or
 
    (d) it is inconsistent with the memorandum or articles of association of the commonhold association.
Regulations.     31. - (1) Regulations shall make provision about the content of a commonhold community statement.
 
      (2) The regulations may permit, require or prohibit the inclusion in a statement of-
 
 
    (a) specified provision, or
 
    (b) provision of a specified kind, for a specified purpose or about a specified matter.
      (3) The regulations may-
 
 
    (a) provide for a statement to be treated as including provision prescribed by or determined in accordance with the regulations;
 
    (b) permit a statement to make provision in place of provision which would otherwise be treated as included by virtue of paragraph (a).
      (4) The regulations may-
 
 
    (a) make different provision for different descriptions of commonhold association or unit-holder;
 
    (b) make different provision for different circumstances;
 
    (c) make provision about the extent to which a commonhold community statement may make different provision for different descriptions of unit-holder or common parts.
      (5) The matters to which regulations under this section may relate include, but are not limited to-
 
 
    (a) the matters mentioned in sections 11, 14, 15, 20, 24, 25, 26, 37, 38 and 56, and
 
    (b) any matter for which regulations under section 36 may make provision.
Amendment.     32. - (1) Regulations under section 31 shall require a commonhold community statement to make provision about how it can be amended.
 
      (2) The regulations shall, in particular, make provision under section 31(3)(a) (whether or not subject to provision under section 31(3)(b)).
 
      (3) An amendment of a commonhold community statement shall have no effect unless and until the amended statement is registered in accordance with this section.
 
      (4) If the commonhold association makes an application under this subsection the Registrar shall arrange for an amended commonhold community statement to be kept in his custody, and referred to in the register, in place of the unamended statement.
 
      (5) An application under subsection (4) must be accompanied by a certificate given by the directors of the commonhold association that the amended commonhold community statement satisfies the requirements of this Part.
 
      (6) Where an amendment of a commonhold community statement redefines the extent of a commonhold unit, an application under subsection (4) must be accompanied by any consent required by section 22(1) or 23(2) (or an order of a court dispensing with consent).
 
      (7) Where an amendment of a commonhold community statement has the effect of changing the extent of the common parts, an application under subsection (4) must be accompanied by any consent required by section 29(2) (or an order of a court dispensing with consent).
 
      (8) Where the Registrar amends the register on an application under subsection (4) he shall make any consequential amendments to the register which he thinks appropriate.
 
 
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