Commonhold and Leasehold Reform Bill - continued        House of Lords
PART II, LEASEHOLD REFORM - continued
Claim to acquire right - continued

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Counter-notices.     81. - (1) A person who is given a claim notice by a RTM company under section 77(6) may give a notice (referred to in this Chapter as a "counter-notice") to the company no later than the date specified in the claim notice under section 78(6).
 
      (2) A counter-notice is a notice containing a statement either-
 
 
    (a) admitting that the RTM company was on the relevant date entitled to acquire the right to manage the premises specified in the claim notice, or
 
    (b) alleging that, by reason of a specified provision of this Chapter, the RTM company was on that date not so entitled,
  and containing such other particulars (if any) as may be required to be contained in counter-notices, and complying with such requirements (if any) about the form of counter-notices, as may be prescribed by regulations made by the appropriate national authority.
 
      (3) Where the RTM company has been given one or more counter-notices containing a statement such as is mentioned in subsection (2)(b), the company may apply to a leasehold valuation tribunal for a determination that it was on the relevant date entitled to acquire the right to manage the premises.
 
      (4) An application under subsection (3) must be made not later than the end of the period of two months beginning with the day on which the counter-notice (or, where more than one, the last of the counter-notices) was given.
 
      (5) Where the RTM company has been given one or more counter-notices containing a statement such as is mentioned in subsection (2)(b), the RTM company does not acquire the right to manage the premises unless-
 
 
    (a) on an application under subsection (3) it is finally determined that the company was on the relevant date entitled to acquire the right to manage the premises, or
 
    (b) the person by whom the counter-notice was given, or (where more than one) each of the persons by whom such a counter-notice was given, agrees in writing that the company was so entitled.
      (6) If on an application under subsection (3) it is finally determined that the company was not on the relevant date entitled to acquire the right to manage the premises, the claim notice ceases to have effect.
 
      (7) A determination on an application under subsection (3) becomes final-
 
 
    (a) if not appealed against, at the end of the period for bringing an appeal, or
 
    (b) if appealed against, at the time when the appeal (or any further appeal) is disposed of.
      (8) An appeal is disposed of-
 
 
    (a) if it is determined and the period for bringing any further appeal has ended, or
 
    (b) if it is abandoned or otherwise ceases to have effect.
Landlords etc. not traceable.     82. - (1) This section applies where a RTM company wishing to acquire the right to manage premises-
 
 
    (a) complies with subsection (4) or (5) of section 77, and
 
    (b) would not have been precluded from giving a valid notice under that section with respect to the premises,
  but cannot find, or ascertain the identity of, any of the persons to whom the claim notice would be required to be given by subsection (6) of that section.
 
      (2) The RTM company may apply to the court for an order that the company is to acquire the right to manage the premises.
 
      (3) Such an order may be made only if the company has given notice of the application to each person who is the qualifying tenant of a flat contained in the premises.
 
      (4) Before an order is made the company may be required to take such further steps by way of advertisement or otherwise as is determined proper for the purpose of tracing the persons who are-
 
 
    (a) landlords under leases of the whole or any part of the premises, or
 
    (b) parties to such leases otherwise than as landlord or tenant.
      (5) If any of those persons is traced-
 
 
    (a) after an application for an order is made, but
 
    (b) before the making of an order,
  no further proceedings shall be taken with a view to the making of an order.
 
      (6) Where that happens-
 
 
    (a) the rights and obligations of all persons concerned shall be determined as if the company had, at the date of the application, duly given notice under section 77 of its claim to acquire the right to manage the premises, and
 
    (b) the court may give such directions as it thinks fit as to the steps to be taken for giving effect to their rights and obligations, including directions modifying or dispensing with any of the requirements imposed by or by virtue of this Chapter.
      (7) An application for an order may be withdrawn at any time before an order is made and, after it is withdrawn, subsection (6)(a) does not apply.
 
      (8) But where any step is taken for the purpose of giving effect to subsection (6)(a) in the case of any application, the application shall not afterwards be withdrawn except-
 
 
    (a) with the consent of the person or persons traced, or
 
    (b) by leave of the court.
      (9) And leave shall be given only where it appears just that it should be given by reason of matters coming to the knowledge of the RTM company in consequence of the tracing of the person or persons traced.
 
Withdrawal of claim notice.     83. - (1) A RTM company which has given a claim notice in relation to any premises may, at any time before it acquires the right to manage the premises, withdraw the claim notice by giving a notice to that effect (referred to in this Chapter as a "notice of withdrawal").
 
      (2) A notice of withdrawal must be given to each person who is-
 
 
    (a) landlord under a lease of the whole or any part of the premises,
 
    (b) party to such a lease otherwise than as landlord or tenant,
 
    (c) a manager appointed under Part II of the 1987 Act to act in relation to the premises, or any premises containing or contained in the premises, or
 
    (d) the qualifying tenant of a flat contained in the premises.
Deemed withdrawal.     84. - (1) If a RTM company has been given one or more counter-notices containing a statement such as is mentioned in subsection (2)(b) of section 81 but either-
 
 
    (a) no application for a determination under subsection (3) of that section is made within the period specified in subsection (4) of that section, or
 
    (b) such an application is so made but is subsequently withdrawn,
  the claim notice is deemed to be withdrawn.
 
      (2) The withdrawal shall be taken to occur-
 
 
    (a) if paragraph (a) of subsection (1) applies, at the end of the period specified in that paragraph, and
 
    (b) if paragraph (b) of that subsection applies, on the date of the withdrawal of the application.
      (3) The claim notice is deemed to be withdrawn if-
 
 
    (a) a winding-up order or an administration order is made, or a resolution for voluntary winding-up is passed, with respect to the RTM company,
 
    (b) a receiver or a manager of the RTM company's undertaking is duly appointed, or possession is taken, by or on behalf of the holders of any debentures secured by a floating charge, of any property of the RTM company comprised in or subject to the charge,
 
    (c) a voluntary arrangement proposed in the case of the RTM company for the purposes of Part I of the Insolvency Act 1986 is approved under that Part of that Act, or
 
    (d) the RTM company's name is struck off the register under section 652 or 652A of the Companies Act 1985.
Costs: general.     85. - (1) A RTM company is liable for reasonable costs incurred by a person who is-
 
 
    (a) landlord under a lease of the whole or any part of any premises,
 
    (b) party to such a lease otherwise than as landlord or tenant, or
 
    (c) a manager appointed under Part II of the 1987 Act to act in relation to the premises, or any premises containing or contained in the premises,
  in consequence of a claim notice given by the company in relation to the premises.
 
      (2) Any costs incurred by such a person in respect of professional services rendered to him by another are to be regarded as reasonable only if and to the extent that costs in respect of such services might reasonably be expected to have been incurred by him if the circumstances had been such that he was personally liable for all such costs.
 
      (3) A RTM company is liable for any costs which such a person incurs as party to any proceedings under this Chapter before a leasehold valuation tribunal only if the tribunal dismisses an application by the company for a determination that it is entitled to acquire the right to manage the premises.
 
      (4) Any question arising in relation to the amount of any costs payable by a RTM company shall, in default of agreement, be determined by a leasehold valuation tribunal.
 
Costs where claim ceases.     86. - (1) This section applies where a claim notice given by a RTM company-
 
 
    (a) is at any time withdrawn or deemed to be withdrawn by virtue of any provision of this Chapter, or
 
    (b) at any time ceases to have effect by reason of any other provision of this Chapter.
      (2) The liability of the RTM company under section 85 for costs incurred by any person is a liability for costs incurred by him down to that time.
 
      (3) Each person who is or has been a member of the RTM company is also liable for those costs (jointly and severally with the RTM company and each other person who is so liable).
 
      (4) But subsection (3) does not make a person liable if-
 
 
    (a) the lease by virtue of which he was a qualifying tenant has been assigned to another person, and
 
    (b) that other person has become a member of the RTM company.
      (5) The reference in subsection (4) to an assignment includes-
 
 
    (a) an assent by personal representatives, and
 
    (b) assignment by operation of law where the assignment is to a trustee in bankruptcy or to a mortgagee under section 89(2) of the Law of Property Act 1925 (foreclosure of leasehold mortgage).
 
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