Commonhold and Leasehold Reform Bill - continued        House of Lords
PART II, LEASEHOLD REFORM - continued

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Forfeiture of leases of dwellings
No forfeiture notice before determination of breach.     143. - (1) A landlord under a long lease of a dwelling may not serve a notice under section 146(1) of the Law of Property Act 1925 (restriction on forfeiture) in respect of a breach by a tenant of a covenant or condition in the lease unless subsection (2) is satisfied.
 
      (2) This subsection is satisfied if-
 
 
    (a) it has been finally determined on an application under subsection (4) that the breach has occurred,
 
    (b) the tenant has admitted the breach, or
 
    (c) a court in any proceedings, or an arbitral tribunal in proceedings pursuant to a post-dispute arbitration agreement, has finally determined that the breach has occurred.
      (3) But a notice may not be served by virtue of subsection (2)(a) or (c) until after the end of the period of 14 days beginning with the day after that on which the final determination is made.
 
      (4) A landlord under a long lease of a dwelling may make an application to a leasehold valuation tribunal for a determination that a breach of a covenant or condition in the lease has occurred.
 
      (5) But a landlord may not make an application under subsection (4) in respect of a matter which-
 
 
    (a) has been, or is to be, referred to arbitration pursuant to a post-dispute arbitration agreement to which the tenant is a party,
 
    (b) has been the subject of determination by a court, or
 
    (c) has been the subject of determination by an arbitral tribunal pursuant to a post-dispute arbitration agreement.
Section 143: supplementary.     144. - (1) An agreement by a tenant under a long lease of a dwelling (other than a post-dispute arbitration agreement) is void in so far as it purports to provide for a determination-
 
 
    (a) in a particular manner, or
 
    (b) on particular evidence,
  of any question which may be the subject of an application under section 143(4).
 
      (2) For the purposes of section 143 it is finally determined that a breach of a covenant or condition in a lease has occurred-
 
 
    (a) if a decision that it has occurred is not appealed against or otherwise challenged, at the end of the period for bringing an appeal or other challenge, or
 
    (b) if such a decision is appealed against or otherwise challenged and not set aside in consequence of the appeal or other challenge, at the time specified in subsection (3).
      (3) The time referred to in subsection (2)(b) is the time when the appeal or other challenge is disposed of-
 
 
    (a) by the determination of the appeal or other challenge and the expiry of the time for bringing a subsequent appeal (if any), or
 
    (b) by its being abandoned or otherwise ceasing to have effect.
      (4) In section 143 and this section "long lease of a dwelling" does not include-
 
 
    (a) a tenancy to which Part II of the Landlord and Tenant Act 1954 (business tenancies) applies,
 
    (b) a tenancy of an agricultural holding within the meaning of the Agricultural Holdings Act 1986 in relation to which that Act applies, or
 
    (c) a farm business tenancy within the meaning of the Agricultural Tenancies Act 1995.
      (5) In section 143 and this section-
 
 
    "arbitration agreement" and "arbitral tribunal" have the same meaning as in Part I of the Arbitration Act 1996 and "post-dispute arbitration agreement", in relation to any breach (or alleged breach), means an arbitration agreement made after the breach has occurred (or is alleged to have occurred),
 
    "dwelling" has the same meaning as in the 1985 Act,
 
    "landlord" and "tenant" have the same meaning as in Chapter I of this Part, and
 
    "long lease" has the meaning given by sections 73 and 74 of this Act, except that a shared ownership lease is a long lease whatever the tenant's total share.
      (6) Section 146(7) of the Law of Property Act 1925 applies for the purposes of section 143 and this section.
 
      (7) Nothing in section 143 affects the service of a notice under section 146(1) of the Law of Property Act 1925 in respect of a failure to pay-
 
 
    (a) a service charge (within the meaning of section 18(1) of the 1985 Act), or
 
    (b) an administration charge (within the meaning of Part I of Schedule 10 to this Act).
Forfeiture for failure to pay service charge etc.     145. - (1) Section 81 of the Housing Act 1996 (restriction on forfeiture for failure to pay service charge) is amended as follows.
 
      (2) In subsection (1), for the words from "to pay" to the end substitute by a tenant to pay a service charge or administration charge unless-
 
 
    "(a) it is finally determined by (or on appeal from) a leasehold valuation tribunal or by a court, or by an arbitral tribunal in proceedings pursuant to a post-dispute arbitration agreement, that the amount of the service charge or administration charge is payable by him, or
 
    (b) the tenant has admitted that it is so payable."
      (3) For subsection (2) substitute-
 
 
    "(2) The landlord may not exercise a right of re-entry or forfeiture by virtue of subsection (1)(a) until after the end of the period of 14 days beginning with the day after that on which the final determination is made."
 
      (4) For subsection (3) substitute-
 
 
    "(3) For the purposes of this section it is finally determined that the amount of a service charge or administration charge is payable-
 
 
    (a) if a decision that it is payable is not appealed against or otherwise challenged, at the end of the time for bringing an appeal or other challenge, or
 
    (b) if such a decision is appealed against or otherwise challenged and not set aside in consequence of the appeal or other challenge, at the time specified in subsection (3A).
      (3A) The time referred to in subsection (3)(b) is the time when the appeal or other challenge is disposed of-
 
 
    (a) by the determination of the appeal or other challenge and the expiry of the time for bringing a subsequent appeal (if any), or
 
    (b) by its being abandoned or otherwise ceasing to have effect."
      (5) After subsection (4) insert-
 
 
    "(4A) References in this section to the exercise of a right of re-entry or forfeiture include the service of a notice under section 146(1) of the Law of Property Act 1925 (restriction on re-entry or forfeiture)."
 
      (6) In subsection (5), after "this section" insert-
 
 
    "(a) "administration charge" has the meaning given by Part I of Schedule 10 to the Commonhold and Leasehold Reform Act 2001,
 
    (b) "arbitration agreement" and "arbitral tribunal" have the same meaning as in Part I of the Arbitration Act 1996 and "post-dispute arbitration agreement", in relation to any matter, means an arbitration agreement made after a dispute about the matter has arisen,
 
    (c) "dwelling" has the same meaning as in the Landlord and Tenant Act 1985, and
 
    (d) ".
 
Crown application
Application to Crown.     146. - (1) The following provisions apply in relation to land in which there is a Crown interest-
 
 
    (a) sections 18 to 30B of (and the Schedule to) the 1985 Act (service charges, insurance and managing agents),
 
    (b) section 42 (service charges to be held in trust) and sections 46 to 49 (information to be furnished to tenants) of the 1987 Act,
 
    (c) Chapter V of Part I of the 1993 Act (management audit),
 
    (d) section 81 of the Housing Act 1996 (restriction on termination of tenancy for failure to pay service charge etc.),
 
    (e) section 84 of (and Schedule 4 to) that Act (right to appoint surveyor), and
 
    (f) in this Chapter, the provisions relating to any of the provisions within paragraphs (a) to (e), Part I of Schedule 10 and sections 142 to 145.
      (2) There is a Crown interest in land if there is an interest or estate in the land-
 
 
    (a) which is comprised in the Crown Estate,
 
    (b) which belongs to Her Majesty in right of the Duchy of Lancaster,
 
    (c) which belongs to the Duchy of Cornwall, or
 
    (d) which belongs to a government department or is held on behalf of Her Majesty for the purposes of a government department.
      (3) No failure by the Crown to perform a duty imposed by section 21, 22 or 23 of, or by or by virtue of paragraph 2, 3 or 4 of the Schedule to, the 1985 Act makes the Crown criminally liable; but the High Court may declare any such failure without reasonable excuse to be unlawful.
 
 
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