Commonhold and Leasehold Reform Act 2002 (c. 15)

(The document as of February, 2008)

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(b) a person acquiring land which he is obliged to acquire by virtue of a prescribed enactment or in prescribed circumstances.

61 Matrimonial rights

In the following provisions of this Part a reference to a tenant includes a reference to a person who has matrimonial home rights (within the meaning of section 30(2) of the Family Law Act 1996 (c. 27) (matrimonial home)) in respect of a commonhold unit--

(a) section 19,

(b) section 35, and

62 Advice

(1) The Lord Chancellor may give financial assistance to a person in relation to the provision by that person of general advice about an aspect of the law of commonhold land, so far as relating to residential matters.

(2) Financial assistance under this section may be given in such form and on such terms as the Lord Chancellor thinks appropriate.

(3) The terms may, in particular, require repayment in specified circumstances.

63 The Crown

This Part binds the Crown.

General

64 Orders and regulations

(1) In this Part "prescribed" means prescribed by regulations.

(2) Regulations under this Part shall be made by the Lord Chancellor.

(3) Regulations under this Part--

(a) shall be made by statutory instrument,

(b) may include incidental, supplemental, consequential and transitional provision,

(d) may make different provision for different purposes, and

(e) shall be subject to annulment in pursuance of a resolution of either House of Parliament.

65 Registration procedure

(1) The Lord Chancellor may make rules about--

(a) the procedure to be followed on or in respect of commonhold registration documents, and

(b) the registration of freehold estates in commonhold land.

(2) Rules under this section--

(a) shall be made by statutory instrument in the same manner as land registration rules within the meaning of the Land Registration Act 2002 (c. 9),

(b) may make provision for any matter for which provision is or may be made by land registration rules, and

(c) may provide for land registration rules to have effect in relation to anything done by virtue of or for the purposes of this Part as they have effect in relation to anything done by virtue of or for the purposes of that Act.

(3) Rules under this section may, in particular, make provision--

(a) about the form and content of a commonhold registration document;

(b) enabling the Registrar to cancel an application by virtue of this Part in specified circumstances;

(c) enabling the Registrar, in particular, to cancel an application by virtue of this Part if he thinks that plans submitted with it (whether as part of a commonhold community statement or otherwise) are insufficiently clear or accurate;

(d) about the order in which commonhold registration documents and general registration documents are to be dealt with by the Registrar;

(e) for registration to take effect (whether or not retrospectively) as from a date or time determined in accordance with the rules.

(4) The rules may also make provision about satisfaction of a requirement for an application by virtue of this Part to be accompanied by a document; in particular the rules may--

(a) permit or require a copy of a document to be submitted in place of or in addition to the original;

(b) require a copy to be certified in a specified manner;

(5) A commonhold registration document must be accompanied by such fee (if any) as is specified for that purpose by order under section 102 of the Land Registration Act 2002 (c. 9)(fee orders).

(6) In this section--

"commonhold registration document" means an application or other document sent to the Registrar by virtue of this Part, and
"general registration document" means a document sent to the Registrar under a provision of the Land Registration Act 2002.

66 Jurisdiction

(1) In this Part "the court" means the High Court or a county court.

(2) Provision made by or under this Part conferring jurisdiction on a court shall be subject to provision made under section 1 of the Courts and Legal Services Act 1990 (c. 41) (allocation of business between High Court and county courts).

(3) A power under this Part to confer jurisdiction on a court includes power to confer jurisdiction on a tribunal established under an enactment.

(4) Rules of court or rules of procedure for a tribunal may make provision about proceedings brought--

(a) under or by virtue of any provision of this Part, or

(b) in relation to commonhold land.

67 The register

(1) In this Part--

"the register" means the register of title to freehold and leasehold land kept under section 1 of the Land Registration Act 2002,
"registered" means registered in the register, and
"the Registrar" means the Chief Land Registrar.

(2) Regulations under any provision of this Part may confer functions on the Registrar (including discretionary functions).

(3) The Registrar shall comply with any direction or requirement given to him or imposed on him under or by virtue of this Part.

(4) Where the Registrar thinks it appropriate in consequence of or for the purpose of anything done or proposed to be done in connection with this Part, he may--

(a) make or cancel an entry on the register;

(b) take any other action.

(5) Subsection (4) is subject to section 6(2).

68 Amendments

Schedule 5 (consequential amendments) shall have effect.

69 Interpretation

(1) In this Part--

"instrument" includes any document, and
"object" in relation to a commonhold association means an object stated in the association's memorandum of association in accordance with section 2(1)(c) of the Companies Act 1985 (c. 6).

(2) In this Part--

(a) a reference to a duty to insure includes a reference to a duty to use the proceeds of insurance for the purpose of rebuilding or reinstating, and

(b) a reference to maintaining property includes a reference to decorating it and to putting it into sound condition.

(3) A provision of the Law of Property Act 1925 (c. 20), the Companies Act 1985 (c. 6) or the Land Registration Act 2002 (c. 9) defining an expression shall apply to the use of the expression in this Part unless the contrary intention appears.

70 Index of defined expressions

In this Part the expressions listed below are defined by the provisions specified.

Expression	Interpretation provision
Common parts	Section 25
A commonhold	Section 1
Commonhold association	Section 34
Commonhold community statement	Section 31
Commonhold land	Section 1
Commonhold unit	Section 11
Court	Section 66
Declaration of solvency	Section 43
Developer	Section 58
Development business	Section 58
Exercising functions	Section 8
Insolvent commonhold association	Section 50
Instrument	Section 69
Insure	Section 69
Joint unit-holder	Section 13
Liquidator (sections 44 to 49)	Section 44
Maintenance	Section 69
Object	Section 69
Prescribed	Section 64
The register	Section 67
Registered	Section 67
Registered freeholder	Section 2
The Registrar	Section 67
Regulations	Section 64
Residential commonhold unit	Section 17
Succession order	Section 51
Successor commonhold association	Section 50
Termination application	Section 46
Termination-statement resolution	Section 43
Transfer (of unit)	Section 15
Transitional period	Section 8
Unit-holder	Section 12
Winding-up resolution	Section 43

Part 2 Leasehold reform

Chapter 1 Right to manage

Introductory

71 The right to manage

(1) This Chapter makes provision for the acquisition and exercise of rights in relation to the management of premises to which this Chapter applies by a company which, in accordance with this Chapter, may acquire and exercise those rights (referred to in this Chapter as a RTM company).

(2) The rights are to be acquired and exercised subject to and in accordance with this Chapter and are referred to in this Chapter as the right to manage.

Qualifying rules

72 Premises to which Chapter applies

(1) This Chapter applies to premises if--

(a) they consist of a self-contained building or part of a building, with or without appurtenant property,

(b) they contain two or more flats held by qualifying tenants, and

(c) the total number of flats held by such tenants is not less than two-thirds of the total number of flats contained in the premises.

(2) A building is a self-contained building if it is structurally detached.

(3) A part of a building is a self-contained part of the building if--

(a) it constitutes a vertical division of the building,

(b) the structure of the building is such that it could be redeveloped independently of the rest of the building, and

(4) This subsection applies in relation to a part of a building if the relevant services provided for occupiers of it--

(a) are provided independently of the relevant services provided for occupiers of the rest of the building, or

(b) could be so provided without involving the carrying out of works likely to result in a significant interruption in the provision of any relevant services for occupiers of the rest of the building.

(5) Relevant services are services provided by means of pipes, cables or other fixed installations.

(6) Schedule 6 (premises excepted from this Chapter) has effect.

73 RTM companies

(1) This section specifies what is a RTM company.

(2) A company is a RTM company in relation to premises if--

(a) it is a private company limited by guarantee, and

(b) its memorandum of association states that its object, or one of its objects, is the acquisition and exercise of the right to manage the premises.

(3) But a company is not a RTM company if it is a commonhold association (within the meaning of Part 1).

(4) And a company is not a RTM company in relation to premises if another company is already a RTM company in relation to the premises or to any premises containing or contained in the premises.

(5) If the freehold of any premises is conveyed or transferred to a company which is a RTM company in relation to the premises, or any premises containing or contained in the premises, it ceases to be a RTM company when the conveyance or transfer is executed.

74 RTM companies: membership and regulations

(1) The persons who are entitled to be members of a company which is a RTM company in relation to premises are--

(a) qualifying tenants of flats contained in the premises, and

(b) from the date on which it acquires the right to manage (referred to in this Chapter as the "acquisition date"), landlords under leases of the whole or any part of the premises.

(2) The appropriate national authority shall make regulations about the content and form of the memorandum of association and articles of association of RTM companies.

(3) A RTM company may adopt provisions of the regulations for its memorandum or articles.

(4) The regulations may include provision which is to have effect for a RTM company whether or not it is adopted by the company.

(5) A provision of the memorandum or articles of a RTM company has no effect to the extent that it is inconsistent with the regulations.

(6) The regulations have effect in relation to a memorandum or articles--

(a) irrespective of the date of the memorandum or articles, but

(b) subject to any transitional provisions of the regulations.

(7) The following provisions of the Companies Act 1985 (c. 6) do not apply to a RTM company--

(a) sections 2(7) and 3 (memorandum), and

(b) section 8 (articles).

75 Qualifying tenants

(1) This section specifies whether there is a qualifying tenant of a flat for the purposes of this Chapter and, if so, who it is.

(2) Subject as follows, a person is the qualifying tenant of a flat if he is tenant of the flat under a long lease.

(3) Subsection (2) does not apply where the lease is a tenancy to which Part 2 of the Landlord and Tenant Act 1954 (c. 56) (business tenancies) applies.

(4) Subsection (2) does not apply where--

(a) the lease was granted by sub-demise out of a superior lease other than a long lease,

(b) the grant was made in breach of the terms of the superior lease, and

(5) No flat has more than one qualifying tenant at any one time; and subsections (6) and (7) apply accordingly.

(6) Where a flat is being let under two or more long leases, a tenant under any of those leases which is superior to that held by another is not the qualifying tenant of the flat.

(7) Where a flat is being let to joint tenants under a long lease, the joint tenants shall (subject to subsection (6)) be regarded as jointly being the qualifying tenant of the flat.

76 Long leases

(1) This section and section 77 specify what is a long lease for the purposes of this Chapter.

(2) Subject to section 77, a lease is a long lease if--

(a) it is granted for a term of years certain exceeding 21 years, whether or not it is (or may become) terminable before the end of that term by notice given by or to the tenant, by re-entry or forfeiture or otherwise,

(b) it is for a term fixed by law under a grant with a covenant or obligation for perpetual renewal (but is not a lease by sub-demise from one which is not a long lease),

(c) it takes effect under section 149(6) of the Law of Property Act 1925 (c. 20) (leases terminable after a death or marriage),

(d) it was granted in pursuance of the right to buy conferred by Part 5 of the Housing Act 1985 (c. 68) or in pursuance of the right to acquire on rent to mortgage terms conferred by that Part of that Act,

(e) it is a shared ownership lease, whether granted in pursuance of that Part of that Act or otherwise, where the tenant's total share is 100 per cent., or

(f) it was granted in pursuance of that Part of that Act as it has effect by virtue of section 17 of the Housing Act 1996 (c. 52) (the right to acquire).

(3) "Shared ownership lease" means a lease--

(a) granted on payment of a premium calculated by reference to a percentage of the value of the demised premises or the cost of providing them, or

(b) under which the tenant (or his personal representatives) will or may be entitled to a sum calculated by reference, directly or indirectly, to the value of those premises.

(4) "Total share", in relation to the interest of a tenant under a shared ownership lease, means his initial share plus any additional share or shares in the demised premises which he has acquired.

77 Long leases: further provisions

(1) A lease terminable by notice after a death or marriage is not a long lease if--

(a) the notice is capable of being given at any time after the death or marriage of the tenant,

(b) the length of the notice is not more than three months, and

(c) the terms of the lease preclude both its assignment otherwise than by virtue of section 92 of the Housing Act 1985 (assignments by way of exchange) and the sub-letting of the whole of the demised premises.

(2) Where the tenant of any property under a long lease, on the coming to an end of the lease, becomes or has become tenant of the property or part of it under any subsequent tenancy (whether by express grant or by implication of law), that tenancy is a long lease irrespective of its terms.

(3) A lease--

(a) granted for a term of years certain not exceeding 21 years, but with a covenant or obligation for renewal without payment of a premium (but not for perpetual renewal), and

(b) renewed on one or more occasions so as to bring to more than 21 years the total of the terms granted (including any interval between the end of a lease and the grant of a renewal),

is to be treated as if the term originally granted had been one exceeding 21 years.

(4) Where a long lease--

(a) is or was continued for any period under Part 1 of the Landlord and Tenant Act 1954 (c. 56) or under Schedule 10 to the Local Government and Housing Act 1989 (c. 42), or

(b) was continued for any period under the Leasehold Property (Temporary Provisions) Act 1951 (c. 38),

it remains a long lease during that period.

(5) Where in the case of a flat there are at any time two or more separate leases, with the same landlord and the same tenant, and--

(a) the property comprised in one of those leases consists of either the flat or a part of it (in either case with or without appurtenant property), and

(b) the property comprised in every other lease consists of either a part of the flat (with or without appurtenant property) or appurtenant property only,

there shall be taken to be a single long lease of the property comprised in such of those leases as are long leases.

Claim to acquire right

78 Notice inviting participation

(1) Before making a claim to acquire the right to manage any premises, a RTM company must give notice to each person who at the time when the notice is given--

(a) is the qualifying tenant of a flat contained in the premises, but

(b) neither is nor has agreed to become a member of the RTM company.

(2) A notice given under this section (referred to in this Chapter as a "notice of invitation to participate") must--

(a) state that the RTM company intends to acquire the right to manage the premises,

(b) state the names of the members of the RTM company,

(d) contain such other particulars (if any) as may be required to be contained in notices of invitation to participate by regulations made by the appropriate national authority.

(3) A notice of invitation to participate must also comply with such requirements (if any) about the form of notices of invitation to participate as may be prescribed by regulations so made.

(4) A notice of invitation to participate must either--

(a) be accompanied by a copy of the memorandum of association and articles of association of the RTM company, or

(b) include a statement about inspection and copying of the memorandum of association and articles of association of the RTM company.

(5) A statement under subsection (4)(b) must--

(a) specify a place (in England or Wales) at which the memorandum of association and articles of association may be inspected,

(b) specify as the times at which they may be inspected periods of at least two hours on each of at least three days (including a Saturday or Sunday or both) within the seven days beginning with the day following that on which the notice is given,

(c) specify a place (in England or Wales) at which, at any time within those seven days, a copy of the memorandum of association and articles of association may be ordered, and

(d) specify a fee for the provision of an ordered copy, not exceeding the reasonable cost of providing it.

(6) Where a notice given to a person includes a statement under subsection (4)(b), the notice is to be treated as not having been given to him if he is not allowed to undertake an inspection, or is not provided with a copy, in accordance with the statement.

(7) A notice of invitation to participate is not invalidated by any inaccuracy in any of the particulars required by or by virtue of this section.

79 Notice of claim to acquire right

(1) A claim to acquire the right to manage any premises is made by giving notice of the claim (referred to in this Chapter as a "claim notice"); and in this Chapter the "relevant date", in relation to any claim to acquire the right to manage, means the date on which notice of the claim is given.

(2) The claim notice may not be given unless each person required to be given a notice of invitation to participate has been given such a notice at least 14 days before.

(3) The claim notice must be given by a RTM company which complies with subsection (4) or (5).

(4) If on the relevant date there are only two qualifying tenants of flats contained in the premises, both must be members of the RTM company.

(5) In any other case, the membership of the RTM company must on the relevant date include a number of qualifying tenants of flats contained in the premises which is not less than one-half of the total number of flats so contained.

(6) The claim notice must be given to each person who on the relevant date 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, or

(c) a manager appointed under Part 2 of the Landlord and Tenant Act 1987 (c. 31) (referred to in this Part as "the 1987 Act") to act in relation to the premises, or any premises containing or contained in the premises.

(7) Subsection (6) does not require the claim notice to be given to a person who cannot be found or whose identity cannot be ascertained; but if this subsection means that the claim notice is not required to be given to anyone at all, section 85 applies.

(8) A copy of the claim notice must be given to each person who on the relevant date is the qualifying tenant of a flat contained in the premises.

(9) Where a manager has been appointed under Part 2 of the 1987 Act to act in relation to the premises, or any premises containing or contained in the premises, a copy of the claim notice must also be given to the leasehold valuation tribunal or court by which he was appointed.

80 Contents of claim notice

(1) The claim notice must comply with the following requirements.

(2) It must specify the premises and contain a statement of the grounds on which it is claimed that they are premises to which this Chapter applies.

(3) It must state the full name of each person who is both--

(a) the qualifying tenant of a flat contained in the premises, and

(b) a member of the RTM company,

and the address of his flat.

(4) And it must contain, in relation to each such person, such particulars of his lease as are sufficient to identify it, including--

(a) the date on which it was entered into,

(b) the term for which it was granted, and

(5) It must state the name and registered office of the RTM company.

(6) It must specify a date, not earlier than one month after the relevant date, by which each person who was given the notice under section 79(6) may respond to it by giving a counter-notice under section 84.

(7) It must specify a date, at least three months after that specified under subsection (6), on which the RTM company intends to acquire the right to manage the premises.

(8) It must also contain such other particulars (if any) as may be required to be contained in claim notices by regulations made by the appropriate national authority.

(9) And it must comply with such requirements (if any) about the form of claim notices as may be prescribed by regulations so made.

81 Claim notice: supplementary

(1) A claim notice is not invalidated by any inaccuracy in any of the particulars required by or by virtue of section 80.

(2) Where any of the members of the RTM company whose names are stated in the claim notice was not the qualifying tenant of a flat contained in the premises on the relevant date, the claim notice is not invalidated on that account, so long as a sufficient number of qualifying tenants of flats contained in the premises were members of the company on that date; and for this purpose a "sufficient number" is a number (greater than one) which is not less than one-half of the total number of flats contained in the premises on that date.

(3) Where any premises have been specified in a claim notice, no subsequent claim notice which specifies--

(a) the premises, or

(b) any premises containing or contained in the premises,

may be given so long as the earlier claim notice continues in force.

(4) Where a claim notice is given by a RTM company it continues in force from the relevant date until the right to manage is acquired by the company unless it has previously--

(a) been withdrawn or deemed to be withdrawn by virtue of any provision of this Chapter, or

(b) ceased to have effect by reason of any other provision of this Chapter.

82 Right to obtain information

(1) A company which is a RTM company in relation to any premises may give to any person a notice requiring him to provide the company with any information--

(a) which is in his possession or control, and

(b) which the company reasonably requires for ascertaining the particulars required by or by virtue of section 80 to be included in a claim notice for claiming to acquire the right to manage the premises.

(2) Where the information is recorded in a document in the person's possession or control, the RTM company may give him a notice requiring him--

(a) to permit any person authorised to act on behalf of the company at any reasonable time to inspect the document (or, if the information is recorded in the document in a form in which it is not readily intelligible, to give any such person access to it in a readily intelligible form), and

(b) to supply the company with a copy of the document containing the information in a readily intelligible form on payment of a reasonable fee.

(3) A person to whom a notice is given must comply with it within the period of 28 days beginning with the day on which it is given.

83 Right of access

(1) Where a RTM company has given a claim notice in relation to any premises, each of the persons specified in subsection (2) has a right of access to any part of the premises if that is reasonable in connection with any matter arising out of the claim to acquire the right to manage.

(2) The persons referred to in subsection (1) are--

(a) any person authorised to act on behalf of the RTM company,

(b) any person who is landlord under a lease of the whole or any part of the premises and any person authorised to act on behalf of any such person,

(c) any person who is party to such a lease otherwise than as landlord or tenant and any person authorised to act on behalf of any such person, and

(d) any manager appointed under Part 2 of the 1987 Act to act in relation to the premises, or any premises containing or contained in the premises, and any person authorised to act on behalf of any such manager.

(3) The right conferred by this section is exercisable, at any reasonable time, on giving not less than ten days' notice--

(a) to the occupier of any premises to which access is sought, or

(b) if those premises are unoccupied, to the person entitled to occupy them.

84 Counter-notices

(1) A person who is given a claim notice by a RTM company under section 79(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 80(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 agrees, or the persons by whom the counter-notices were given agree, 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.

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