Leasehold Reform, Housing and Urban Development Act 1993 (c. 28)

(The document as of February, 2008)

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97 Registration of notices, applications and orders under Chapters I and II

(1) No lease shall be registrable under the [1972 c. 61.] Land Charges Act 1972 or be taken to be an estate contract within the meaning of that Act by reason of any rights or obligations of the tenant or landlord which may arise under Chapter I or II, and any right of a tenant arising from a notice given under section 13 or 42 shall not be an overriding interest within the meaning of the [1925 c. 21.] Land Registration Act 1925; but a notice given under section 13 or 42 shall be registrable under the Land Charges Act 1972, or may be the subject of a notice or caution under the Land Registration Act 1925, as if it were an estate contract.

(2) The Land Charges Act 1972 and the Land Registration Act 1925--

(a) shall apply in relation to an order made under section 26(1) or 50(1) as they apply in relation to an order affecting land which is made by the court for the purpose of enforcing a judgment or recognisance; and

(b) shall apply in relation to an application for such an order as they apply in relation to other pending land actions.

(3) The persons applying for such an order in respect of any premises shall be treated for the purposes of section 57 of the Land Registration Act 1925 (inhibitions) as persons interested in relation to any registered land containing the whole or part of those premises.

98 Power to prescribe procedure under Chapters I and II

(1) Where a claim to exercise the right to collective enfranchisement under Chapter I is made by the giving of a notice under section 13, or a claim to exercise the right to acquire a new lease under Chapter II is made by the giving of a notice under section 42, then except as otherwise provided by Chapter I or (as the case may be) Chapter II--

(a) the procedure for giving effect to the notice, and

(b) the rights and obligations of all parties in relation to the investigation of title and other matters arising in giving effect to the notice,

shall be such as may be prescribed by regulations made by the Secretary of State and, subject to or in the absence of provision made by any such regulations, shall be as nearly as may be the same as in the case of a contract of sale or leasing freely negotiated between the parties.

(2) Regulations under this section may, in particular, make provision--

(a) for a person to be discharged from performing any obligations arising out of a notice under section 13 or 42 by reason of the default or delay of some other person;

(b) for the payment of a deposit--

(i) by a nominee purchaser (within the meaning of Chapter I) on exchange of contracts, or

(ii) by a tenant who has given a notice under section 42; and

(i) the person with whom any such deposit is to be lodged and the capacity in which any such person is to hold it, and

(ii) the circumstances in which the whole or part of any such deposit is to be returned or forfeited.

99 Notices

(1) Any notice required or authorised to be given under this Part--

(a) shall be in writing; and

(b) may be sent by post.

(2) Where in accordance with Chapter I or II an address in England and Wales is specified as an address at which notices may be given to any person or persons under that Chapter--

(a) any notice required or authorised to be given to that person or those persons under that Chapter may (without prejudice to the operation of subsection (3)) be given to him or them at the address so specified; but

(b) if a new address in England and Wales is so specified in substitution for that address by the giving of a notice to that effect, any notice so required or authorised to be given may be given to him or them at that new address instead.

(3) Where a tenant is required or authorised to give any notice under Chapter I or II to a person who--

(a) is the tenant's immediate landlord, and

(b) is such a landlord in respect of premises to which Part VI of the [1987 c. 31.] Landlord and Tenant Act 1987 (information to be furnished to tenants) applies,

the tenant may, unless he has been subsequently notified by the landlord of a different address in England and Wales for the purposes of this section, give the notice to the landlord--

(i) at the address last furnished to the tenant as the landlord's address for service in accordance with section 48 of that Act (notification of address for service of notices on landlord); or

(ii) if no such address has been furnished, at the address last furnished to the tenant as the landlord's address in accordance with section 47 of that Act (landlord's name and address to be contained in demands for rent).

(4) Subsections (2) and (3) apply to notices in proceedings under Chapter I or II as they apply to notices required or authorised to be given under that Chapter.

(5) Any notice which is given under Chapter I or II by any tenants or tenant must--

(a) if it is a notice given under section 13 or 42, be signed by each of the tenants, or (as the case may be) by the tenant, by whom it is given; and

(b) in any other case, be signed by or on behalf of each of the tenants, or (as the case may be) by or on behalf of the tenant, by whom it is given.

(6) The Secretary of State may by regulations prescribe--

(a) the form of any notice required or authorised to be given under this Part; and

(b) the particulars which any such notice must contain (whether in addition to, or in substitution for, any particulars required by virtue of any provision of this Part).

100 Orders and regulations

(1) Any power of the Secretary of State to make orders or regulations under this Part--

(a) may be so exercised as to make different provision for different cases or descriptions of cases, including different provision for different areas; and

(b) includes power to make such procedural, incidental, supplementary and transitional provision as may appear to the Secretary of State necessary or expedient.

(2) Any power of the Secretary of State to make orders or regulations under this Part shall be exercisable by statutory instrument which (except in the case of regulations making only such provision as is mentioned in section 99(6)) shall be subject to annulment in pursuance of a resolution of either House of Parliament.

101 General interpretation of Part I

(1) In this Part--

"business lease" means a tenancy to which Part II of the [1954 c. 56.] Landlord and Tenant Act 1954 applies;
"common parts", in relation to any building or part of a building, includes the structure and exterior of that building or part and any common facilities within it;
"the court" (unless the context otherwise requires) means, by virtue of section 90(1), a county court;
"disposal" means a disposal whether by the creation or the transfer of an interest, and includes the surrender of a lease and the grant of an option or right of pre-emption, and "acquisition" shall be construed accordingly (as shall expressions related to either of these expressions);
"dwelling" means any building or part of a building occupied or intended to be occupied as a separate dwelling;
"flat" means a separate set of premises (whether or not on the same floor)--
(a)
which forms part of a building, and
(b)
which is constructed or adapted for use for the purposes of a dwelling, and
(c)
either the whole or a material part of which lies above or below some other part of the building;
"interest" includes estate;
"lease" and "tenancy", and related expressions, shall be construed in accordance with subsection (2);
"rent assessment committee" means a rent assessment committee constituted under Schedule 10 to the [1977 c. 42.] Rent Act 1977;
"the term date", in relation to a lease granted for a term of years certain, means (subject to subsection (6)) the date of expiry of that term, and, in relation to a tenancy to which any of the provisions of section 102 applies, shall be construed in accordance with those provisions.

(2) In this Part "lease" and "tenancy" have the same meaning, and both expressions include (where the context so permits)--

(a) a sub-lease or sub-tenancy, and

(b) an agreement for a lease or tenancy (or for a sub-lease or sub-tenancy),

but do not include a tenancy at will or at sufferance; and the expressions "landlord" and "tenant", and references to letting, to the grant of a lease or to covenants or the terms of a lease, shall be construed accordingly.

(3) In this Part any reference (however expressed) to the lease held by a qualifying tenant of a flat is a reference to a lease held by him under which the demised premises consist of or include the flat (whether with or without one or more other flats).

(4) Where two or more persons jointly constitute either the landlord or the tenant or qualifying tenant in relation to a lease of a flat, any reference in this Part to the landlord or to the tenant or qualifying tenant is (unless the context otherwise requires) a reference to both or all of the persons who jointly constitute the landlord or the tenant or qualifying tenant, as the case may require.

(5) Any reference in this Part to the date of the commencement of a lease is a reference to the date of the commencement of the term of the lease.

(6) In the case of a lease which derives (in accordance with section 7(6)) from more than one separate leases, references in this Part to the date of the commencement of the lease or to the term date shall, if the terms of the separate leases commenced at different dates or those leases have different term dates, have effect as references to the date of the commencement, or (as the case may be) to the term date, of the lease comprising the flat in question (or the earliest date of commencement or earliest term date of the leases comprising it).

(7) For the purposes of this Part property is let with other property if the properties are let either under the same lease or under leases which, in accordance with section 7(6), are treated as a single lease.

(8) For the purposes of this Part any lease which is reversionary on another lease shall be treated as if it were a concurrent lease intermediate between that other lease and any interest superior to that other lease.

(9) For the purposes of this Part an order of a court or a decision of a leasehold valuation tribunal is to be treated as becoming final--

(a) if not appealed against, on the expiry of the time for bringing an appeal; or

(b) if appealed against and not set aside in consequence of the appeal, at the time when the appeal and any further appeal is disposed of--

(i) by the determination of it and the expiry of the time for bringing a further appeal (if any), or

(ii) by its being abandoned or otherwise ceasing to have effect.

102 Term date and other matters relating to periodical tenancies

(1) Where either of the following provisions (which relate to continuation tenancies) applies to a tenancy, namely--

(a) section 19(2) of the [1954 c. 56.] Landlord and Tenant Act 1954 ("the 1954 Act"), or

(b) paragraph 16(2) of Schedule 10 to the [1989 c. 42.] Local Government and Housing Act 1989 ("the 1989 Act"),

the tenancy shall be treated for the relevant purposes of this Part as granted to expire--

(i) on the date which is the term date for the purposes of the 1954 Act (namely, the first date after the commencement of the 1954 Act on which, apart from the 1954 Act, the tenancy could have been brought to an end by a notice to quit given by the landlord under the tenancy), or

(ii) on the date which is the term date for the purposes of Schedule 10 to the 1989 Act (namely, the first date after the commencement of Schedule 10 to the 1989 Act on which, apart from that Schedule, the tenancy could have been brought to an end by such a notice to quit),

as the case may be.

(2) Subject to subsection (1), where under section 7(3) a tenancy created or arising as a tenancy from year to year or other periodical tenancy is to be treated as a long lease, then for the relevant purposes of this Part, the term date of that tenancy shall be taken to be the date (if any) on which the tenancy is to terminate by virtue of a notice to quit given by the landlord under the tenancy before the relevant date for those purposes, or else the earliest date on which it could as at that date (in accordance with its terms and apart from any enactment) be brought to an end by such a notice to quit.

(3) Subject to subsection (1), in the case of a tenancy granted to continue as a periodical tenancy after the expiry of a term of years certain, or to continue as a periodical tenancy if not terminated at the expiry of such a term, any question whether the tenancy is at any time to be treated for the relevant purposes of this Part as a long lease, and (if so) with what term date, shall be determined as it would be if there had been two tenancies, as follows--

(a) one granted to expire at the earliest time (at or after the expiry of that term of years certain) at which the tenancy could (in accordance with its terms and apart from any enactment) be brought to an end by a notice to quit given by the landlord under the tenancy; and

(b) the other granted to commence at the expiry of the first (and not being one to which subsection (1) applies).

(4) In this section "the relevant purposes of this Part" means the purposes of Chapter I or, to the extent that section 7 has effect for the purposes of Chapter II in accordance with section 39(3), the purposes of that Chapter.

103 Application of Part I to Isles of Scilly

This Part applies to the Isles of Scilly subject to such exceptions, adaptations and modifications as the Secretary of State may by order direct.

Part II Public Sector Housing

Chapter I England and Wales

Right to buy

104 Landlord's notice of purchase price and other matters

For subsection (5) of section 125 (landlord's notice of purchase price and other matters) of the [1985 c. 68.] Housing Act 1985 (in this Chapter referred to as "the 1985 Act") there shall be substituted the following subsection--

" (5) The notice shall also inform the tenant of--

(a) the effect of sections 125D and 125E(1) and (4) (tenant's notice of intention, landlord's notice in default and effect of failure to comply),

(b) his right under section 128 to have the value of the dwelling-house at the relevant time determined or re-determined by the district valuer,

(d) the effect of sections 140 and 141(1), (2) and (4) (landlord's notices to complete and effect of failure to comply),

(e) the effect of the provisions of this Part relating to the right to acquire on rent to mortgage terms, and

(f) the relevant amount and multipliers for the time being declared by the Secretary of State for the purposes of section 143B. "

105 Tenant's notice of intention etc

(1) After section 125C of the 1985 Act there shall be inserted the following sections--

" 125D Tenant's notice of intention

(1) Where a notice under section 125 has been served on a secure tenant, he shall within the period specified in subsection (2) either--

(a) serve a written notice on the landlord stating either that he intends to pursue his claim to exercise the right to buy or that he withdraws that claim, or

(b) serve a notice under section 144 claiming to exercise the right to acquire on rent to mortgage terms.

(2) The period for serving a notice under subsection (1) is the period of twelve weeks beginning with whichever of the following is the later--

(a) the service of the notice under section 125, and

(b) where the tenant exercises his right to have the value of the dwelling-house determined or re-determined by the district valuer, the service of the notice under section 128(5) stating the effect of the determination or re-determination.

125E Landlord's notice in default

(1) The landlord may, at any time after the end of the period specified in section 125D(2) or, as the case may require, section 136(2), serve on the tenant a written notice--

(a) requiring him, if he has failed to serve the notice required by section 125D(1), to serve that notice within 28 days, and

(b) informing him of the effect of this subsection and subsection (4).

(2) At any time before the end of the period mentioned in subsection (1)(a) (or that period as previously extended) the landlord may by written notice served on the tenant extend it (or further extend it).

(3) If at any time before the end of that period (or that period as extended under subsection (2)) the circumstances are such that it would not be reasonable to expect the tenant to comply with a notice under this section, that period (or that period as so extended) shall by virtue of this subsection be extended (or further extended) until 28 days after the time when those circumstances no longer obtain.

(4) If the tenant does not comply with a notice under this section, the notice claiming to exercise the right to buy shall be deemed to be withdrawn at the end of that period (or, as the case may require, that period as extended under subsection (2) or (3)). "

(2) For subsections (2) to (5) of section 136 of the 1985 Act (change of tenant after notice claiming to exercise the right to buy) there shall be substituted the following subsection--

" (2) If a notice under section 125 (landlord's notice of purchase price and other matters) has been served on the former tenant, then, whether or not the former tenant has served a notice under subsection (1) of section 125D (tenant's notice of intention), the new tenant shall serve a notice under that subsection within the period of twelve weeks beginning with whichever of the following is the later--

(a) his becoming the secure tenant, and

(b) where the right to have the value of the dwelling-house determined or re-determined by the district valuer is or has been exercised by him or the former tenant, the service of the notice under section 128(5) stating the effect of the determination or re-determination. "

106 Exceptions to the right to buy

(1) In paragraph 10(1) (groups of dwelling-houses for persons of pensionable age) of Schedule 5 to the 1985 Act (exceptions to the right to buy)--

(a) for the words "persons of pensionable age", in the first place where they occur, there shall be substituted the words "elderly persons"; and

(b) for those words, in the second place where they occur, there shall be substituted the words "persons aged 60 or more".

(2) For paragraph 11 (individual dwelling-houses for persons of pensionable age) of that Schedule there shall be substituted the following paragraph--

" 11 (1) The right to buy does not arise if the dwelling-house--

(a) is particularly suitable, having regard to its location, size, design, heating system and other features, for occupation by elderly persons, and

(b) was let to the tenant or a predecessor in title of his for occupation by a person who was aged 60 or more (whether the tenant or predecessor or another person).

(2) In determining whether a dwelling is particularly suitable, no regard shall be had to the presence of any feature provided by the tenant or a predecessor in title of his.

(3) Notwithstanding anything in section 181 (jurisdiction of county court), any question arising under this paragraph shall be determined as follows.

(4) If an application for the purpose is made by the tenant to the Secretary of State before the end of the period of 56 days beginning with the service of the landlord's notice under section 124, the question shall be determined by the Secretary of State.

(5) If no such application is so made, the question shall be deemed to have been determined in favour of the landlord.

(6) This paragraph does not apply unless the dwelling-house concerned was first let before 1st January 1990. "

(3) Subsections (1) and (2) do not apply in any case where the tenant's notice claiming to exercise the right to buy was served before the day on which this section comes into force.

(4) For the purposes of subsection (3), no account shall be taken of any steps taken under section 177 of the 1985 Act (amendment or withdrawal and re-service of notice to correct mistakes).

Abolition of certain ancillary rights

107 Abolition of right to a mortgage, right to defer completion and right to be granted a shared ownership lease

The following rights ancillary to the right to buy are hereby abolished, namely--

(a) the right to a mortgage conferred by sections 132 to 135 of the 1985 Act;

(b) the right to defer completion conferred by section 142 of that Act; and

Right to acquire on rent to mortgage terms

108 Right to acquire on rent to mortgage terms

For section 143 of the 1985 Act there shall be substituted the following sections--

" Right to acquire on rent to mortgage terms

143 Right to acquire on rent to mortgage terms

(1) Subject to subsection (2) and sections 143A and 143B, where--

(a) a secure tenant has claimed to exercise the right to buy, and

(b) his right to buy has been established and his notice claiming to exercise it remains in force,

he also has the right to acquire on rent to mortgage terms in accordance with the following provisions of this Part.

(2) The right to acquire on rent to mortgage terms cannot be exercised if the exercise of the right to buy is precluded by section 121 (circumstances in which right to buy cannot be exercised).

(3) Where the right to buy belongs to two or more persons jointly, the right to acquire on rent to mortgage terms also belongs to them jointly.

143A Right excluded by entitlement to housing benefit

(1) The right to acquire on rent to mortgage terms cannot be exercised if--

(a) it has been determined that the tenant is or was entitled to housing benefit in respect of any part of the relevant period, or

(b) a claim for housing benefit in respect of any part of that period has been made (or is treated as having been made) by or on behalf of the tenant and has not been determined or withdrawn.

(2) In this section "the relevant period" means the period--

(a) beginning twelve months before the day on which the tenant claims to exercise the right to acquire on rent to mortgage terms, and

(b) ending with the day on which the conveyance or grant is executed in pursuance of that right.

143B Right excluded if minimum initial payment exceeds maximum initial payment

(1) The right to acquire on rent to mortgage terms cannot be exercised if the minimum initial payment in respect of the dwelling-house exceeds the maximum initial payment in respect of it.

(2) The maximum initial payment in respect of a dwelling-house is 80 per cent. of the price which would be payable if the tenant were exercising the right to buy.

(3) Where, in the case of a dwelling-house which is a house, the weekly rent at the relevant time did not exceed the relevant amount, the minimum initial payment shall be determined by the formula--

P = R × M

where--

P = the minimum initial payment;
R = the amount of the weekly rent at the relevant time;
M = the multiplier which at that time was for the time being declared by the Secretary of State for the purposes of this subsection.

(4) Where, in the case of a dwelling-house which is a house, the weekly rent at the relevant time exceeded the relevant amount, the minimum initial payment shall be determined by the formula--

---

where--

P = the minimum initial payment;
Q = the qualifying maximum for the year of assessment which included the relevant time;
E = the amount by which the weekly rent at that time exceeded the relevant amount;
M = the multiplier which at that time was for the time being declared by the Secretary of State for the purposes of this subsection.

(5) The minimum initial payment in respect of a dwelling-house which is a flat is 80 per cent. of the amount which would be the minimum initial payment in respect of the dwelling-house if it were a house.

(6) The relevant amount and multipliers for the time being declared for the purposes of this section shall be such that, in the case of a dwelling-house which is a house, they will produce a minimum initial payment equal to the capital sum which, in the opinion of the Secretary of State, could be raised on a 25 year repayment mortgage in the case of which the net amount of the monthly mortgage payments was equal to the rent at the relevant time calculated on a monthly basis.

(7) For the purposes of subsection (6) the Secretary of State shall assume--

(a) that the interest rate applicable throughout the 25 year term were the standard national rate for the time being declared by the Secretary of State under paragraph 2 of Schedule 16 (local authority mortgage interest rates); and

(b) that the monthly mortgage payments represented payments of capital and interest only.

(8) In this section--

"net amount", in relation to monthly mortgage payments, means the amount of such payments after deduction of tax under section 369 of the [1988 c. 1.] Income and Corporation Taxes Act 1988 (mortgage interest payable under deduction of tax);
"qualifying maximum" means the qualifying maximum defined in section 367(5) of that Act (limit on relief for interest on certain loans);
"relevant amount" means the amount which at the relevant time was for the time being declared by the Secretary of State for the purposes of this section;
"relevant time" means the time of the service of the landlord's notice under section 146 (landlord's notice admitting or denying right);
"rent" means rent payable under the secure tenancy, but excluding any element which is expressed to be payable for services, repairs, maintenance or insurance or the landlord's costs of management. "

109 Tenant's notice claiming right

For sections 144 and 145 of the 1985 Act there shall be substituted the following section--

" 144 Tenant's notice claiming right

(1) A secure tenant claims to exercise the right to acquire on rent to mortgage terms by written notice to that effect served on the landlord.

(2) The notice may be withdrawn at any time by notice in writing served on the landlord.

(3) On the service of a notice under this section, any notice served by the landlord under section 140 or 141 (landlord's notices to complete purchase in pursuance of right to buy) shall be deemed to have been withdrawn; and no such notice may be served by the landlord whilst a notice under this section remains in force.

(4) Where a notice under this section is withdrawn, the tenant may complete the transaction in accordance with the provisions of this Part relating to the right to buy. "

110 Landlord's notice admitting or denying right

For section 146 of the 1985 Act there shall be substituted the following section--

" 146 Landlord's notice admitting or denying right

(1) Where a notice under section 144 (notice claiming to exercise the right to acquire on rent to mortgage terms) has been served by the tenant, the landlord shall, unless the notice is withdrawn, serve on the tenant as soon as practicable a written notice either--

(a) admitting the tenant's right and informing him of the matters mentioned in subsection (2), or

(b) denying it and stating the reasons why, in the opinion of the landlord, the tenant does not have the right to acquire on rent to mortgage terms.

(2) The matters are--

(a) the relevant amount and multipliers for the time being declared by the Secretary of State for the purposes of section 143B;

(b) the amount of the minimum initial payment;

(d) the landlord's share on the assumption that the tenant makes the minimum initial payment;

(e) the amount of the initial discount on that assumption; and

(f) the provisions which, in the landlord's opinion, should be contained in the conveyance or grant and the mortgage required by section 151B (mortgage for securing redemption of landlord's share). "

111 Tenant's notice of intention etc

After section 146 of the 1985 Act there shall be inserted the following sections--

" 146A Tenant's notice of intention

(1) Where a notice under section 146 has been served on a secure tenant, he shall within the period specified in subsection (2) serve a written notice on the landlord stating either--

(a) that he intends to pursue his claim to exercise the right to acquire on rent to mortgage terms and the amount of the initial payment which he proposes to make, or

(b) that he withdraws that claim and intends to pursue his claim to exercise the right to buy, or

(2) The period for serving a notice under subsection (1) is the period of twelve weeks beginning with the service of the notice under section 146.

(3) The amount stated in a notice under subsection (1)(a)--

(a) shall not be less than the minimum initial payment and not more than the maximum initial payment, and

(b) may be varied at any time by notice in writing served on the landlord.

146B Landlord's notice in default

(1) The landlord may, at any time after the end of the period specified in section 146A(2), serve on the tenant a written notice--

(a) requiring him, if he has failed to serve the notice required by section 146A(1), to serve that notice within 28 days, and

(b) informing him of the effect of this subsection and subsection (4).

(4) If the tenant does not comply with a notice under this section the notice claiming to exercise the right to acquire on rent to mortgage terms shall be deemed to be withdrawn at the end of that period (or, as the case may require, that period as extended under subsection (2) or (3)). "

112 Notice of landlord's share and initial discount

For section 147 of the 1985 Act there shall be substituted the following section--

" 147 Notice of landlord's share and initial discount

(1) Where a secure tenant has served--

(a) a notice under section 146A(1)(a) stating that he intends to pursue his claim to exercise the right to acquire on rent to mortgage terms, and the amount of the initial payment which he proposes to make, or

(b) a notice under section 146A(3)(b) varying the amount stated in a notice under section 146A(1)(a),

the landlord shall, as soon as practicable, serve on the tenant a written notice complying with this section.

(2) The notice shall state--

(a) the landlord's share on the assumption that the amount of the tenant's initial payment is that stated in the notice under section 146A(1)(a) or, as the case may be, section 146A(3)(b), and

(b) the amount of the initial discount on that assumption,

determined in each case in accordance with section 148. "

113 Determination of landlord's share, initial discount etc

For section 148 of the 1985 Act there shall be substituted the following section--

" 148 Determination of landlord's share, initial discount etc

The landlord's share shall be determined by the formula--

---

the amount of the initial discount shall be determined by the formula--

---

and the amount of any previous discount which will be recovered by virtue of the transaction shall be determined by the formula--

---

where--

S = the landlord's share expressed as a percentage;
P = the price which would be payable if the tenant were exercising the right to buy;
IP = the amount of the tenant's initial payment (but disregarding any reduction in pursuance of section 153B(3));
ID = the amount of the initial discount;
D = the amount of the discount which would be applicable if the tenant were exercising the right to buy;
RD = the amount of any previous discount which will be recovered by virtue of the transaction;
PD = the amount of any previous discount which would be recovered if the tenant were exercising the right to buy. "

114 Change of landlord after notice claiming right

For section 149 of the 1985 Act there shall be substituted the following section--

" 149 Change of landlord after notice claiming right

(1) Where the interest of the landlord in the dwelling-house passes from the landlord to another body after a secure tenant has given a notice claiming to exercise the right to acquire on rent to mortgage terms, all parties shall subject to subsection (2) be in the same position as if the other body--

(a) had become the landlord before the notice was given, and

(b) had been given that notice and any further notice given by the tenant to the landlord, and

(2) If the circumstances after the disposal differ in any material respect, as for example where--

(a) the interest of the disponee in the dwelling-house after the disposal differs from that of the disponor before the disposal, or

(b) any of the provisions of Schedule 5 (exceptions to the right to buy) becomes or ceases to be applicable,

all those concerned shall, as soon as practicable after the disposal, take all such steps (whether by way of amending or withdrawing and re-serving any notice or extending any period or otherwise) as may be requisite for the purpose of securing that all parties are, as nearly as may be, in the same position as they would have been if those circumstances had obtained before the disposal. "

115 Duty of landlord to convey freehold or grant lease

For section 150 of the 1985 Act there shall be substituted the following section--

" 150 Duty of landlord to convey freehold or grant lease

(1) Where a secure tenant has claimed to exercise the right to acquire on rent to mortgage terms and that right has been established, then, as soon as all matters relating to the grant and to securing the redemption of the landlord's share have been agreed or determined, the landlord shall make to the tenant--

(a) if the dwelling-house is a house and the landlord owns the freehold, a grant of the dwelling-house for an estate in fee simple absolute, or

(b) if the landlord does not own the freehold or if the dwelling-house is a flat (whether or not the landlord owns the freehold), a grant of a lease of the dwelling-house,

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