Legislation – Leasehold and Freehold Reform Act 2024

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Introduction

Part 1
Leasehold houses

1 Ban on grant or assignment of certain long residential leases of houses

2 Long residential leases of houses

3 Leases which have a long term

4 Series of leases whose term would extend beyond 21 years

5 Houses

6 Residential leases

7 Permitted leases

8 Permitted leases: certification by the appropriate tribunal

9 Permitted leases: marketing restrictions

10 Permitted leases: transaction warning conditions

11 Prescribed statements in new long leases

12 Restriction on title

13 Redress: right to acquire a freehold or superior leasehold estate

14 Redress: application of the right to acquire

15 Redress: general provision

16 Redress regulations: exercising and giving effect to the right to acquire

17 Enforcement by trading standards authorities

18 Financial penalties

19 Financial penalties: cross-border enforcement

20 Lead enforcement authority

21 General duties of lead enforcement authority

22 Enforcement by lead enforcement authority

23 Further powers and duties of enforcement authorities

24 Part 1: Crown application

25 Power to amend: permitted leases and definitions

26 Interpretation of Part 1

Part 2
Leasehold enfranchisement and extension

27 Removal of qualifying period before enfranchisement and extension claims

28 Removal of restrictions on repeated enfranchisement and extension claims

29 Change of non-residential limit on collective enfranchisement claims

30 Eligibility for enfranchisement and extension: specific cases

31 Acquisition of intermediate interests in collective enfranchisement

32 Right to require leaseback by freeholder after collective enfranchisement

33 Longer lease extensions

34 Lease extensions under the LRA 1967 on payment of premium at peppercorn rent

35 LRA 1967: determining price payable for freehold or lease extension

36 LRHUDA 1993: determining price payable for collective enfranchisement or new lease

37 Enfranchisement or extension: new method for calculating price payable

38 Costs of enfranchisement and extension under the LRA 1967

39 Costs of enfranchisement and extension under the LRHUDA 1993

40 Replacement of sections 20 and 21 of the LRA 1967

41 References to “the court” in Part 1 of the LRA 1967

42 Amendment of Part 1 of the LRHUDA 1993

43 References to “the court” in Part 1 of the LRHUDA 1993

44 No first-instance applications to the High Court in tribunal matters

45 Miscellaneous amendments

46 LRA 1967: preservation of existing law for certain enfranchisements

47 Part 2: consequential amendments to other legislation

Part 3
Other rights of long leaseholders

48 Right to vary long lease to replace rent with peppercorn rent

49 Change of non-residential limit on right to manage claims

50 Costs of right to manage claims

51 Compliance with obligations arising under Chapter 1 of Part 2 of the CLRA 2002

52 No first-instance applications to the High Court in tribunal matters

Part 4
Regulation of leasehold

53 Extension of regulation to fixed service charges

54 Notice of future service charge demands

55 Service charge demands

56 Accounts and annual reports

57 Right to obtain information on request

58 Enforcement of duties relating to service charges

59 Limitation on ability of landlord to charge insurance costs

60 Duty to provide information about insurance to tenants

61 Duty of landlords to publish administration charge schedules

62 Limits on rights of landlords to claim litigation costs from tenants

63 Right of tenants to claim litigation costs from landlords

64 Restriction on recovery of non-litigation costs of enfranchisement, extension and right to manage

65 Appointment of manager: power to vary or discharge orders

66 Appointment of manager: breach of redress scheme requirements

67 Leasehold sales information requests

68 Regulations under the LTA 1985: procedure and appropriate authority

69 LTA 1985: Crown application

70 Part 4: consequential amendments

71 Application of Part 4 to existing leases

Part 5
Regulation of estate management

72 Meaning of “estate management” etc

73 Estate management charges: general limitations

74 Limitation of estate management charges: reasonableness

75 Limitation of estate management charges: consultation requirements

76 Limitation of estate management charges: time limits

77 Determination of tribunal as to estate management charges

78 Demands for payment

79 Annual reports

80 Right to request information

81 Requests under section 80: further provision

82 Enforcement of sections 78 to 81

83 Meaning of “administration charge”

84 Duty of estate managers to publish administration charge schedules

85 Enforcement of section 84

86 Limitation of administration charges

87 Determination of tribunal as to administration charges

88 Codes of management practice: extension to estate managers

89 Notices of complaint

90 Appointment of substitute manager

91 Conditions for applying for appointment order

92 Criteria for determining whether to make appointment order

93 Appointment orders: further provision

94 Estate management: sales information requests

95 Effect of sales information request

96 Charges for provision of information

97 Enforcement of sections 95 and 96

98 Part 5: Crown application

99 Interpretation of Part 5

Part 6
Leasehold and estate management: redress schemes

100 Leasehold and estate management: redress schemes

101 Redress schemes: voluntary jurisdiction

102 Financial assistance for establishment or maintenance of redress schemes

103 Approval and designation of redress schemes

104 Redress schemes: no Crown status

105 Financial penalties

106 Financial penalties: maximum amounts

107 Decision under a redress scheme may be made enforceable as if it were a court order

108 Lead enforcement authority: further provision

109 Guidance for enforcement authorities and scheme administrators

110 Part 6: amendments to other Acts

111 Interpretation of Part 6

Part 7
Rentcharges

112 Meaning of “estate rentcharge”

113 Regulation of remedies for arrears of rentcharges

Part 8
Amendments of Part 5 of the Building Safety Act 2022

114 Steps relating to remediation of defects

115 Remediation orders

116 Remediation contribution orders

117 Recovery of legal costs etc through service charge

118 Repeal of section 125 of the BSA 2022

119 Higher-risk and relevant buildings: notifications in connection with insolvency

Part 9
General

120 Interpretation of references to other Acts

121 Power to make consequential provision

122 Regulations

123 Extent

124 Commencement

125 Short title

SCHEDULES

Schedule 1 Categories of permitted lease

Schedule 2 Leasehold houses: financial penalties

Schedule 3 Eligibility for enfranchisement and extension: specific cases

Schedule 4 Determining and sharing the market value

Schedule 5 Other compensation

Schedule 6 Schedules 4 and 5: interpretation

Schedule 7 Amendments consequential on sections 35 to 37 and Schedules 4 to 6

Schedule 8 Leasehold enfranchisement and extension: miscellaneous amendments

Schedule 9 Part 2: consequential amendments to other legislation

Schedule 10 Right to vary lease to replace rent with peppercorn rent

Schedule 11 Part 4: consequential amendments

Schedule 12 Redress schemes: financial penalties

Schedule 13 Part 6: amendments to other Acts

Part 2Leasehold enfranchisement and extension

Jurisdiction of the county court and tribunals

42Amendment of Part 1 of the LRHUDA 1993

(1)

The LRHUDA 1993 is amended as follows.

(2)

After section 27 insert—

“27APower relating to completion of Chapter 1 claims

(1)

This section applies where—

(a)

the completion of a conveyance has not taken place in accordance with the terms of a binding contract entered into in pursuance of an initial notice because—

(i)

a party to the transaction has failed to execute the conveyance, or

(ii)

the nominee purchaser has failed to pay the price and other sums payable or due under the contract, and

(b)

that failure is in breach of an obligation arising under the contract.

(2)

Where this section applies, the appropriate tribunal may, on the application of the nominee purchaser or the reversioner, make an order—

(a)

appointing a person to execute the conveyance on behalf of a party to the transaction;

(b)

requiring the nominee purchaser to pay the price and other sums payable or due under the contract into the tribunal or to a person specified in the order.

(3)

A conveyance executed on behalf of a party in consequence of an order under this section has the same force and effect (for all purposes) as if it had been executed by that party.

(4)

This section does not prevent a party to a transaction seeking other remedies in connection with a breach of an obligation.”

(3)

In section 48 (applications where terms in dispute or failure to enter into new lease)—

(a)

after subsection (3) insert—

“(3A)

An order under subsection (3) may—

(a)

appoint a person to execute the new lease on behalf of a party to the transaction;

(b)

require that the price and other sums payable are paid into the tribunal or to a person specified in the order.

A lease executed on behalf of a party to a transaction in consequence of an order under subsection (3) has the same force and effect (for all purposes) as if it had been executed by that party.”;

(b)

in subsection (4), for “Any such order” substitute “An order under subsection (3)”.

(4)

In section 49 (applications where landlord fails to give counter-notice or further counter-notice)—

(a)

after subsection (4) insert—

“(4A)

An order under subsection (4) may—

(a)

appoint a person to execute the new lease on behalf of a party to the transaction;

(b)

require that the price and other sums payable are paid into the tribunal or to a person specified in the order.

A lease executed on behalf of a party to a transaction in consequence of an order under subsection (4) has the same force and effect (for all purposes) as if it had been executed by that party.”;

(b)

in subsection (5), for “Any such order” substitute “An order under subsection (4)”.

(5)

In section 90 (jurisdiction of county courts)—

(a)

omit subsection (2);

(b)

in subsection (3), for “or (2)” substitute “or section 91A;

(c)

omit subsection (4).

(6)

For section 91 (jurisdiction of tribunals) substitute—

“91Jurisdiction of tribunals

(1)

Any question arising in relation to any of the following matters is, in default of agreement, to be determined by the appropriate tribunal—

(a)

the terms of acquisition relating to—

(i)

any interest which is to be acquired by a nominee purchaser in pursuance of Chapter 1, or

(ii)

any new lease which is to be granted to a tenant in pursuance of Chapter 2,

including in particular any matter which needs to be determined in accordance with section 37 of, or Schedule 4 to, the Leasehold and Freehold Reform Act 2024;

(b)

the terms of any lease which is to be granted in accordance with section 36 and Schedule 9;

(c)

the amount of any payment falling to be made by virtue of section 18(2);

(d)

the amount of any compensation payable under section 37A or 61A;

(e)

the amount of any costs payable by virtue of any provision of Chapter 1 or 2;

(f)

the apportionment between two or more persons of any amount (whether of costs or otherwise) payable by virtue of any such provision;

(g)

whether (and what) costs are payable under any of sections 89B to 89F;

(h)

the terms on which a lease is to be severed under paragraph 7 of Schedule A1;

(i)

any matter arising under paragraph 12 of Schedule 11 (reduction of rent under intermediate leases on grant of a new lease), including what rent under an intermediate lease is apportioned to the flat;

(j)

whether a person is entitled to be paid a share of the market value, and what share of the market value a person is entitled to be paid, in accordance with Part 6 of Schedule 4 to the Leasehold and Freehold Reform Act 2024;

(k)

any matter arising under Schedule 10 to the Leasehold and Freehold Reform Act 2024 (variation of lease to reduce rent to peppercorn).

(2)

Where in connection with—

(a)

any exercise of the right to collective enfranchisement under Chapter 1, or

(b)

any acquisition of a new lease under Chapter 2,

it is necessary to apportion the rent payable under a tenancy (whether immediate, superior or reversionary), the apportionment must be made by the appropriate tribunal.

(3)

The appropriate tribunal may, when determining the property in which any interest is to be acquired in pursuance of a notice under section 13 or 42, specify in its determination property which is less extensive than that specified in that notice.

(4)

Where the appropriate tribunal has determined the amount of compensation payable under section 37A or 61A, it may make an order requiring the tenant concerned to pay that amount to the person entitled to it.

(5)

Where the appropriate tribunal has determined the amount of any costs payable by virtue of any provision of Chapter 1 or 2 or that costs are payable under any of sections 89B to 89F, it may make an order requiring a person to pay those costs.

(6)

In relation to paragraph 12 of Schedule 11—

(a)

if the landlord under a qualifying intermediate lease cannot be found or their identity cannot be ascertained, the appropriate tribunal may make such order as it thinks fit, including—

(i)

an order dispensing with the requirement to give notice under paragraph 12(3) of Schedule 11 to that landlord, or

(ii)

an order that such a notice has effect and has been properly served even though it has not been served on that landlord;

(b)

the appropriate tribunal may make an order appointing a person to vary a lease in accordance with paragraph 12 of Schedule 11 on behalf of the landlord or tenant;

(c)

if the appropriate tribunal makes a determination that a notice under paragraph 12(3) of Schedule 11 was of no effect, it may—

(i)

determine whether another landlord or tenant could have given such a notice, and

(ii)

if it determines that they could have done so, order that paragraph 12 of Schedule 11 is to apply as if they had done so.

(7)

The variation of a lease on behalf of a party in consequence of an order under subsection (6)(b) has the same force and effect (for all purposes) as if it had been executed by that party.

(8)

In this section—

nominee purchaser” has the same meaning as in Chapter 1;

terms of acquisition” is to be construed in accordance with section 24(8) or section 48(7), as appropriate.

(9)

For the purposes of this Chapter “appropriate tribunal” means—

(a)

in relation to property in England, the First-tier Tribunal or, where determined by or under Tribunal Procedure Rules, the Upper Tribunal;

(b)

in relation to property in Wales, a leasehold valuation tribunal.

(10)

See section 44 of the Leasehold and Freehold Reform Act 2024, which restricts the first-instance jurisdiction of the High Court in respect of tribunal matters.

91AJurisdiction for other proceedings

(1)

This section applies to proceedings—

(a)

in relation to any matter arising under or by virtue of Chapter 1 or 2 or this Chapter, and

(b)

for which jurisdiction has not otherwise been conferred under or by virtue of this Act.

(2)

Jurisdiction is conferred on the appropriate tribunal for proceedings to which this section applies.

(3)

But jurisdiction is instead conferred on the court where a purpose of the proceedings is to obtain a remedy that could not be granted by the appropriate tribunal but could be granted by the court.

(4)

If, in proceedings before the court to which this section applies, it appears to the court that—

(a)

the remedy (or remedies) sought could be granted by the appropriate tribunal, it must by order transfer the proceedings to the appropriate tribunal;

(b)

a remedy sought could be granted by the appropriate tribunal and another remedy sought could only be granted by the court, it may by order transfer the proceedings to the appropriate tribunal insofar as the proceedings relate to the remedy that could be granted by the appropriate tribunal.

(5)

Following a transfer of proceedings under subsection (4)(b)—

(a)

the court may dispose of all or any remaining proceedings pending the determination of the transferred proceedings by the appropriate tribunal,

(b)

the appropriate tribunal may determine the transferred proceedings, and

(c)

when the appropriate tribunal has done so, the court may give effect to the determination in an order of the court.

(6)

Rules of court may prescribe the procedure to be followed in a court in connection with or in consequence of a transfer under this section.

(7)

A reference in Chapter 1 or 2 or this Chapter to the jurisdiction conferred on the appropriate tribunal or the court includes that conferred by this section.”

(7)

In section 92 (enforcement of obligations under Chapters 1 and 2)—

(a)

in the heading, for “Enforcement of” substitute “Power to order compliance with”;

(b)

in subsection (1), after “The court” insert “or appropriate tribunal”;

(c)

after subsection (2) insert—

“(3)

An application may not be made under subsection (1) to the court unless the application relates to proceedings in respect of which the court has jurisdiction under or by virtue of any provision of Chapter 1, 2 or 7 (including section 91A).

(4)

Where an order other than an order to pay a sum of money has been made under subsection (1) by the appropriate tribunal—

(a)

a person may apply to the court for enforcement of the order;

(b)

the appropriate tribunal may by order transfer proceedings to the court for enforcement of the order,

and the order is to be enforceable by the court in the same way as an order of the court.

(5)

See section 176C of the Commonhold and Leasehold Reform Act 2002 for general provision about the enforcement of tribunal decisions and section 27 of the Tribunals, Courts and Enforcement Act 2007 for provision about the enforcement of an order to pay a sum of money.”.