Termination of Tenancies for Tenant Default - Law Commission

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Preliminary
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Landlord and Tenant (Termination of Tenancies) Bill
Schedule 2 — Tenant default: special cases
SCHEDULE 2 Section 2(4)
TENANT DEFAULT: SPECIAL CASES
1 This Schedule applies for the purposes of section 2.
Covenants in long leases of dwellings
2 The Commonhold and Leasehold Reform Act 2002 (c. 15) is amended as
follows.
3 In section 167 (the cross-heading above which becomes “Termination of long
leases of dwellings”), for subsection (1) substitute—
“(1) In the case of a long lease of a dwelling, a failure by a tenant to pay
an amount consisting of rent, service charges or administration
charges (or a combination of them) (“the unpaid amount”) is not to
be treated for the purposes of section 2 of the 2006 Act as a breach of
a covenant or condition of the lease unless and until the unpaid
amount—
(a) exceeds the prescribed sum, or
(b) consists of or includes an amount which has been payable for
more than a prescribed period.”.
4 (1) In section 168 (the title to which becomes “Breach of covenant other than
failure to pay rent, etc.”) for subsection (1) substitute—
“(1) A breach by a tenant of a covenant or condition of a long lease of a
dwelling is not to be treated for the purposes of section 2 of the 2006
Act as a breach by him of that covenant or condition unless and until
subsection (2) is satisfied.
(1A) This section does not apply in relation to a failure by a tenant to pay
an amount coming within section 167(1).”.
(2) In subsection (3) of that section, for “a notice may not be served by virtue of
subsection (2)(a) or (c) until” substitute “in a case within subsection (2)(a) or
(c) the default period for the purposes of section 4 or 18 of the 2006 Act does
not begin until”.
5 In section 169 (section 168: supplementary), omit subsections (6) and (7).
Payment of rent: tenancies other than long leases of dwellings
6 (1) A covenant to make a payment of rent is to be treated as breached only if—
(a) the payment is not made on or before the last payment day, and
(b) where the tenancy expressly requires a formal demand for the
payment, a formal demand for it is made.
(2) The last payment day is the last day of the period of 21 days beginning with
the day on which the payment first becomes due.
(3) But in the case of a post-commencement tenancy which specifies a different
day for the purposes of this paragraph, the last payment day is that day.
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