Termination of Tenancies for Tenant Default - Law Commission

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24 200 Landlord and Tenant (Termination of Tenancies) Bill Schedule 4 — Covenants to put or keep premises in repair (b) an order of a court, or (c) a requirement of an authority under an enactment. (4) The third condition is that— (a) the tenant is not in occupation of the whole of the demised premises, and (b) immediate action to remedy the default is necessary in the interests of the occupier of the whole or part of the premises. (5) The fourth condition is that the costs involved in taking action to remedy the default are likely to increase significantly if the action is not taken immediately. (6) The fifth condition is that the court thinks that there are special circumstances which make it just and equitable to make an order under section 9. SCHEDULE 5 Section 21(8) INSOLVENCY 1 The Insolvency Act 1986 (c. 45) is amended as follows. 2 (1) In section 130 (winding-up order), in subsection (2), after “property,” insert “and no landlord or other person to whom rent is payable may give or deliver a summary termination notice in respect of premises let to the company,”. (2) In subsection (3) of that section, after “any debt of the company,” insert “and no landlord or other person to whom rent is payable may give or deliver a summary termination notice in respect of premises let to the company,”. 3 In section 252 (individual voluntary arrangement: moratorium while interim order has effect), in subsection 2(aa), for the words from “exercise” to “such premises” substitute “give or deliver a summary termination notice in respect of premises let to the debtor”. 4 In section 254 (application for interim order), in subsection (1)(a), for the words from “exercise” to “such premises” substitute “give or deliver a summary termination notice in respect of premises let to the debtor”. 5 In section 260 (approval of individual voluntary arrangement), at the end add— “(6) No landlord or other person to whom rent is payable may give or deliver a summary termination notice in respect of premises let to the debtor except with the leave of the court.”. 6 (1) In section 285 (restriction on bankruptcy proceedings), after subsection (1) insert— “(1A) At any time when proceedings on a bankruptcy petition are pending, no landlord or other person to whom rent is payable may give or deliver a summary termination notice in respect of premises let to the debtor except with the leave of the court.” 5 10 15 20 25 30 35 40
Landlord and Tenant (Termination of Tenancies) Bill Schedule 5 — Insolvency (2) In subsection (3)(b) of that section, after “against the bankrupt” insert “, or give or deliver a summary termination notice in respect of premises let to the bankrupt,”. 7 In Part 18 (interpretation), after section 436A, insert— “436B Summary termination procedure A reference in this Act to giving or delivering a summary termination notice in respect of premises— (a) is to giving or delivering a summary termination notice in respect of those premises on the ground of a tenant default, and (b) is accordingly to be read with the Landlord and Tenant (Termination of Tenancies) Act 2006.”. 8 In paragraph 12 of Schedule A1 (moratorium during company voluntary arrangement), in paragraph (f), for the words from “exercise” to “such premises” substitute “give or deliver a summary termination notice in respect of premises let to the company”. 9 In paragraph 43 of Schedule B1 (moratorium during administration), in subparagraph (4), for “exercise a right of forfeiture by peaceable re-entry in relation to” substitute “give or deliver a summary termination notice in respect of”. Deserted Tenements Act 1817 (c. 52) SCHEDULE 6 Section 34(1) MISCELLANEOUS AMENDMENTS 1 The reference in the Deserted Tenements Act 1817 to the case in which no right or power of re-entry is reserved or given to the landlord on the ground of non-payment of rent is to be read as a reference to the case in which he is not entitled to give or deliver a summary termination notice on that ground. Common Law Procedure Act 1852 (c. 76) 2 Sections 210 to 212, 214 and 218 of the Common Law Procedure Act 1852 (ejectment of tenant for non-payment of rent, etc.) cease to have effect. Allotments Act 1922 (c. 51) 3 (1) In section 1 of the Allotments Act 1922 (determination of tenancy of allotment garden), in subsection (1)(e), omit the words from “for nonpayment” to “tenancy or”. (2) At the end of that section add— “(5) Nothing in this section prevents the termination under the Landlord and Tenant (Termination of Tenancies) Act 2006 of a tenancy coming within subsection (1).”. 201 25 5 10 15 20 25 30 35
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The Law Commission (LAW COM No 303)
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THE LAW COMMISSION TERMINATION OF T
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Consultation 40 Reform recommendati
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Consultation 68 Reform recommendati
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(7) Any other matter 102 THE LEASEH
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Restrictions on using the summary t
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where appropriate using the various
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etains an equitable jurisdiction to
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of the law”. A number of leading
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procedure, the tenancy will not ter
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Part 6 examines the position of tho
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2.7 When a tenancy is terminated un
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unless valid notices have been give
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Transfer order 2.30 Only a qualifyi
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2.41 Where a landlord serves a summ
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PART 3 TENANT DEFAULT INTRODUCTION
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scheme by characterising the obliga
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to include such clauses and to allo
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perform their obligations under the
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SPECIAL CASES OF TENANT DEFAULT Den
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Assignment 3.51 Most tenancies cont
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the incoming tenant of the assigned
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often stipulate that a right to for
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insolvency process having the same
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3.93 In addition, section 81 of the
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1996 and Chapter 5 of the Commonhol
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covenant is non-payment of rent, a
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Reform recommendations 3.132 We rec
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The CP’s provisional proposals 4.
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do so by delaying until the default
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it is unlikely that a tenant would
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(4) give the date by which action m
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Specify the time for remedial actio
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(3) must specify in respect of the
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agreement (subject to a maximum ext
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underlying principle that qualifyin
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all tenancies granted for seven or
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4.92 As we intend to retain the sam
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PART 5 MAKING A TERMINATION CLAIM (
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e set off against the cost of carry
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future liabilities under the terms
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(6) where a tenancy comes to an end
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5.43 During the period of the stay,
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described. During the consultation
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termination of a tenancy under the
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5.69 We recommend that the proceeds
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5.75 The First Report therefore rec
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making any order under the scheme t
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5.93 The CP provisionally proposed
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of the parties. 78 Proportionality
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past conduct of the parties. This m
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(7) Any other matter 5.127 It would
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PART 6 QUALIFYING INTERESTS INTRODU
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1925 extends to lessees, under-less
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according to the lease without any
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interchangeably by the courts, by s
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entitled to use the scheme to prote
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(2) if not in occupation, a right w
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property. The simplest means of ens
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(1) What should the landlord be exp
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claim with the court for service on
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have to apply for relief, which, if
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qualified covenant not to assign th
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that it is both appropriate and pro
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order unless the person who holds t
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CP suggested, close down any potent
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PART 7 SUMMARY TERMINATION PROCEDUR
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action rather than by physical re-e
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Paper was published. 22 It proposed
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7.28 It was hoped that this recomme
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equirement for service of a notice
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7.51 The final restriction was: It
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in the sub-tenant being removed fro
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termination claim, the summary term
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7.71 The summary termination proced
Page 152 and 153: Repairing covenants 7.79 The repair
Page 154 and 155: 7.88 We do not wish to discourage t
Page 156 and 157: dispensation power will only be exe
Page 158 and 159: to costs under the summary terminat
Page 160 and 161: 7.112 We recommend that: specifying
Page 162 and 163: PART 8 LIST OF RECOMMENDATIONS PART
Page 164 and 165: 8.13 We recommend that the Insolven
Page 166 and 167: (a) the day after the deadline spec
Page 168 and 169: (6) if the court dismisses an appli
Page 170 and 171: 8.39 We recommend that, where a ten
Page 172 and 173: 8.49 We recommend that: (1) where t
Page 174 and 175: (4) the default is a breach of cove
Page 176 and 177: APPENDIX A DRAFT LANDLORD AND TENAN
Page 178 and 179: ii Interpretation, etc. 28 Meaning
Page 180 and 181: 2 178 Landlord and Tenant (Terminat
Page 182 and 183: 4 180 Landlord and Tenant (Terminat
Page 184 and 185: 6 (8) This section is subject to se
Page 186 and 187: 8 13 Remedial order 184 Landlord an
Page 188 and 189: 10 186 Landlord and Tenant (Termina
Page 194 and 195: 16 30 Meaning of “qualifying inte
Page 198 and 199: 20 Preliminary 196 Landlord and Ten
Page 200 and 201: 22 Proper address 198 Landlord and
Page 204 and 205: 26 Settled Land Act 1925 (c. 18) 4
Page 210 and 211: 32 Protection from Eviction Act 197
Page 212 and 213: 34 Landlord and Tenant Act 1985 (c.
Page 216 and 217: 38 (2) After that subsection, inser
Page 218 and 219: 40 Settled Land Act 1925 (c. 18)—
Page 220 and 221: APPENDIX B EXPLANATORY NOTES TO THE
Page 222 and 223: landlord assigns the reversion, he
Page 224 and 225: 33. For example, if a tenant defaul
Page 226 and 227: 53. Subsection (5), although broadl
Page 228 and 229: If the court is satisfied of this,
Page 230 and 231: 91. Subsection (4) mitigates the ef
Page 232 and 233: 108. Under the current law, forfeit
Page 234 and 235: 126. Subsection (2) applies where t
Page 236 and 237: 145. Subsection (1)(d) includes wit
Page 238 and 239: unless he or she obtains a court or
Page 240 and 241: person who is the tenant as a resul
Page 242 and 243: termination notice (except where th
Page 244: Robin Sinclair, Solicitor Slaughter
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