Termination of Tenancies for Tenant Default - Law Commission

91. Subsection (4) mitigates the effect of clause 12(7) (whereby all interests
derived from the tenant come to an end with the tenancy) which would otherwise
apply as a result of the new tenancy order having effect as a termination order.
92. Clause 16(3) is subject to section 27 of the Land Registration Act 2002.
Where a new tenancy order is made and the new tenancy is a registrable
disposition within the meaning of that section, it will be a disposition by operation
of law. The applicant will not hold the legal title to the new tenancy until title to the
interest has been registered with HM Land Registry.
Clause 17: Joint tenancy adjustment order
93. Clause 10(9) provides that a joint tenancy adjustment order is an order that,
where two or more persons constitute the tenant (or a person with a qualifying
interest), one or more is to constitute the tenant (or person with a qualifying
interest) from the day specified in the order. Clause 17 therefore only applies
where the tenancy or qualifying interest (for example, a sub-tenancy) is held
jointly.
94. As a result of clause 11(2), a joint tenancy adjustment order can be made
only on an application by one of the persons concerned.
95. The effect of a joint tenancy adjustment order will be to release a joint
tenant from future liability under the covenants of the tenancy. Subsections (2)
and (3) therefore limit the liability of an outgoing joint tenant by providing that any
covenant to which he or she is subject after the adjustment is unenforceable
against him or her.
96. The issue of enforceability will arise only where there is privity of contract
under an “old” tenancy for the purposes of the Landlord and Tenant (Covenants)
Act 1995 or where the assignor of the tenancy enters into an authorised
guarantee agreement under that Act.
97. Were it not for subsection (4), it might be contended that, since the identity
of the tenant is changing, the adjustment is in substance an assignment. A joint
tenancy adjustment is more closely analogous to survivorship (the change in
ownership which occurs when one of a number of joint tenants dies).
Nevertheless, section 11 of the Landlord and Tenant (Covenants) Act 1995
categorises that change of ownership as an assignment by operation of law and
therefore an excluded assignment for the purposes of that Act.
98. Provision to the effect that a joint tenancy adjustment was not an excluded
assignment would suggest that it might be an assignment for other purposes (for
example, liability to pay stamp duty land tax). Subsection (4) forestalls any such
argument.
Clause 18: Summary termination notice
99. This clause sets out what a landlord must do to use the summary
termination procedure.
100. Subsection (2) lists the persons who must be given a summary termination
notice and imposes a duty on the landlord to deliver such a notice to the demised
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