S156 Housing Act 1985 Assignment

On By In 1

Provisions affecting future disposalsE+W

155 Repayment of discount on early disposal.E+W

(1)A conveyance of the freehold or grant of a lease in pursuance of this Part shall contain (unless, in the case of a conveyance or grant in pursuance of the right to buy, there is no discount) a covenant binding on the secure tenant and his successors in title to the following effect.

[F1( 2 )In the case of a conveyance or grant in pursuance of the right to buy, the covenant shall be to pay the landlord such sum (if any) as the landlord may demand in accordance with section 155A on the occasion of the first relevant disposal (other than an exempted disposal) which takes place within the period of five years beginning with the conveyance or grant.

( 3 )In the case of a conveyance or grant in pursuance of the right to acquire on rent to mortgage terms, the covenant shall be to pay the landlord such sum (if any) as the landlord may demand in accordance with section 155B on the occasion of the first relevant disposal (other than an exempted disposal) which takes place within the period of five years beginning with the making of the initial payment.]

[F2(3A)Where a secure tenant has served on his landlord an operative notice of delay, as defined in section 153A,—

(a)the [F3five years] referred to in subsection (2) shall begin from a date which precedes the date of the conveyance of the freehold or grant of the lease by a period equal to the time (or, if there is more than one such notice, the aggregate of the times) during which, by virtue of section 153B, any payment of rent falls to be taken into account in accordance with subsection (3) of that section; and

[F4(b)any reference in subsection (3) (other than paragraph (a) thereof) to the making of the initial payment shall be construed as a reference to the date which precedes that payment by the period referred to in paragraph (a) of this subsection.]]

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

Modifications etc. (not altering text)

[F5155AAmount of discount which may be demanded by landlord: right to buyE+W

(1)For the purposes of the covenant mentioned in section 155(2), the landlord may demand such sum as he considers appropriate, up to and including the maximum amount specified in this section.

(2)The maximum amount which may be demanded by the landlord is a percentage of the price or premium paid for the first relevant disposal which is equal to the discount to which the secure tenant was entitled, where the discount is expressed as a percentage of the value which under section 127 was taken as the value of the dwelling-house at the relevant time.

(3)But for each complete year which has elapsed after the conveyance or grant and before the disposal the maximum amount which may be demanded by the landlord is reduced by one-fifth.

(4)This section is subject to section 155C.

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

155BAmount of discount which may be demanded by landlord: right to acquire on rent to mortgage termsE+W

(1)For the purposes of the covenant mentioned in section 155(3), the landlord may demand such sum as he considers appropriate, up to and including the maximum amount specified in this section.

(2)The maximum amount which may be demanded by the landlord is the discount (if any) to which the tenant was entitled on the making of—

(a)the initial payment,

(b)any interim payment made before the disposal, or

(c)the final payment if so made,

reduced, in each case, by one-fifth for each complete year which has elapsed after the making of the initial payment and before the disposal.]

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

[F6155CIncrease attributable to home improvementsE+W

(1)In calculating the maximum amount which may be demanded by the landlord under section 155A, such amount (if any) of the price or premium paid for the disposal which is attributable to improvements made to the dwelling-house—

(a)by the person by whom the disposal is, or is to be, made, and

(b)after the conveyance or grant and before the disposal,

shall be disregarded.

(2)The amount to be disregarded under this section shall be such amount as may be agreed between the parties or determined by the district valuer.

(3)The district valuer shall not be required by virtue of this section to make a determination for the purposes of this section unless—

(a)it is reasonably practicable for him to do so; and

(b)his reasonable costs in making the determination are paid by the person by whom the disposal is, or is to be, made.

(4)If the district valuer does not make a determination for the purposes of this section (and in default of an agreement), no amount is required to be disregarded under this section.]

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

156 Liability to repay is a charge on the premises.E+W

(1)The liability that may arise under the covenant required by section 155 is a charge on the dwelling-house, taking effect as if it had been created by deed expressed to be by way of legal mortgage.

[F7(2)Subject to subsections (2A) and (2B), the charge has priority as follows—

(a)if it secures the liability that may arise under the covenant required by section 155(2), immediately after any legal charge securing an amount advanced to the secure tenant by an approved lending institution for the purpose of enabling him to exercise the right to buy;

(b)if it secures the liability that may arise under the covenant required by section 155(3), immediately after the mortgage—

(i)which is required by section 151B (mortgage for securing redemption of landlord’s share), and

(ii)which, by virtue of subsection (2) of that section, has priority immediately after any legal charge securing an amount advanced to the secure tenant by an approved lending institution for the purpose of enabling him to exercise the right to acquire on rent to mortgage terms.

(2A)The following, namely—

(a)any advance which is made otherwise than for the purpose mentioned in paragraph (a) or (b) of subsection (2) and is secured by a legal charge having priority to the charge taking effect by virtue of this section, and

(b)any further advance which is so secured,

shall rank in priority to that charge if, and only if, the landlord by written notice served on the institution concerned gives its consent; and the landlord shall so give its consent if the purpose of the advance or further advance is an approved purpose.

(2B)The landlord may at any time by written notice served on an approved lending institution postpone the charge taking effect by virtue of this section to any advance or further advance which—

(a)is made to the tenant by that institution, and

(b)is secured by a legal charge not having priority to that charge;

and the landlord shall serve such a notice if the purpose of the advance or further advance is an approved purpose.]

(3)F8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F9(3A)The covenant required by section 155 (covenant for repayment of discount) does not, by virtue of its binding successors in title of the tenant, bind a person exercising rights under a charge having priority over the charge taking effect by virtue of this section, or a person deriving title under him; and a provision of the conveyance or grant, or of a collateral agreement is void in so far as it purports to authorise a forfeiture, or to impose a penalty or disability, in the event of any such person failing to comply with that covenant.]

(4)The approved lending institutions for the purposes of this section are—

the [F10Relevant Authority],

[F11(4ZA)In subsection (4) “the Relevant Authority” does not include the Regulator of Social Housing but does include the Homes and Communities Agency.]

[F12(4ZB)In subsection (4) “the Relevant Authority” also includes the Greater London Authority.]

  • [F13an authorised deposit taker

  • an authorised insurer]

  • [F14 an authorised mortgage lender.]F15. . ..

[F16(4A)The approved purposes for the purposes of this section are—

(a)to enable the tenant to make an interim or final payment,

(b)to enable the tenant to defray, or to defray on his behalf, any of the following—

(i)the cost of any works to the dwelling-house,

(ii)any service charge payable in respect of the dwelling-house for works, whether or not to the dwelling-house, and

(iii)any service charge or other amount payable in respect of the dwelling-house for insurance, whether or not of the dwelling-house, and

(c)to enable the tenant to discharge, or to discharge on his behalf, any of the following—

(i)so much as is still outstanding of any advance or further advance which ranks in priority to the charge taking effect by virtue of this section,

(ii)any arrears of interest on such an advance or further advance, and

(iii)any costs and expenses incurred in enforcing payment of any such interest, or repayment (in whole or in part) of any such advance or further advance.

(4B)Where different parts of an advance or further advance are made for different purposes, each of those parts shall be regarded as a separate advance or further advance for the purposes of this section.]

(5)F17. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)F17. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

Modifications etc. (not altering text)

[F18156A Right of first refusal for landlord etc.E+W

(1)A conveyance of the freehold or grant of a lease in pursuance of this Part shall contain the following covenant, which shall be binding on the secure tenant and his successors in title.

This is subject to subsection (8).

(2)The covenant shall be to the effect that, until the end of the period of ten years beginning with the conveyance or grant, there will be no relevant disposal which is not an exempted disposal, unless the prescribed conditions have been satisfied in relation to that or a previous such disposal.

(3) In subsection (2) “ the prescribed conditions ” means such conditions as are prescribed by regulations under this section at the time when the conveyance or grant is made.

(4)The Secretary of State may by regulations prescribe such conditions as he considers appropriate for and in connection with conferring on—

(a) a landlord who has conveyed a freehold or granted a lease to a person (“ the former tenant ”) in pursuance of this Part, or

(b)such other person as is determined in accordance with the regulations,

a right of first refusal to have a disposal within subsection (5) made to him for such consideration as is mentioned in section 158.

(5)The disposals within this subsection are—

(a)a reconveyance or conveyance of the dwelling-house; and

(b)a surrender or assignment of the lease.

(6)Regulations under this section may, in particular, make provision—

(a)for the former tenant to offer to make such a disposal to such person or persons as may be prescribed;

(b)for a prescribed recipient of such an offer to be able either to accept the offer or to nominate some other person as the person by whom the offer may be accepted;

(c)for the person who may be so nominated to be either a person of a prescribed description or a person whom the prescribed recipient considers, having regard to any prescribed matters, to be a more appropriate person to accept the offer;

(d)for a prescribed recipient making such a nomination to give a notification of the nomination to the person nominated, the former tenant and any other prescribed person;

(e)for authorising a nominated person to accept the offer and for determining which acceptance is to be effective where the offer is accepted by more than one person;

(f)for the period within which the offer may be accepted or within which any other prescribed step is to be, or may be, taken;

(g)for the circumstances in which the right of first refusal lapses (whether following the service of a notice to complete or otherwise) with the result that the former tenant is able to make a disposal on the open market;

(h)for the manner in which any offer, acceptance or notification is to be communicated.

(7)In subsection (6) any reference to the former tenant is a reference to the former tenant or his successor in title.

Nothing in that subsection affects the generality of subsection (4).

(8)In a case to which section 157(1) applies—

(a)the conveyance or grant may contain a covenant such as is mentioned in subsections (1) and (2) above instead of a covenant such as is mentioned in section 157(1), but

(b)it may do so only if the Secretary of State or, where the conveyance or grant is executed by a housing association within section 6A(3) or (4), the Relevant Authority consents.

(9)Consent may be given in relation to—

(a)a particular disposal, or

(b)disposals by a particular landlord or disposals by landlords generally,

and may, in any case, be given subject to conditions.

(10)Regulations under this section—

(a)may make different provision with respect to different cases or descriptions of case; and

(b)shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(11)The limitation imposed by a covenant within subsection (2) (whether the covenant is imposed in pursuance of subsection (1) or (8)) is a local land charge.

(12)The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant.]

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

157 Restriction on disposal of dwelling-houses in National Parks, etc.E+W

(1)Where in pursuance of this Part a conveyance or grant is executed by a local authority F19. . . or a housing association (“the landlord”) of a dwelling-house situated in—

(a)a National Park,

(b)an area designated under [F20section 82 of the Countryside and Rights of Way Act 2000] as an area of outstanding natural beauty, or

(c)an area designated by order of the Secretary of State as a rural area,

the conveyance or grant may [F21(subject to section 156A(8)] contain a covenant limiting the freedom of the tenant (including any successor in title of his and any person deriving title under him or such a successor) to dispose of the dwelling-house in the manner specified below.

(2)The limitation is, F22. . . ), that until such time (if any) as may be notified in writing by the landlord to the tenant or a successor in title of his

[F23(a)], there will be no relevant disposal which is not an exempted disposal without the written consent of the landlord; but that consent shall not be withheld if the disposal is to a person satisfying the condition stated in subsection (3) [F24and—

(b)there will be no disposal by way of tenancy or licence without the written consent of the landlord unless the disposal is to a person satisfying that condition or by a person whose only or principal home is and, throughout the duration of the tenancy or licence, remains the dwelling-house].

(3)The condition is that the person to whom the disposal is made (or, if it is made to more than one person, at least one of them) has, thoughout the period of three years immediately preceding the application for consent [F25or, in the case of a disposal by way of tenancy or licence, preceding the disposal]—

(a)had his place of work in a region designated by order of the Secretary of State which, or part of which, is comprised in the National Park or area, or

(b)had his only or principal home in such a region;

or has had the one in part or parts of that period and the other in the remainder; but the region need not have been the same throughout the period.

(4)F26. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)F27. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)A disposal in breach of such a covenant as is mentioned in subsection (1) is void [F28and, so far as it relates to disposals by way of tenancy or licence, such a covenant may be enforced by the landlord as if—

(a)the landlord were possessed of land adjacent to the house concerned; and

(b)the covenant were expressed to be made for the benefit of such adjacent land].

[F29(6A)Any reference in the preceding provisions of this section to a disposal by way of tenancy or licence does not include a reference to a relevant disposal or an exempted disposal.]

(7)Where such a covenant imposes the limitation specified in subsection (2), the limitation is a local land charge and the Chief Land Registrar shall enter [F30a restriction in the register of title reflecting the limitation].

(8)An order under this section—

(a)may make different provision with respect to different cases or descriptions of case, including different provision for different areas, and

(b)shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

[F1156A Right of first refusal for landlord etc.E+W

(1)A conveyance of the freehold or grant of a lease in pursuance of this Part shall contain the following covenant, which shall be binding on the secure tenant and his successors in title.

This is subject to subsection (8).

(2)The covenant shall be to the effect that, until the end of the period of ten years beginning with the conveyance or grant, there will be no relevant disposal which is not an exempted disposal, unless the prescribed conditions have been satisfied in relation to that or a previous such disposal.

(3) In subsection (2) “ the prescribed conditions ” means such conditions as are prescribed by regulations under this section at the time when the conveyance or grant is made.

(4)The Secretary of State may by regulations prescribe such conditions as he considers appropriate for and in connection with conferring on—

(a) a landlord who has conveyed a freehold or granted a lease to a person (“ the former tenant ”) in pursuance of this Part, or

(b)such other person as is determined in accordance with the regulations,

a right of first refusal to have a disposal within subsection (5) made to him for such consideration as is mentioned in section 158.

(5)The disposals within this subsection are—

(a)a reconveyance or conveyance of the dwelling-house; and

(b)a surrender or assignment of the lease.

(6)Regulations under this section may, in particular, make provision—

(a)for the former tenant to offer to make such a disposal to such person or persons as may be prescribed;

(b)for a prescribed recipient of such an offer to be able either to accept the offer or to nominate some other person as the person by whom the offer may be accepted;

(c)for the person who may be so nominated to be either a person of a prescribed description or a person whom the prescribed recipient considers, having regard to any prescribed matters, to be a more appropriate person to accept the offer;

(d)for a prescribed recipient making such a nomination to give a notification of the nomination to the person nominated, the former tenant and any other prescribed person;

(e)for authorising a nominated person to accept the offer and for determining which acceptance is to be effective where the offer is accepted by more than one person;

(f)for the period within which the offer may be accepted or within which any other prescribed step is to be, or may be, taken;

(g)for the circumstances in which the right of first refusal lapses (whether following the service of a notice to complete or otherwise) with the result that the former tenant is able to make a disposal on the open market;

(h)for the manner in which any offer, acceptance or notification is to be communicated.

(7)In subsection (6) any reference to the former tenant is a reference to the former tenant or his successor in title.

Nothing in that subsection affects the generality of subsection (4).

(8)In a case to which section 157(1) applies—

(a)the conveyance or grant may contain a covenant such as is mentioned in subsections (1) and (2) above instead of a covenant such as is mentioned in section 157(1), but

(b)it may do so only if the Secretary of State or, where the conveyance or grant is executed by a housing association within section 6A(3) or (4), the Relevant Authority consents.

(9)Consent may be given in relation to—

(a)a particular disposal, or

(b)disposals by a particular landlord or disposals by landlords generally,

and may, in any case, be given subject to conditions.

(10)Regulations under this section—

(a)may make different provision with respect to different cases or descriptions of case; and

(b)shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(11)The limitation imposed by a covenant within subsection (2) (whether the covenant is imposed in pursuance of subsection (1) or (8)) is a local land charge.

(12)The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant.]

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Amendments (Textual)

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