Landlord and Tenant (Covenants) Act 1995

Publication Date:January 01, 1995
 
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Landlord and Tenant(Covenants) Act 1995

1995 CHAPTER 30

An Act to make provision for persons bound by covenants of a tenancy to be released from such covenants on the assignment of the tenancy, and to make other provision with respect to rights and liabilities arising under such covenants; to restrict in certain circumstances the operation of rights of re-entry, forfeiture and disclaimer; and for connected purposes.

[19th July 1995]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Preliminary

Preliminary

S-1 Tenancies to which the Act applies.

1 Tenancies to which the Act applies.

(1) Sections 3 to 16 and 21 apply only to new tenancies.

(2) Sections 17 to 20 apply to both new and other tenancies.

(3) For the purposes of this section a tenancy is a new tenancy if it is granted on or after the date on which this Act comes into force otherwise than in pursuance of—

(a) an agreement entered into before that date, or

(b) an order of a court made before that date.

(4) Subsection (3) has effect subject to section 20(1) in the case of overriding leases granted under section 19.

(5) Without prejudice to the generality of subsection (3), that subsection applies to the grant of a tenancy where by virtue of any variation of a tenancy there is a deemed surrender and regrant as it applies to any other grant of a tenancy.

(6) Where a tenancy granted on or after the date on which this Act comes into force is so granted in pursuance of an option granted before that date, the tenancy shall be regarded for the purposes of subsection (3) as granted in pursuance of an agreement entered into before that date (and accordingly is not a new tenancy), whether or not the option was exercised before that date.

(7) In subsection (6) ‘option’ includes right of first refusal.

S-2 Covenants to which the Act applies.

2 Covenants to which the Act applies.

(1) This Act applies to a landlord covenant or a tenant covenant of a tenancy—

(a) whether or not the covenant has reference to the subject matter of the tenancy, and

(b) whether the covenant is express, implied or imposed by law

but does not apply to a covenant falling within subsection (2).

(2) Nothing in this Act affects any covenant imposed in pursuance of—

(a) section 35 or 155 of the Housing Act 1985 (covenants for repayment of discount on early disposals)

(b) paragraph 1 of Schedule 6A to that Act (covenants requiring redemption of landlord's share); or

(c) paragraph 1 or 3 of Schedule 2 to the Housing Associations Act 1985 (covenants for repayment of discount on early disposals or for restricting disposals).

Transmission of covenants

Transmission of covenants

S-3 Transmission of benefit and burden of covenants.

3 Transmission of benefit and burden of covenants.

(1) The benefit and burden of all landlord and tenant covenants of a tenancy—

(a) shall be annexed and incident to the whole, and to each and every part, of the premises demised by the tenancy and of the reversion in them, and

(b) shall in accordance with this section pass on an assignment of the whole or any part of those premises or of the reversion in them.

(2) Where the assignment is by the tenant under the tenancy, then as from the assignment the assignee—

(a) becomes bound by the tenant covenants of the tenancy except to the extent that—

(i) immediately before the assignment they did not bind the assignor, or

(ii) they fall to be complied with in relation to any demised premises not comprised in the assignment; and

(b) becomes entitled to the benefit of the landlord covenants of the tenancy except to the extent that they fall to be complied with in relation to any such premises.

(3) Where the assignment is by the landlord under the tenancy, then as from the assignment the assignee—

(a) becomes bound by the landlord covenants of the tenancy except to the extent that—

(i) immediately before the assignment they did not bind the assignor, or

(ii) they fall to be complied with in relation to any demised premises not comprised in the assignment; and

(b) becomes entitled to the benefit of the tenant covenants of the tenancy except to the extent that they fall to be complied with in relation to any such premises.

(4) In determining for the purposes of subsection (2) or (3) whether any covenant bound the assignor immediately before the assignment, any waiver or release of the covenant which (in whatever terms) is expressed to be personal to the assignor shall be disregarded.

(5) Any landlord or tenant covenant of a tenancy which is restrictive of the user of land shall, as well as being capable of enforcement against an assignee, be capable of being enforced against any other person who is the owner or occupier of any demised premises to which the covenant relates, even though there is no express provision in the tenancy to that effect.

(6) Nothing in this section shall operate—

(a) in the case of a covenant which (in whatever terms) is expressed to be personal to any person, to make the covenant enforceable by or (as the case may be) against any other person; or

(b) to make a covenant enforceable against any person if, apart from this section, it would not be enforceable against him by reason of its not having been registered under the Land Registration Act 1925 or the Land Charges Act 1972 .

(7) To the extent that there remains in force any rule of law by virtue of which the burden of a covenant whose subject matter is not in existence at the time when it is made does not run with the land affected unless the covenantor covenants on behalf of himself and his assigns, that rule of law is hereby abolished in relation to tenancies.

S-4 Transmission of rights of re-entry.

4 Transmission of rights of re-entry.

4. The benefit of a landlord's right of re-entry under a tenancy—

(a) shall be annexed and incident to the whole, and to each and every part, of the reversion in the premises demised by the tenancy, and

(b) shall pass on an assignment of the whole or any part of the reversion in those premises.

Release of covenants on assignment

Release of covenants on assignment

S-5 Tenant released from covenants on assignment of tenancy.

5 Tenant released from covenants on assignment of tenancy.

(1) This section applies where a tenant assigns premises demised to him under a tenancy.

(2) If the tenant assigns the whole of the premises demised to him, he—

(a) is released from the tenant covenants of the tenancy, and

(b) ceases to be entitled to the benefit of the landlord covenants of the tenancy

as from the assignment.

(3) If the tenant assigns part only of the premises demised to him, then as from the assignment he—

(a) is released from the tenant covenants of the tenancy, and

(b) ceases to be entitled to the benefit of the landlord covenants of the tenancy,

only to the extent that those covenants fall to be complied with in relation to that part of the demised premises.

(4) This section applies as mentioned in subsection (1) whether or not the tenant is tenant of the whole of the premises comprised in the tenancy.

S-6 Landlord may be released from covenants on assignment of reversion.

6 Landlord may be released from covenants on assignment of reversion.

(1) This section applies where a landlord assigns the reversion in premises of which he is the landlord under a tenancy.

(2) If the landlord assigns the reversion in the whole of the premises of which he is the landlord—

(a) he may apply to be released from the landlord covenants of the tenancy in accordance with section 8; and

(b) if he is so released from all of those covenants, he ceases to be entitled to the benefit of the tenant covenants of the tenancy as from the assignment.

(3) If the landlord assigns the reversion in part only of the premises of which he is the landlord—

(a) he may apply to be so released from the landlord covenants of the tenancy to the extent that they fall to be complied with in relation to that part of those premises; and

(b) if he is, to that extent, so released from all of those covenants, then as from the assignment he ceases to be entitled to the benefit of the tenant covenants only to the extent that they fall to be complied with in relation to that part of those premises.

(4) This section applies as mentioned in subsection (1) whether or not the landlord is landlord of the whole of the premises comprised in the tenancy.

S-7 Former landlord may be released from covenants on assignment of reversion.

7 Former landlord may be released from covenants on assignment of reversion.

(1) This section applies where—

(a) a landlord assigns the reversion in premises of which he is the landlord under a tenancy, and

(b) immediately before the assignment a former landlord of the premises remains bound by a landlord covenant of the tenancy (‘the relevant covenant’).

(2) If immediately before the assignment the former landlord does not remain the landlord of any other premises demised by the tenancy, he may apply to be released from the relevant covenant in accordance with section 8.

(3) In any other case the former landlord may apply to be so released from the relevant covenant to the extent that it falls to be complied with in relation to any premises comprised in the assignment.

(4) If the former landlord is so released from every landlord covenant by which he remained bound immediately before the assignment, he ceases to be entitled to the benefit of the tenant covenants of the tenancy.

(5) If the former landlord is so released from every such landlord covenant to the extent that it...

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