Housing Act 2004

Termination of EDMOs: financial arrangements

23 (1) This paragraph applies where an interim EDMO or final EDMO ceases to have effect for any reason.

(2) If, on the termination date for an interim EDMO, the total amount of rent or other payments collected or recovered as mentioned in paragraph 5(3) exceeds the total amount of—

(a) the authority’s relevant expenditure, and

(b) any amounts of compensation payable to third parties by virtue of orders under section 134(4) or 138(2) or decisions of the authority under section 136(4) or 138(3),

the authority must, as soon as possible after the termination date, pay the balance to the relevant proprietor.

(3) If, on the termination date for a final EDMO, any balance is payable to—

(a) a third party,

(b) a dispossessed landlord or tenant, or

(c) the relevant proprietor,

in accordance with the management scheme under paragraph 13, that amount must be paid to that person by the local housing authority in the manner provided by the scheme.

(4) Sub-paragraphs (5) and (6) apply where, on the termination date for an interim EDMO or final EDMO, the total amount of rent or other payments collected or recovered as mentioned in paragraph 5(3) is less than the total amount of the authority’s relevant expenditure together with any such amounts of compensation as are mentioned in sub-paragraph (2)(b) above.

(5) The authority may recover from the relevant proprietor—

(a) the amount of any relevant expenditure (not exceeding the deficit mentioned in sub-paragraph (4)) which he has agreed in writing to pay either as a condition of revocation of the order or otherwise, and

(b) where the relevant proprietor is a tenant under a lease in respect of the dwelling, the amount of any outstanding service charges payable under the lease.

(6) In the case of an interim EDMO ceasing to have effect, the authority may recover the deficit mentioned in sub-paragraph (4) from the relevant proprietor if, in their opinion, he unreasonably refused to consent to the creation of an interest or right as mentioned in paragraph 2(3)(c) while the order was in force.

(7) The provisions of any of sub-paragraphs (2) to (6) do not, however, apply in relation to the order if—

(a) the order is followed by a final EDMO, and

(b) the management scheme contained in that final EDMO provides for those sub-paragraphs not to apply in relation to the order (see paragraph 13(4)(c) and (d)).

(8) Any sum recoverable by the authority under sub-paragraph (5) or (6) is, until recovered, a charge on the dwelling.

(9) The charge takes effect on the termination date for the order as a legal charge which is a local land charge.

(10) For the purpose of enforcing the charge the authority have the same powers and remedies under the Law of Property Act 1925 (c. 20) and otherwise as if they were mortgagees by deed having powers of sale and lease, of accepting surrenders of leases and of appointing a receiver.

(11) The power of appointing a receiver is exercisable at any time after the end of the period of one month beginning with the date on which the charge takes effect.

(12) In this paragraph—

• “dispossessed landlord or tenant” means a person who was a lessor, lessee, licensor or licensee under a lease or licence determined by an order under paragraph 22;

• “relevant expenditure” has the same meaning as in paragraph 5 (in relation to an interim EDMO) or paragraph 13 (in relation to a final EDMO);

• “service charge” has the meaning given by section 18 of the Landlord and Tenant Act 1985 (c. 70);

• “the termination date” means the date on which the order ceases to have effect.