14(1)Where—E+W
(a)the value of [F1a] freeholder’s interest in the specified premises (as determined [F1for the relevant purposes]), or
(b)the value of any intermediate leasehold interest (as determined [F2for the relevant purposes]),
is a negative amount, the value of the interest for [F3those] purposes shall be nil.
(2)Where sub-paragraph (1) applies to any intermediate leasehold ainterest whose value is a negative amount (“the negative interest”), then for the relevant purposes any interests in the specified premises superior to the negative interest and having a positive value shall be reduced in value—
(a)beginning with the interest which is immediately superior to the negative interest and continuing (if necessary) with any such other superior interests in order of proximity to the negative interest;
(b)until the aggregate amount of the reduction is equal to the negative amount in question; and
(c)without reducing the value of any interest to less than nil.
(3)In a case where sub-paragraph (1) applies to two or more intermediate leasehold interests whose values are negative amounts, sub-paragraph (2) shall apply separately in relation to each of those interests—
(a)beginning with the interest which is inferior to every other of those interests and then in order of proximity to that interest; and
(b)with any reduction in the value of any interest for the relevant purposes by virtue of any prior application of sub-paragraph (2) being taken into account.
F4[(3A)Where sub-paragraph (2) applies—
(a)for the purposes of paragraph 5A(2)(a), and
(b)in relation to an intermediate leasehold interest in relation to which there is more than one immediately superior interest,
any reduction in value made under that sub-paragraph shall be apportioned between the immediately superior interests.]
(4)For the purposes of sub-paragraph (2) an interest has a positive value if (apart from that sub-paragraph) its value for the relevant purposes is a positive amount.
(5)In this Part of this Schedule “the relevant purposes”—
(a)as respects [F5a] freeholder’s interest in the specified premises, means the purposes of paragraph 2(1)(a) [F6or, as the case may be, 5A(2)(a)]; and
(b)as respects any intermediate leasehold interest, means the purposes of paragraph 6(1)(b)(i).
Textual Amendments
F1Words in Sch. 6 para. 14(1)(a) substituted (1.10.1996) by 1996 c. 52, s. 107, Sch. 10 para. 18(10)(a); S.I. 1996/2212, art. 2(2) (with saving in Sch.)
F2Words in Sch. 6 para. 14(1)(b) substituted (1.10.1996) by 1996 c. 52, s. 107, Sch. 10 para. 18(10)(b); S.I. 1996/2212, art. 2(2) (with saving in Sch.)
F3Words in Sch. 6 para. 14(1) substituted (1.10.1996) by 1996 c. 52, s. 107, Sch. 10 para. 18(10)(c); S.I. 1996/2212, art. 2(2) (with saving in Sch.)
F4Sch. 6 para. 14(3A) inserted (1.10.1996) by 1996 c. 52, s. 107, Sch. 10 para. 18(11); S.I. 1996/2212, art. 2(2) (with saving in Sch.)
F5Words in Sch. 6 para. 14(5)(a) substituted (1.10.1996) by 1996 c. 52, s. 107, Sch. 10 para. 18(12)(a); S.I. 1996/2212, art. 2(2) (with saving in Sch.)
F6Words in Sch. 6 para. 14(5)(a) inserted (1.10.1996) by 1996 c. 52, s. 107, Sch. 10 para. 18(12)(b); S.I. 1996/2212, art. 2(2) (with saving in Sch.)