Leasehold Reform, Housing and Urban Development Act 1993

19 Effect of initial notice as respects subsequent transactions by freeholder etc

(1) Where the initial notice has been registered in accordance with section 97(1), then so long as it continues in force—

(a) the person who owns the freehold of the specified premises shall not—

(i) make any disposal severing his interest in those premises or in any property specified in the notice under section 13(3)(a)(ii), or

(ii) grant out of that interest any lease under which, if it had been granted before the relevant date, the interest of the tenant would to any extent have been liable on that date to acquisition by virtue of section 2(1)(a) or (b); and

(b) no other relevant landlord shall grant out of his interest in the specified premises or in any property so specified any such lease as is mentioned in paragraph (a)(ii);

and any transaction shall be void to the extent that it purports to effect any such disposal or any such grant of a lease as is mentioned in paragraph (a) or (b).

(2) Where the initial notice has been so registered and at any time when it continues in force—

(a) the person who owns the freehold of the specified premises disposes of his interest in those premises or in any property specified in the notice under section 13(3)(a)(ii), or

(b) any other relevant landlord disposes of any interest of his specified in the notice under section 13(3)(c)(i),

subsection (3) below shall apply in relation to that disposal.

(3) Where this subsection applies in relation to any such disposal as is mentioned in subsection (2)(a) or (b), all parties shall for the purposes of this Chapter be in the same position as if the person acquiring the interest under the disposal—

(a) had become its owner before the initial notice was given (and was accordingly a relevant landlord in place of the person making the disposal), and

(b) had been given any notice or copy of a notice given under this Chapter to that person, and

(c) had taken all steps which that person had taken;

and, if any subsequent disposal of that interest takes place at any time when the initial notice continues in force, this subsection shall apply in relation to that disposal as if any reference to the person making the disposal included any predecessor in title of his.

(4) Where immediately before the relevant date there is in force a binding contract relating to the disposal to any extent—

(a) by the person who owns the freehold of the specified premises, or

(b) by any other relevant landlord,

of any interest of his falling within subsection (2)(a) or (b), then, so long as the initial notice continues in force, the operation of the contract shall be suspended so far as it relates to any such disposal.

(5) Where—

(a) the operation of a contract has been suspended under subsection (4) (“the suspended contract”), and

(b) a binding contract is entered into in pursuance of the initial notice,

then (without prejudice to the general law as to the frustration of contracts) the person referred to in paragraph (a) or (b) of that subsection shall, together with all other persons, be discharged from the further performance of the suspended contract so far as it relates to any such disposal as is mentioned in subsection (4).

(6) In subsections (4) and (5) any reference to a contract (except in the context of such a contract as is mentioned in subsection (5)(b)) includes a contract made in pursuance of an order of any court; but those subsections do not apply to any contract providing for the eventuality of a notice being given under section 13 in relation to the whole or part of the property in which any such interest as is referred to in subsection (4) subsists.