Leasehold and Freehold Reform Act 2024

Duty of immediate landlord to conduct commutation claim on behalf of affected other landlords

19 (1) This paragraph applies if—

(a) there are one or more qualifying intermediate leases of property to which a rent variation notice relates, and

(b) notice is given under paragraph 8(3).

(2) The immediate landlord must conduct the response to the tenant’s claim for a rent reduction on their own behalf and on behalf of the affected other landlords, including by—

(a) agreeing the terms of variation of the qualifying lease,

(b) agreeing the amount of the required premium,

(c) receiving the whole of the required premium and (where it is so received) holding the required premium for themselves and the affected other landlords pending determination of the shares of the required premium in accordance with paragraph 8(9), and

(d) conducting all proceedings arising out of the rent variation notice (whether the proceedings are for resisting or giving effect to the claim).

(3) If the immediate landlord receives the whole of the required premium, the immediate landlord’s written receipt for payment of that premium is a complete discharge to the tenant.

(4) Sub-paragraphs (2)(c) and (3) do not apply if the price payable is required to be paid into the tribunal by virtue of sub-paragraph (6)(c).

(5) The immediate landlord is not liable to any of the affected other landlords for any loss or damage caused by any act or omission in compliance or intended compliance with the duty under sub-paragraph (2) if the immediate landlord acts in good faith and with reasonable care and diligence.

(6) Any affected other landlord may—

(a) apply to the appropriate tribunal for directions as to the manner in which the immediate landlord is to exercise the authority given by sub-paragraph (2);

(b) be separately represented in any proceedings in which the amount of the required premium is being determined;

(c) by giving notice to the tenant and the immediate landlord, require the tenant to pay into the tribunal the whole of the required premium.

(7) Each of the affected other landlords must make such contribution as is just to costs and expenses which are properly incurred by the immediate landlord in connection with the claim by the tenant under this Schedule but which are not recoverable or recovered from the tenant.

(8) The appropriate tribunal—

(a) may determine any matter arising in relation to the amount of any costs payable by virtue of sub-paragraph (7), and

(b) where it has determined such an amount of costs, may make an order requiring a person to pay those costs.

(9) The court or the appropriate tribunal may order any affected other landlord to pay to the immediate landlord the costs, or a contribution to the costs, incurred by the immediate landlord in obtaining from the appropriate tribunal money that has been paid into it in compliance with a requirement imposed under sub-paragraph (6)(c) if—

(a) that affected other landlord imposed the requirement, and

(b) the immediate landlord shows that it was unreasonable for that affected other landlord to impose the requirement.

(10) The court or the appropriate tribunal may order the immediate landlord to pay to any affected other landlord the costs, or a contribution to the costs, incurred by that affected other landlord in obtaining from the appropriate tribunal money that has been paid into it in compliance with a requirement imposed under sub-paragraph (6)(c) if—

(a) that affected other landlord imposed the requirement, and

(b) that affected other landlord shows that the requirement was imposed because of unreasonable conduct by the immediate landlord.

(11) In this paragraph—

• “affected other landlord” means the landlord under a qualifying intermediate lease of which the rent is to be reduced in accordance with paragraph 8 (whether by virtue of paragraph 8(3) or (4));

• “immediate landlord” means the immediate landlord under the lease to which the rent variation notice relates (and to which the rent variation notice must be given);

• “qualifying intermediate lease” has the meaning given in paragraph 8;

• “required premium” means the required premium payable under paragraph 7.