Law of Property Act 1925

Rentcharges E+W

[F1 120A Interpretation E+W

(1) For the purposes of sections 120B to 122 a rentcharge is “regulated” if it is of a kind that could not be created in accordance with section 2 of the Rentcharges Act 1977.

(2) In sections 120B to 120D—

• “charged land” means the land which is, or the land the income of which is, charged by the rentcharge;

• “demand for payment” means a notice under section 120B(1)(a) demanding payment of regulated rentcharge arrears;

• “landowner”, in relation to a sum that is charged by rentcharge, means the person who holds the charged land;

• “regulated rentcharge arrears” means a sum charged by a regulated rentcharge that is unpaid after the time appointed for its payment;

• “rent owner”, in relation to a sum that is charged by rentcharge, means the person who holds title to the rentcharge.

Textual Amendments

F1 Ss. 120A-120D inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(2), 124(2)(a) (with s. 113(5))

120B Regulated rentcharges: notice of arrears before enforcement E+W

(1) No action to recover or compel payment of regulated rentcharge arrears may be taken unless—

(a) the rent owner has served the landowner with notice demanding payment of those arrears,

(b) the demand for payment complies with the requirements of subsection (2),

(c) the demand for payment either—

(i) complies with the requirements of subsection (3), or

(ii) does not need to comply with those requirements (see subsection (5)), and

(d) the period of 30 days, beginning with the day on which the demand for payment is served, has ended.

(2) The demand for payment must set out—

(a) the name of the rent owner;

(b) the address of the rent owner and, if that address is not in England and Wales, an address in England and Wales at which notices (including notices in proceedings) may be served on the rent owner by the landowner;

(c) the amount of the regulated rentcharge arrears;

(d) how that amount has been calculated;

(e) details of how to pay that amount.

(3) The demand for payment must set out, or be served with—

(a) a copy of the instrument creating the regulated rentcharge;

(b) proof that title to the regulated rentcharge is held by the rent owner.

(4) The demand for payment is to be taken to comply with the requirement in subsection (3)(b) if—

(a) in a case where the rent owner’s title to the regulated rentcharge is registered at the Land Registry, the demand includes a copy of that registered title; or

(b) in a case where title to the regulated rentcharge is not registered at the Land Registry, the demand includes copies of the instruments by which title to the rentcharge has passed to the rent owner.

(5) A demand for payment served by a rent owner on a landowner in relation to a regulated rentcharge does not need to comply with subsection (3) if—

(a) a previous demand for payment that has been served by that rent owner on that landowner in relation to that rentcharge complied with that subsection, and

(b) since the service of that previous demand, there has been no material change in the matters to which subsection (3) relates.

(6) No sum is payable by the landowner in respect of the preparation or service of a demand for payment (including obtaining or preparing documents or copies in order to comply with subsection (3)).

(7) This section applies to action to recover or compel payment of rentcharge arrears whether the action is authorised by this Act or is otherwise available (and includes bringing proceedings).

Textual Amendments

F1 Ss. 120A-120D inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(2), 124(2)(a) (with s. 113(5))

120C Service of notice under section 120B: additional requirement E+W

(1) This section applies if—

(a) notice under section 120B demanding the payment of rentcharge arrears is served in compliance with the requirements of section 196(3) or (4), but

(b) the place of abode or business at which the notice is left, or to which the notice is sent, in compliance with those requirements is not the charged land.

(2) The notice is sufficiently served only if (in addition to complying with the requirements of section 196(3) or (4))—

(a) it is affixed or left for the landowner on the charged land, or

(b) it is sent by post in a registered letter addressed to the landowner, by name, at the charged land, and if that letter is not returned by the postal operator (within the meaning of Part 3 of the Postal Services Act 2011) concerned undelivered; and that service shall be deemed to be made at the time at which the registered letter would in the ordinary course be delivered.

Textual Amendments

F1 Ss. 120A-120D inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(2), 124(2)(a) (with s. 113(5))

120D Regulated rentcharge arrears: administration charges E+W

(1) The Secretary of State may by regulations limit the amounts payable by landowners, directly or indirectly, in respect of action to recover or compel payment of regulated rentcharge arrears.

(2) Regulations under this section may (in particular) provide that no amount is to be payable by landowners in respect of particular descriptions of action to recover or compel payment of regulated rentcharge arrears.

(3) Regulations under this section may make—

(a) different provision for different cases;

(b) transitional or saving provision.

(4) Regulations under this section are to be made by statutory instrument.

(5) A statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.]

Textual Amendments

F1 Ss. 120A-120D inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(2), 124(2)(a) (with s. 113(5))

121 Remedies for the recovery of annual sums charged on land. E+W

(1) Where a person is entitled to receive out of any land, or out of the income of any land, any annual sum, payable half-yearly or otherwise, whether charged on the land or on the income of the land, and whether by way of rentcharge or otherwise not being rent incident to a reversion, then, subject and without prejudice to all estates, interests, and rights having priority to the annual sum, the person entitled to receive the annual sum shall have such remedies for recovering and compelling payment thereof as are described in this section, as far as those remedies might have been conferred by the instrument under which the annual sum arises, but not further.

[F2 (1A) But where such a sum is charged by way of a regulated rentcharge, the rent owner does not have any of those remedies for recovering and compelling payment of the sum on and after 27 November 2023.]

F3 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) If at any time the annual sum or any part thereof is unpaid for forty days next after the time appointed for any payment in respect thereof, then, although no legal demand has been made for payment thereof, the person entitled to receive the annual sum may enter into possession of and hold the land charged or any part thereof, and take the income thereof, until thereby or otherwise the annual sum and all arrears thereof due at the time of his entry, or afterwards becoming due during his continuance in possession, and all costs and expenses occasioned by nonpayment of the annual sum, are fully paid; and such possession when taken shall be without impeachment of waste.

(4) In the like case the person entitled to the annual sum, whether taking possession or not, may also by deed demise the land charged, or any part thereof, to a trustee for a term of years, with or without impeachment of waste, on trust, by all or any of the means hereinafter mentioned, or by any other reasonable means, to raise and pay the annual sum and all arrears thereof due or to become due, and all costs and expenses occasioned by nonpayment of the annual sum, or incurred in compelling or obtaining payment thereof, or otherwise relating thereto, including the costs of the preparation and execution of the deed of demise, and the costs of the execution of the trusts of that deed:

Provided that this subsection shall not authorise the creation of a legal term of years absolute after the commencement of this Act, save where the annual sum is a rentcharge held for a legal estate.

The surplus, if any, of the money raised, or of the income received, under the trusts of the deed shall be paid to the person for the time being entitled to the land therein comprised in reversion immediately expectant on the term thereby created.

The means by which such annual sum, arrears, costs, and expenses may be raised includes—

(a) the creation of a legal mortgage or a sale (effected by assignment or subdemise) of the term created in the land charged or any part thereof,

(b) the receipt of the income of the land comprised in the term.

(5) This section applies only if and as far as a contrary intention is not expressed in the instrument under which the annual sum arises, and has effect subject to the terms of that instrument and to the provisions therein contained.

F4 (6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7) The powers and remedies conferred by this section apply where the instrument creating the annual sum comes into operation after the thirty-first day of December, eighteen hundred and eighty-one, and whether the instrument conferring the power under which the annual sum was authorised to be created came into operation before or after that date, unless the instrument creating the power or under which the annual sum is created otherwise directs.

Textual Amendments

F2 S. 121(1A) inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(3), 124(2)(a) (with s. 113(5))

F3 S. 121(2) repealed (6.4.2014) by Tribunals, Courts and Enforcement Act 2007 (c. 15), s. 148, Sch. 14 para. 23, Sch. 23 Pt. 4 (with s. 89); S.I. 2014/768, art. 2(1)(b)

F4 S. 121(6) repealed (6.4.2010) by Perpetuities and Accumulations Act 2009 (c. 18), ss. 4(a), 22(2), Schs. (with s. 15(1)(4)1718); S.I. 2010/37, art. 2

Modifications etc. (not altering text)

C1 S. 121 saved by Perpetuities and Accumulations Act 1964 (c. 55), s. 11(1); extended by Statute Law (Repeals) Act 1969 (c. 52), s. 3

122 Creation of rentcharges charged on another rentcharge and remedies for recovery thereof. E+W

(1) A rentcharge or other annual sum (not being rent incident to a reversion) payable half yearly or otherwise may be granted, reserved, charged or created out of or on another rentcharge or annual sum (not being rent incident to a reversion) charged on or payable out of land or on or out of the income of land, in like manner as the same could have been made to issue out of land.

[F5 (1A) But on and after 27 November 2023 such a rentcharge or other annual sum may not be granted, reserved, charged or created out of or on another rentcharge if it is a regulated rentcharge.]

(2) If at any time the annual sum so created or any part thereof is unpaid for twenty-one days next after the time appointed for any payment in respect thereof, the person entitled to receive the annual sum shall (without prejudice to any prior interest or charge) have power to appoint a receiver of the annual sum charged or any part thereof, and the provisions of this Act relating to the appointment, powers, remuneration and duties of a receiver, shall apply in like manner as if such person were a mortgagee entitled to exercise the power of sale conferred by this Act, and the annual sum charged were the mortgaged property and the person entitled thereto were the mortgagor.

(3) The power to appoint a receiver conferred by this section shall (where the annual sum is charged on a rentcharge) take effect in substitution for the remedies conferred, in the case of annual sums charged on land, by the last preceding section, but subsection (6) of that section shall apply and have effect as if herein re-enacted and in terms made applicable to the powers conferred by this section.

(4) This section applies to annual sums expressed to be created before as well as after the commencement of this Act, and, but without prejudice to any order of the court made before the commencement of this Act, operates to confirm any annual sum which would have been validly created if this section had been in force.

Textual Amendments

F5 S. 122(1A) inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(4), 124(2)(a) (with s. 113(5))

Modifications etc. (not altering text)

C2 S. 122 saved by Perpetuities and Accumulations Act 1964 (c. 55), s. 11(1)

[F6 122A Contrary provision of no effect E+W

An instrument creating a rentcharge, or a contract or any other arrangement, (whenever entered into) is of no effect to the extent that it makes provision that is contrary to—

(a) section 120B, 120C, 121(1A) or 122(1A), or

(b) regulations under section 120D.]

Textual Amendments

F6 S. 122A inserted (24.7.2024) by Leasehold and Freehold Reform Act 2024 (c. 22), ss. 113(6), 124(2)(a)