The landlord must (unless note 3 applies) serve a notice in reply in Form 3 set out in the Schedule to the Leasehold Reform (Notices) Regulations 1997 (or in substantially the same form) within two months of the service on him of this notice. If he does not admit the tenant’s right to have the freehold or an extended lease, the notice in reply must state the grounds on which the right is not admitted. If the landlord intends to apply to the court for possession of the house and premises in order to redevelop it (section 17) or to occupy it (section 18), his notice must say so. If he does not so intend, but he objects under subsection (4) or (5) of section 2 to the inclusion in the claim of a part of the house and premises which projects into other property, or to the exclusion from the claim of property let with the house and premises but not occupied with and used for the purposes of the house by any occupant of it, he must give notice of his objection with or before his notice in reply; unless in his notice in reply he reserves the right to give it later, in which case it must still be given within two months of the service on him of the tenant’s notice. If the landlord admits the claim, the admission is binding on him, unless he shows that he was misled by misrepresentation or concealment of material facts, but it does not conclude any question of the correctness of the particulars of the house and premises as set out in the claim (Schedule 3, paragraph 7).

Where the tenant’s immediate landlord is not the freeholder, any proceedings arising out of the tenant’s notice, whether for resisting or for giving effect to the claim, must be conducted by the person who is designated as “the reversioner” in accordance with paragraph 2 of Schedule 1 to the Act and he must give the notice in reply. The reversioner is the landlord whose tenancy carries an expectation of possession of the house and premises of 30 years or more after the expiration of all inferior tenancies and, if there is more than one such landlord, it means the landlord whose tenancy is nearest to that of the tenant; if there is no such landlord, it means the owner of the freehold. The tenant will be informed in the notice in reply if it is given by a landlord acting as the reversioner.

“Premises” to be included with the house in the claim are any garage, outhouse, garden, yard and appurtenances which at the time of the notice are let to the tenant with the house.

In respect of a house, “long tenancy” has the meaning given by section 3 of the Act. (Special provisions apply in relation to business tenancies — see section 1(1ZC) of the Act inserted by section 140 of the Commonhold and Leasehold Reform Act 2002). Where there have been successive tenancies, particulars should be given of each tenancy. In the case of a lease already extended under the Act, the date of the extension and the original term date should be given. In addition to section 3 of the Act, section 174(a) of the Housing Act 1985 provides for certain tenancies granted pursuant to the right to buy to be treated as long tenancies. Section 1B of the Act also provides for certain tenancies terminable on death or marriage to be long tenancies for the limited right described in note 11. Under Schedule 4A to the Act, certain shared ownership leases granted by public authorities, housing associations and registered social landlords carry neither the right to enfranchise nor the right to obtain an extended lease.

The claimant must have owned the lease for two years prior to the date of the application for enfranchisement or lease extension (section 1(1)(b) of the Act, as amended by sections 138 and 139 of the Commonhold and Leasehold Reform Act 2002).

In addition to the provision of section 4 of the Act (meaning of “low rent”), section 1A(2) of the Act provides for tenancies falling within section 4A(1) of the Act to be treated as tenancies at a low rent for the limited right described in note 11.

Section 1AA confers a limited right to enfranchisement (described in note 11) in the case of leases which would qualify but for the fact that the tenancy is not a tenancy at a low rent, with two exceptions. The first is where the lease is excluded from the right under section 1AA(3): i.e. where the house is in an area designated as a rural area, the freehold of the house is owned together with adjoining land which is not occupied for residential purposes, and the tenancy was either granted on or before 1st April 1997 or was granted after that date but before the coming into force of section 141 of the Commonhold and Leasehold Reform Act 2002, for a term of 35 years or less. Information as to the location of designated rural areas is held at the offices of leasehold valuation tribunals. The second exception applies to any shared ownership lease (as defined by section 622 of the Housing Act 1985) originally granted by a housing association or a registered social landlord.

Section 1(1ZA) of the Act (inserted by section 138(2) of the Commonhold and Leasehold Reform Act 2002) provides that head lessees do not have rights to enfranchise or a lease extension where there exist inferior tenancies which confer on the tenant the right to enfranchise and a lease extension under the Act. Under section 1(1ZB) of the Act, where there exists an inferior long tenancy (as defined under section 7 of the Leasehold Reform, Housing and Urban Development Act 1993) of a flat which confers on the tenant the right to enfranchise or a new lease under that Act the head lessee only has the right to enfranchise or a lease extension under the Act where he meets the residence requirement (see note 10 below). It is therefore necessary to provide details of any other long tenancies.

Particulars of residence and occupation are required in relation to those cases specified in paragraph 7 of the Schedule to this notice (see section 1(1ZB) and (1B) of the Act as inserted, respectively, by sections 138 and 139 of the Commonhold and Leasehold Reform Act 2002). The residence requirement in these specified cases is that the tenant has lived in the property as his only or main residence for the last two years or for periods amounting to two years in the last ten years.

A claimant who relies on any one or more of the provisions in sections 1A, 1AA or 1B of the Act, (or where the tenancy of the house and premises has been extended under section 14 and the notice under section 8(1) was given (whether by a tenant or a sub-tenant) after the original term date of the tenancy), has the right to have the freehold at a price determined in accordance with section 9(1C) of the Act, but not the right to have an extended lease.

Section 1A(1) applies to a tenancy of a house and premises the value of which exceeds the applicable financial limit. Sections 1A(2) and 1B are described in notes 7 and 5 respectively. Section 1AA (described in note 8) applies to certain cases where the long lease fails the low rent test.

In accordance with section 28(1)(b)(ii) of the Leasehold Reform Act 1967, this notice may not be served later than two months after a copy of the certificate has been served on the tenant.

“Premises” to be included with the house in the claim are any garage, outhouse, garden, yard and appurtenances which at the time of the notice are let to the tenant with the house.

In respect of a house, “long tenancy” has the meaning given by section 3 of the Act. (Special provisions apply in relation to business tenancies — see section 1(1ZC) of the Act inserted by section 140 of the Commonhold and Leasehold Reform Act 2002). Where there have been successive tenancies, particulars should be given of each tenancy. In the case of a lease already extended under the Act, the date of the extension and the original term date should be given. In addition to section 3 of the Act, section 174(a) of the Housing Act 1985 provides for certain tenancies granted pursuant to the right to buy to be treated as long tenancies. Section 1B of the Act also provides for certain tenancies terminable on death or marriage to be long tenancies for the limited right described in note 10. Under Schedule 4A to the Act, certain shared ownership leases granted by public authorities, housing associations and registered social landlords carry neither the right to enfranchise nor the right to obtain an extended lease.

The claimant must have owned the lease for two years prior to the date of the application for enfranchisement or lease extension (section 1(1)(b) of the Act, as amended by sections 138 and 139 of the Commonhold and Leasehold Reform Act 2002).

In addition to the provision of section 4 of the Act (meaning of “low rent”), section 1A(2) of the Act provides for tenancies falling within section 4A(1) of the Act to be treated as tenancies at a low rent for the limited right described in note 10.

Section 1AA confers a limited right to enfranchisement (described in note 10) in the case of leases which would qualify but for the fact that the tenancy is not a tenancy at a low rent, with two exceptions. The first is where the lease is excluded from the right under section 1AA(3): i.e. where the house is in an area designated as a rural area, the freehold of the house is owned together with adjoining land which is not occupied for residential purposes, and the tenancy was either granted on or before 1st April 1997 or was granted after that date but before the coming into force of section 141 of the Commonhold and Leasehold Reform Act 2002, for a term of 35 years or less. Information as to the location of designated rural areas is held at the offices of leasehold valuation tribunals. The second exception applies to any shared ownership lease (as defined by section 622 of the Housing Act 1985) originally granted by a housing association or a registered social landlord.

Section 1(1ZA) of the Act (inserted by section 138(2) of the Commonhold and Leasehold Reform Act 2002) provides that head lessees do not have rights to enfranchise or a lease extension where there exist inferior tenancies which confer on the tenant the right to enfranchise and a lease extension under the Act. Under section 1(1ZB) of the Act, where there exists an inferior long tenancy (as defined under section 7 of the Leasehold Reform, Housing and Urban Development Act 1993) of a flat which confers on the tenant the right to enfranchise or a new lease under that Act, the head lessee only has the right to enfranchise or a lease extension where he meets the residence requirements (see note 9 below). It is therefore necessary to provide details of any other long tenancies.

Particulars of residence and occupation are required in relation to those cases specified in paragraph 7 of the Schedule to this notice (see section 1(1ZB) and (1B) as inserted, respectively, by sections 138 and 139 of the Commonhold and Leasehold Reform Act 2002). The residence requirement in these specified cases is that the tenant has lived in the property as his only or main residence for the last two years or for periods amounting to two years in the last ten years.

A claimant who relies on any one or more of the provisions in section 1A, 1AA or 1B of the Act, (or where the tenancy of the house and premises has been extended under section 14 and the notice under section 8(1) was given (whether by a tenant or a sub-tenant) after the original term date of the tenancy), has the right to have the freehold at a price determined in accordance with section 9(1C) of the Act, but not the right to have an extended lease. Section 1A(1) applies to a tenancy of a house and premises the value of which exceeds the applicable financial limit.

Sections 1A(2) and 1B are described in notes 7 and 5 respectively. Section 1AA (described in note 8) applies to certain cases where the long lease fails the low rent test.