|Commonhold and Leasehold
Ms Keeble: Amendment No. 73 would prevent a RTM company from granting an approval that would diminish a landlord's reversionary interest. We accept that it is important that landlords' interests are safeguarded against the granting of inappropriate approval. However, the Bill already addresses that matter satisfactorily. Clause 96 provides that where the right to manage is acquired, the right-to-manage company takes on primary responsibility for approvals that are required under the leases. However, where the RTM company proposes to grant a consent, clause 96(4) provides that it must first give written notice of that intention to the relevant landlord. The landlord then has the opportunity to decide whether to agree or
Column Number: 102object to the granting of the consent and to notify the RTM company accordingly.
When a landlord decides that he wishes to object, the RTM company may grant approval only if one of two conditions is met: the landlord must agree to withdraw the objection, or, alternatively, an application must be made to a leasehold valuation tribunal for its agreement that the approval should be granted. Those arrangements already make admirable provision for safeguarding the landlord's legitimate interest. A landlord who believes that his reversionary interest would be damaged by the granting of an approval is able, first, to ensure that the RTM company does not disregard that and grant the approval itself and, secondly, to seek to persuade a LVT that the approval should not be granted. In the latter case, one argument that the landlord could place before the tribunal would be that the approval would unduly harm his reversionary interests.
The amendment adds nothing to the arrangements, and our first concern about it is that what will or will not diminish the reversionary value of the landlord's interests is unclear and subjective. It could be argued that any consent to improvement or alteration might diminish the immediate value of the landlord's reversion. For example, would that mean that a RTM company should never grant such an approval? Would the amendment mean that the company should not grant an approval, even if the landlord agreed that approval should be granted?
We are not clear what would happen if the RTM company decided that it wished to grant an approval on the basis that it does not believe that the reversionary interest would be affected but the landlord alleges otherwise. The issue is who would adjudicate in such disputes and why it would be better than the present arrangements of allowing all disputed approvals to be LVTs.
The arrangements in the Bill are the most sensible and practical way to deal with the issue addressed in the amendment, which I hope will be withdrawn.
Mr. Cash: The question of what is sensible and practical is often a matter of dispute. I do not wish to add to what I have said, but I am glad the Minister recognises that there is a problem. She believes that the Bill adequately caters for the issues raised; I am not satisfied that that is so, and I shall press the amendment to a Division.
It may have been an oversight, but the hon. Lady did not mention Government amendment No. 82 in this group—
The Chairman: Order. That Government amendment is in a separate group. It will be debated after amendments Nos. 73 and 71.
Mr. Cash: Thank you, Mr. Illsley.
Column Number: 103
Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 10.
Division No. 6]
Ms Keeble: I beg to move amendment No. 82, in page 49, line 37, at end insert
If it is any comfort to the hon. Member for Stone, I was informed only late in the day too. This is a technical amendment to prevent an anomaly in the approvals regime that the Land Registry has highlighted. As hon. Members are aware, clauses 96 and 97 make the RTM company responsible for the granting of approvals under long leases of the whole or any part of the premises that are subject to the right to manage. The Land Registry has alerted us to the fact that a requirement under a lease to obtain a consent can sometimes be replicated by identical restrictions applied for and entered on the land register in section 58 of the Land Registration Act 1925. The practical effect of such a restriction on the register is that the Land Registry must satisfy itself that a consent has been obtained as required by the restriction, before it can proceed to make the relevant change on the register. Furthermore, the registry will have to be satisfied that the consent has been obtained from the person named in the restriction, which could often be the landlord.
This restriction would therefore frustrate the intentions behind clauses 96 and 97. We can envisage a scenario in which a leaseholder has obtained approval from the RTM company in accordance with clauses 96 and 97, but then needs to approach the landlord separately for consent to satisfy the restriction on the register. That is clearly undesirable. There would therefore be a parallel consent regime, but one that required consent for the same thing from different people. The amendment would rectify that anomaly, and I hope that the Committee will agree to it.
Mr. Cash: I am grateful to the Minister for bringing this forward. It is obviously on the advice of the Chief Land Registrar. Not only do we have this Committee in common, Mr. Illsley, but fairly recently we were together on the Land Registration Bill. Even before that, although I hesitate to refer to this extremely contentious matter, there was what is now described as an arrangement in a brewery at a football ground not far from your constituency. I served on a Committee
Column Number: 104for about eight weeks on that matter. We have become accustomed to having to deal with extremely contentious issues. However, the matter before us is not contentious. If an amendment is required to the land registration legislation to accommodate the arrangements set out in the Bill, and there are one or two other matters where amendments have been tabled that affect land registration, I should be grateful if it could be slotted in at the right place so that that Bill can be in shipshape form on Report. I am grateful to the Minister for her explanation.
Amendment agreed to.
Clause 96, as amended, ordered to stand part of the Bill.
Clauses 97 to 100 ordered to stand part of the Bill.
Schedule 7 agreed to.
Clauses 101 and 102 ordered to stand part of the Bill.
|©Parliamentary copyright 2002||Prepared 17 January 2002|