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Commonhold and Leasehold Reform Act 2002

Status:

This is the original version (as it was originally enacted).

Termination: voluntary winding-up

43Winding-up resolution

(1)A winding-up resolution in respect of a commonhold association shall be of no effect unless—

(a)the resolution is preceded by a declaration of solvency,

(b)the commonhold association passes a termination-statement resolution before it passes the winding-up resolution, and

(c)each resolution is passed with at least 80 per cent. of the members of the association voting in favour.

(2)In this Part—

  • “declaration of solvency” means a directors' statutory declaration made in accordance with section 89 of the Insolvency Act 1986 (c. 45),

  • “termination-statement resolution” means a resolution approving the terms of a termination statement (within the meaning of section 47), and

  • “winding-up resolution” means a resolution for voluntary winding-up within the meaning of section 84 of that Act.

44100 per cent. agreement

(1)This section applies where a commonhold association—

(a)has passed a winding-up resolution and a termination-statement resolution with 100 per cent. of the members of the association voting in favour, and

(b)has appointed a liquidator under section 91 of the Insolvency Act 1986 (c. 45).

(2)The liquidator shall make a termination application within the period of six months beginning with the day on which the winding-up resolution is passed.

(3)If the liquidator fails to make a termination application within the period specified in subsection (2) a termination application may be made by—

(a)a unit-holder, or

(b)a person falling within a class prescribed for the purposes of this subsection.

4580 per cent. agreement

(1)This section applies where a commonhold association—

(a)has passed a winding-up resolution and a termination-statement resolution with at least 80 per cent. of the members of the association voting in favour, and

(b)has appointed a liquidator under section 91 of the Insolvency Act 1986.

(2)The liquidator shall within the prescribed period apply to the court for an order determining—

(a)the terms and conditions on which a termination application may be made, and

(b)the terms of the termination statement to accompany a termination application.

(3)The liquidator shall make a termination application within the period of three months starting with the date on which an order under subsection (2) is made.

(4)If the liquidator fails to make an application under subsection (2) or (3) within the period specified in that subsection an application of the same kind may be made by—

(a)a unit-holder, or

(b)a person falling within a class prescribed for the purposes of this subsection.

46Termination application

(1)A “termination application” is an application to the Registrar that all the land in relation to which a particular commonhold association exercises functions should cease to be commonhold land.

(2)A termination application must be accompanied by a termination statement.

(3)On receipt of a termination application the Registrar shall note it in the register.

47Termination statement

(1)A termination statement must specify—

(a)the commonhold association’s proposals for the transfer of the commonhold land following acquisition of the freehold estate in accordance with section 49(3), and

(b)how the assets of the commonhold association will be distributed.

(2)A commonhold community statement may make provision requiring any termination statement to make arrangements—

(a)of a specified kind, or

(b)determined in a specified manner,

about the rights of unit-holders in the event of all the land to which the statement relates ceasing to be commonhold land.

(3)A termination statement must comply with a provision made by the commonhold community statement in reliance on subsection (2).

(4)Subsection (3) may be disapplied by an order of the court—

(a)generally,

(b)in respect of specified matters, or

(c)for a specified purpose.

(5)An application for an order under subsection (4) may be made by any member of the commonhold association.

48The liquidator

(1)This section applies where a termination application has been made in respect of particular commonhold land.

(2)The liquidator shall notify the Registrar of his appointment.

(3)In the case of a termination application made under section 44 the liquidator shall either—

(a)notify the Registrar that the liquidator is content with the termination statement submitted with the termination application, or

(b)apply to the court under section 112 of the Insolvency Act 1986 (c. 45) to determine the terms of the termination statement.

(4)The liquidator shall send to the Registrar a copy of a determination made by virtue of subsection (3)(b).

(5)Subsection (4) is in addition to any requirement under section 112(3) of the Insolvency Act 1986.

(6)A duty imposed on the liquidator by this section is to be performed as soon as possible.

(7)In this section a reference to the liquidator is a reference—

(a)to the person who is appointed as liquidator under section 91 of the Insolvency Act 1986, or

(b)in the case of a members' voluntary winding up which becomes a creditors' voluntary winding up by virtue of sections 95 and 96 of that Act, to the person acting as liquidator in accordance with section 100 of that Act.

49Termination

(1)This section applies where a termination application is made under section 44 and—

(a)a liquidator notifies the Registrar under section 48(3)(a) that he is content with a termination statement, or

(b)a determination is made under section 112 of the Insolvency Act 1986 (c. 45) by virtue of section 48(3)(b).

(2)This section also applies where a termination application is made under section 45.

(3)The commonhold association shall by virtue of this subsection be entitled to be registered as the proprietor of the freehold estate in each commonhold unit.

(4)The Registrar shall take such action as appears to him to be appropriate for the purpose of giving effect to the termination statement.

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