Part 3Allocation of rents and renewal premiums etc.

Allocation of renewal premium

43Partially continuing leases: allocation of renewal premium

(1)This section applies to a lease which—

(a)contains a renewal obligation,

(b)complies with section 1(3)(b) and (c) by virtue of section 71(1)(b), and

(c)is a partially continuing lease.

(2)The landlord must, before the expiry of the period of 2 years beginning with the appointed day, allocate the renewal premium between the converted subjects and continuing subjects.

(3)For the purposes of subsection (2), the renewal premium is—

(a)the renewal premium payable under the lease immediately before the appointed day, or

(b)where a cumulo renewal premium is allocated to the lease under section 42(2), the premium so allocated.

(4)The allocation under subsection (2) must be in such proportions as are reasonable in all the circumstances.

(5)For the purposes of subsection (4), the proportions are presumed to be reasonable in so far as they accord with any allocation of rent under section 41.

(6)The renewal premium payable from the appointed day under the partially continuing lease is the renewal premium allocated to the continuing subjects under subsection (2).