Part 4Compensation for loss of landlord's rights

Additional payment

I151Extinguished rights

1

The rights referred to in section 50(1) are—

a

any right to a rent to the extent that such right is expressed wholly or partly in non-monetary terms,

b

any right to have the amount payable as rent reviewed or increased from time to time,

c

any right to a rent to the extent that the amount payable is variable from year to year,

d

any right to receive a premium (other than a renewal premium which satisfies the condition in section 49(1)(b)) in return for renewing the lease after a fixed period, where, by virtue of section 71(1)(b) such a renewal is required in order for the lease to comply with section 1(3)(b) and (c),

e

any right to resume natural possession of the land subject to a lease upon expiry of the lease, provided that the lease would expire no later than the end of the period of 200 years beginning with the appointed day,

f

any right, other than a right of pre-emption, enabling a lease to be terminated earlier than the date on which the lease would otherwise expire, providing that such right—

i

is exercisable no later than the end of the period of 200 years beginning with the appointed day,

ii

is not a provision of the lease purporting to terminate the lease, or entitling the landlord to terminate it, in the event of a failure of the tenant to comply with any provision of the lease,

iii

is not a provision of the lease deeming such a failure to be a material breach of contract, and

iv

does not become a real burden by virtue of section 16, 19 or 23, and

g

any right to development value, providing that such right does not become a real burden by virtue of section 16 or 19.

2

In this Part—

  • “development value” means any significant increase in the value of a lease arising as a result of the subjects of the lease becoming free to be used, or dealt with, in some way not permitted under the lease, and

  • any reference to a “right to development value” means a right to the benefit of any development value of a lease where—

    1. a

      the lease was granted subject to a condition, enforceable by the landlord, reserving to the landlord the benefit (whether wholly or in part) of any development value, and

    2. b

      the consideration (including rent) paid for, or payable under, the lease was—

      1. i

        nominal, or

      2. ii

        significantly lower than it would have been had the lease not been subject to the condition.