In the ongoing evolution of Landlord and tenant law there have been many new Acts of Parliament which are not only lengthy but also come with a number of Statutory Instruments (secondary legislation) attached to them. They are a result of a determined effort by successive Governments to balance the rights of leaseholders against the power of freeholders. There are 5 main Acts of Parliament relating specifically to block management.
LANDLORD AND TENANT ACT 1985
The Landlord and Tenant Act 1985 is the first of the 5 Acts and it gives the framework for leaseholder rights under the terms of their leases regarding service charge provisions. A time limit was placed on making service charge demands, and the definition of ‘reasonableness’ of those demands was given. Leaseholders also got the right to a ‘recognised’ Residents Association. An overview of other significant rights under the Act can be found here.
The Landlord and Tenant Act 1987 comes next, supporting and expanding the framework of the 1985 Act with requirements such as all service charge monies to be held in trust. Another right is the Right of First Refusal meaning that leaseholders can purchase the freehold before it is offered on the open market or by auction. They also have the right to compulsory acquire the freehold (where the freeholder is in constant breach of their obligations) and the right to replace management via the FTT. An overview of other significant rights can be found here.
LEASEHOLD REFORM HOUSING AND URBAN DEVELOPMENT ACT 1993
After this comes the Leasehold Reform, Housing and Urban Development Act 1993 which finally gave leaseholders of flats the right to apply to the freeholder for a statutory 90 years lease extension. Leaseholders also got the right to collectively purchase the freehold, becoming the new freeholders themselves.
The Act was however not only widely considered to be poorly drafted but it contained a number of anomalies despite amending areas of both the 1987 and 1985 Acts.
HOUSING ACT 1996
The Housing Act 1996 is the fourth of the five main Acts but it wasn’t a new Act. Instead powerful lobbying and the prospect of another General Election resulted in considerable amendments being made to the 1993 Act, resulting in this Act. An overview can be found here.
COMMONHOLD AND LEASEHOLD REFORM ACT 2002
The Commonhold and Leasehold Reform Act 2002 was the jewel in the (then) Governments crown. It gave leaseholders the right to manage, a ‘no-fault’ process allowing them to either replace their own managing agent with one of their own choosing (or self manage) and introduced Commonhold, a third choice on purchasing property. Sadly, although it was placed on the statute books, it never took off. It also created administration charges (which are neither ground rent or service charges). Other key sections of the Act, including the segments that were not implemented, can be found here.