3 After Clause 11, insert the following new clause:
"Determination of price for leasehold enfranchisement.
—(1) In section 9(1A) of the Leasehold Reform Act 1967 (determination of price payable for enfranchisement of higher value houses), in paragraph (a) (assumption that vendor is selling subject to existing tenancy) after "no right to acquire the freehold" insert "or an extended lease and, where the tenancy has been extended under this Part of this Act, that the tenancy will terminate on the original term date.".
(2) In section 23(5) of the Leasehold Reform Act 1967 (provisions as to tenancy granted in satisfaction of tenant's rights under Part I), in paragraph (b) (provisions which apply as if the tenancy were granted by way of extension) at the beginning insert "section 9(1) and (1A) above".
(3) The above amendments apply where the tenant's notice under section 8 of the Leasehold Reform Act 1967 (notice of desire to have the freehold) was given after the passing of this Act, notwithstanding that it was given before the commencement of this section, unless the price has by commencement been determined by agreement or otherwise.
§ The Commons agree to the above amendment with the following amendment:
4 Leave out subsection (3) and insert—
"(3) The above amendments do not apply—
§ 4.30 p.m.
§ Lord Skelmersdale
My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 4 to your Lordships' Amendment No. 3. This amendment concerns a theme that has been running through the operation of the Leasehold Reform Act, ever since 1984 when my noble friend Lord Coleraine asked my noble friend Lord Bellwin, speaking from this Box, whether something could be done about the two methods of assessment for leasehold enfranchisement in the higher rateable value bracket. My noble friend replied that until the matter was tested in the courts, there was nothing that the Government could do about it. It was tested in the now famous Hickman case, which went to the Court of Appeal, which ruled on 4th March this year.
My noble friend Lord Coleraine put down the amendment that we sent to another place and to which your Lordships gave general approval. However, during Report stage and Third Reading, this House was generally concerned—and this concern was expressed (at the last hurdle, as it were) by the noble Lord, Lord Ezra—about when the amendment should begin to bite. The upshot of this was that the noble Lord agreed to withdraw his Third Reading amendment on my noble friend Lady Hooper's promise that the Government would propose an amendment in another place to ensure that no-one who had already got well along the road to enfranchisement by means of first getting an extended lease, should be disadvantaged by the revised valuation assumptions. The route preferred by the noble Lord, Lord Ezra, was that anyone who had applied for an extension lease before the date when my 1046 noble friend Lord Coleraine moved his amendment should be excluded from the new valuation assumptions. This seemed to us to cast the net too wide. However, my noble friend Lord Coleraine indicated during Third Reading that he would be prepared to accept Lord Ezra's formulation if the cut-off date was to be drawn earlier, and he suggested the day after the Court of Appeal's ruling. My noble friend Lady Hooper undertook to consider this matter further. The amendment was successfully moved by my honourable friend the Minister for Housing yesterday in another place and fulfilled this undertaking. I commend it to the House.
Moved, that this House do agree with the Commons in their Amendment No. 4 to the Lords' Amendment No. 3—(Lord Skelmersdale.)
§ Lord Ezra
My Lords, I should like to express my appreciation to the noble Lord, Lord Skelmersdale, and the noble Baroness, Lady Hooper, for having taken account of the points raised in favour of leaseholders who had made their applications in what they considered to be the state of the law at the time. I should have preferred the cut-off date for those applying for extended leases to be 10th October, which was the date on which the amendment was originally moved. Nevertheless, this is an important concession. I am obliged for it, and I am grateful for the change introduced in another place in accordance with the agreement reached here.
§ Lord Coleraine
My Lords, I commend the Commons Amendment No. 4 to your Lordships this afternoon. The amendment which I moved was designed to deal in a fair manner between freeholders and leaseholders affected in correcting a valuation anomaly which arose through careless legislation in 1974. I am most grateful to my noble friend the Minister and to my honourable friend the Minister in another place for seeing my amendment through. I should like also to express my gratitude to the noble Lord, Lord Ezra, for raising points in Third Reading in this House which enabled us to see that there was a small handful of tenants whose claim to enfranchise on the old terms was better than the rest. This amendment gives effect to the claim of these few tenants and I think makes the clause a better clause than when it was first put before your Lordships.
§ Lord Skelmersdale
My Lords, I am most grateful to both noble Lords for their reaction to this Government amendment.
§ On Question, Motion agreed to.