Rentcharges Act 1977

JurisdictionUK Non-devolved
Citation1977 c. 30


Rentcharges Act 1977

1977 CHAPTER 30

An Act to prohibit the creation, and provide for the extinguishment, apportionment and redemption, of certain rentcharges.

[22nd July 1977]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Prohibition and extinguishment

Prohibition and extinguishment

S-1 Meaning of ‘rentcharge’.

1 Meaning of ‘rentcharge’.

1. For the purposes of this Act ‘rentcharge’ means any annual or other periodic sum charged on or issuing out of land, except—

a ) rent reserved by a lease or tenancy, or
b ) any sum payable by way of interest
S-2 Creation of rentcharges prohibited.

2 Creation of rentcharges prohibited.

(1) Subject to this section, no rentcharge may be created whether at law or in equity after the coming into force of this section.

(2) Any instrument made after the coming into force of this section shall, to the extent that it purports to create a rentcharge the creation of which is prohibited by this section, be void.

(3) This section does not prohibit the creation of a rentcharge—

(a ) which has the effect of making the land on which the rent is charged settled land by virtue of section 1(1)(v ) of the Settled Land Act 1925 ;

(b ) which would have that effect but for the fact that the land on which the rent is charged is already settled land or is held on trust for sale;

(c ) which is an estate rentcharge;

(d ) under any Act of Parliament providing for the creation of rentcharges in connection with the execution of works on land (whether by way of improvements, repairs or otherwise) or the commutation of any obligation to do any such work; or

(e ) by, or in accordance with the requirements of, any order of a court.

(4) For the purposes of this section ‘estate rentcharge’ means (subject to subsection (5) below) a rentcharge created for the purpose—

(a ) of making covenants to be performed by the owner of the land affected by the rentcharge enforceable by the rent owner against the owner for the time being of the land; or

(b ) of meeting, or contributing towards, the cost of the performance by the rent owner of covenants for the provision of services, the carrying out of maintenance or repairs, the effecting of insurance or the making of any payment by him for the benefit of the land affected by the rentcharge or for the benefit of that and other land.

(5) A rentcharge of more than a nominal amount shall not be treated as an estate rentcharge for the purposes of this section unless it represents a payment for the performance by the rent owner of any such covenant as is mentioned in subsection (4)(b ) above which is reasonable in relation to that covenant.

S-3 Extinguishment of rentcharges.

3 Extinguishment of rentcharges.

(1) Subject to this section, every rentcharge shall (if it has not then ceased to have effect) be extinguished at the expiry of the period of 60 years beginning—

(a ) with the passing of this Act, or

(b ) with the date on which the rentcharge first became payable,

whichever is the later; and accordingly the land on which it was charged or out of which it issued shall, at the expiration of that period, be discharged and freed from the rentcharge.

(2) The extinguishment of a rentcharge under this section shall not affect the exercise by any person of any right or remedy for the recovery of any rent which accrues before the rentcharge is so extinguished.

(3) This section shall not have the effect of extinguishing any rentcharge—

(a ) which is, by virtue of any enactment or agreement or by custom, charged on or otherwise payable in relation to land wholly or partly in lieu of tithes; or

(b ) which is of a kind referred to in subsection (3) of section 2 above (disregarding subsection (5) of that section).

(4) Subsection (1) above shall not apply to a variable rentcharge; but where such a rentcharge ceases to be variable, subsection (1) above shall apply as if the date on which the rentcharge first became payable were the date on which it ceased to be variable.

(5) For the purposes of subsection (4) above, a rentcharge shall (at any time) be treated as variable if at any time thereafter the amount of the rentcharge will, or may, vary in accordance with the provisions of the instrument under which it is payable.

Apportionment

Apportionment

S-4 Application for apportionment.

4 Application for apportionment.

(1) The owner of any land which is affected by a rentcharge which also affects land which is not in his ownership may, subject to this section, apply to the Secretary of State for an order apportioning the rentcharge between that land and the remaining land affected by the rentcharge.

(2) The owner of any land which is affected by a rentcharge which does not affect land not in his ownership may apply to the Secretary of State for an order apportioning the rentcharge between such parts of his land as may be specified in the application.

(3) No application for apportionment may be made under this section in respect of—

(a ) a rentcharge of a kind mentioned in section 2(3)(d ) or 3(3)(a ) above, or

(b ) land affected by a rentcharge which also affects other land, if the whole of that other land is exonerated or indemnified from the whole of the rentcharge by means of a charge on the first mentioned land.

(4) Every application—

(a ) under subsection (1) above, shall specify the amount (if any) equitably apportioned to the applicant's land, and

(b ) under subsection (2) above, shall specify the applicant's proposal for apportioning the rentcharge between the parts of his land specified in the application.

(5) Subject to subsection (4) above, every application under this section shall be in such form and shall contain such information and be accompanied by such documents as may be prescribed by regulations.

(6) In any case where the Secretary of State considers that any additional document or information ought to be furnished by the applicant he may require the applicant—

(a ) to deliver to him such documents (including documents of title and, in the case of registered land, an authority to inspect the register), and

(b ) to furnish him with such information,

as the Secretary of State may specify.

(7) Where an applicant's documents of title are in the custody of a mortgagee the mortgagee shall, if requested to do so by the Secretary of State for the purpose of an application made under this section, deliver those documents to the Secretary of State on such terms as to their custody and return as the mortgagee may reasonably require.

S-5 Apportionment.

5 Apportionment.

(1) Where an application for apportionment is made under section 4 above and the Secretary of State is satisfied that he is in a position to do so, he shall prepare a draft order for apportionment of the rentcharge.

(2) If the application is made under section 4(1) above, the amount specified in the draft order as being that part of the rentcharge apportioned to the applicant's land shall be—

(a ) the amount specified in the application as the amount equitably apportioned to that land; or

(b ) where no amount has been equitably apportioned to that land, such amount as the Secretary of State considers appropriate.

(3) If the application is made under section 4(2) above, the amounts specified in the draft order as apportioned between the parts of the applicant's land specified in the application shall be those proposed in the application.

(4) A copy of the draft order shall be served by the Secretary of State on the person appearing to him to be the rent owner or his agent, and, in a case falling within subsection (2)(b ) above, on such persons as appear to him to be the owners of the land affected by the rentcharge.

(5) After service of a draft order on the rent owner or his agent under subsection (4) above, the rent owner may, before the expiry of the period of 21 days beginning with the date on which the draft order is served (or such longer period, not exceeding the period of 42 days beginning with that date, as the Secretary of State may in a particular case allow)—

(a ) object to it on the ground that such an apportionment would provide insufficient security for any part of the rentcharge;

(b ) make an application to the effect that in the event of the apportionment not exceeding the sum mentioned in section 7(2) below, a condition should be imposed under that section.

(6) Where a draft order is served under subsection (4) above on a person who is the owner of any land affected by the rentcharge, that person may, before the expiry of the period of 21 days beginning with the date on which the draft order is served (or such longer period, not exceeding the period of 42 days beginning with that date, as the Secretary of State may in a particular case allow), make representations to the Secretary of State concerning the apportionment specified in the draft order.

(7) Any objection, application or representations under subsection (5) or (6) above shall be made in writing.

(8) An objection under subsection (5) above shall state what apportionment (if any) would in the opinion of the rent owner provide sufficient security for the rentcharge or, as the case may be, part of the rentcharge.

(9) The Secretary of State shall consider any objection duly made under subsection (5) above and any representations duly made under subsection (6) above and, if he is satisfied that the draft order should be modified—

(a ) in the case of an objection, in order to preserve for the rent...

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