Residential Enfranchisement

The 2001 Act applies to the acquisition of ground rents on residential property in Northern Ireland.

A person paying ground rent has the power to redeem the ground rent on  residential property in accordance with the Act. The redemption may be compulsory. There is compulsory redemption of ground rent of a dwelling house or the property conveyed or transferred is subject to a ground rent and is situated in a compulsory registration area.

The whole of Northern Ireland is now subject to compulsory registration in the Land Registry. The Registrar of Titles will not accept conveyance or transfer for registration until the ground rent has been redeemed. This is an obligation of the purchaser.

The provisions for redemptions are not applicable when ground rent is payable on a lease already extended under the 1971 Act or a proposal for the acquisition of the fee simple has been acquired under that Act; the lease is for less than 50 years; the lease is an equity-sharing lease; the lease is of agricultural land; the lease is a national trust, proceedings are pending for the recovery of the land; the property is a flat.

The ground rent payer who wishes to redeem his ground rent applies to the land registry in the prescribed form. The party must lodge the redemption money latest received for ground rent; evidence of his title; sums to pay; expenses incurred in issuing a certificate of redemption.

After the application is made, the lessee serves a notice on the lessor to the effect that he has applied to redeem the ground rent.

The Registrar may receive claims for monies paid in, on account of ground rent redemption. The superior interest holder may apply to the Land Registry for redemption, payment of the redemption money. He must prove his title.

The superior interest holder must prove his entitlement to the interest. Where there are superior interests, he must enter appropriate arrangements to ensure that the superior lessors receive the appropriate share of redemption money. A decision to issue or refuse a certificate of redemption may be appealed to the Lands Tribunal. When a claim is made by a superior owner for payments of the monies lodged, a certificate is issued or refused as the case may be.

Where the lessee has complied with the requirements, the Registrar issues a certificate of redemption which is sent to him. This certifies the rent has been redeemed and offers full discharge of the ground rent. It is conclusive evidence of redemption. When the ground rent is redeemed, all superior rents are also deemed redeemed. Where the superior rents affect other land, it is only discharged on the relevant property.

The certificate of redemption enlarges the lease interest into a fee simple. The estate of any superior owner is extinguished to the extent that they carry a right to receive the ground rent.

In the case of registered leasehold estates, a certificate of redemption is sufficient authority for the Land Registrar on receipt of the appropriate application to register the fee simple interest as vested in the lessee.

There are different provisions in relation to unregistered title. Where the unregistered leasehold interest is registered as a burden on the registered freehold estate, the freehold interest may be vested in the lessee. In the case of unregistered title, the certificate of redemption is deemed a conveyance for the purpose of the Registration of Deeds Act.

The fee simple interest is deemed a graft on the leasehold interest. It takes effect subject to rights and equities as affected the leasehold interest. Any mortgage of the leasehold interest continues to affect it as if it was a mortgage of the fee simple interest.

Certain covenants continue to exist, notwithstanding the acquisition of the freehold interest.

The procedure for both compulsory and voluntary redemption is similar. In each case, the procedure commences with an application to the Land Registry accompanied by payments of proof of title as above.

The sum for the redemption of the ground rent is the ground rent times a fixed number of years.

The Registrar may only pay out the redemption money if satisfied that the person claiming them is entitled to the money. In most cases, this will be the immediate superior lessor. The onus is on the lessor to agree with any superior interest holders in the proportion that is to be paid to them. There is provision for appeal to the Lands Tribunal against decisions of the Registrar in respect of entitlements to redemption money.

Land may not be repossessed while redemption is proceeding. This covers the period between the initial lodgment of money and the ceiling of the certificate of redemption by the Registrar.

Where multiple properties are held under a single lease, the lessee of one house may redeem the ground rent for all, if the owners do not jointly decide to do so. The Registrar may issue a certificate of redemption to the lessee-occupier even though the others do not redeem the rent. The certificate is not to issue unless the non-redeeming lessees have paid outstanding monies on their share of the cost of redemption.

Covenants which were reciprocally enforceable between the lessee and adjoining owners, in the context of a building scheme, are preserved. Covenants for quiet enjoyment, covenants causing nuisance or interference with facilities and benefits, neighbors are preserved.

This legislation, where it applies, precludes the application of the 1971 legislation.

Agreements which are inconsistent with legislation are deemed void. Provision is made for any superior title owners, affairs being managed, or if he is under a disability. Representatives may deal with matters on their behalf.”