(1) Where a value payment is to be made in respect of war damage to a hereditament and at the date by reference to which the disposal of the payment is to be regulated (in this paragraph referred to as "the material date") there was subsisting a rentcharge created out of a proprietary interest (being either the fee simple or a tenancy granted for a term of a hundred years or more) in any land in the hereditament, or in any such land together with other land, a right to receive a share of the value payment shall vest in the person who was the owner of the rentcharge at that date, if he shows that the following conditions are satisfied, namely—
(2) If the said right is exercised—
(3) Any question as to whether the conditions mentioned in sub-paragraph (1) of this paragraph are satisfied, or as to the amount of the said excess pr of the share of the owner of a rentcharge, shall be determined by agreement between the owner thereof and of the proprietary interest out of which the rent-charge was created in the charged land in the hereditament, together with any mortgagee of either of those interests, or, in default of agreement, by reference to a referee as provided by Sub-section (5) of Section nine.
(4) Where the said right is exercised effect shall be given thereto out of so much of the value payment as is payable in respect of the proprietary interest out of which the rent-charge was created in the charged land in the hereditament, and—
(5) Regulations may be made under Section ten (which confers power to make regulations as to claims for payments) as to the exercise of the said right and the manner in which effect is to be given to the said right where exercised, and in particular, but without prejudice to the generality of the power conferred by this sub-paragraph, regulations so made may make provision as to the matters aforesaid in cases in which the charged land in a hereditament is a part only thereof, or was in divided ownership at the material date, or in which a proprietary interest or rentcharge was subject to a mortgage at that date.
(6) As regards cases in which the title to a rentcharge, or to land subject thereto, is registered under the Land Registration Act, 1925, such provision may, without prejudice to the generality of Section one hundred and forty-four of that Act, be made by rules under that Section as may be expedient in cones- quence of the provisions of this paragraph, and in particular for securing (by the imposition of conditions as to the exercise of 1316 said right or otherwise) that the extinguishment of any of a rentcharge by virtue of this paragraph shall not take effect without notice thereof being entered on the register.
(7) In this Act the expression "rentcharge" means a rentcharge (including a fee farm rent) subsisting at law or capable of subsisting at law, and not being an interest or charge arising under a settlement within the meaning of the Settled Land Act, 1925, and means, where an apportionment of a rentcharge binding on the owner thereof has been made, each of the apportioned parts and not the entire rentcharge.
(8) For the purposes of this paragraph the "capital equivalent" of the excess referred to in head (a) of sub-paragraph (1) shall be taken to be that excess multiplied by the number of years purchase which the rent-charge might have been expected to realise on a sale thereof in the open market on the thirty-first day of March nineteen hundred and thirty-nine, if it had been subsisting on that day with the like incidents in all respects as it had at the material date, and the hereditament had been in the state in which it was immediately before the occurrence of the damage thereto, and the annual value of any land outside the hereditament subject to the rentcharge had been its annual value apart from any war damage.
(9) For the purposes of this paragraph the "annual value of the charged land in the hereditament as depreciated by the war damage" shall—
(10) For the purposes of this paragraph the "annual value apart from any war damage" of any land shall, if that land was coterminous with land which constituted a contributory property or two or more contributory properties for the purposes of the instalments of contribution for the year in which the war damage to the hereditament occurred (or, if it occurred before the beginning of the year nineteen hundred and forty-one, for that year), be taken to be the contributory value or the sum of the contributory values of the property or properties for that year, and, if it was not, shall be determined by valuation made by reference—
(11) For the purposes of this paragraph the "available annual value" of the charged land in the hereditament as depreciated by the war damage, or apart from any war damage, shall be taken to be the annual value thereof as so depreciated, or apart from any war damage, as the case may be, less the amount, so far as attributable to any of the charged land in the hereditament, of—
(12) For the purposes of this paragraph the "amount attributable" to any land of a rent- charge, or of rent reserved by a lease, shall, where at the material date that land was the only land subject to the rentcharge, or out of which the rent issued, be taken to be the whole amount of the rentcharge payable, or of the rent reserved, for the year in which that date fell, and, where it was not, shall be determined by apportioning or allocating to that land so much (if any) of that whole amount as may be appropriate, having regard—
(13) In the application of this paragraph to Northern Ireland there shall be substituted for the reference to the Settled Land Act, 1925, a reference to the Settled Land Acts, 1882 to 1890, and, as regards cases in which land in Northern Ireland is subject to a rentcharge, the Lord Chief Justice of Northern Ireland may by rules make such provision as may be expedient for securing (by the imposition of condtions as to the exercise of the said right or otherwise) that the extinguishment of any of a rentcharge by virtue of this paragraph shall not take effect without notice thereof being registered in the proper office for the registration of deeds or titles, as the case may require.
(2) For any reference to a rentcharge created out of the fee simple in any land there shall be substituted a reference to a feuduty or ground annual payable by the owner of the fee simple in such land; references to the owner of a rentcharge shall be construed accordingly, and references to a rentcharge created out of a tenancy shall not apply.
(3) The right conferred by sub-paragraph (1) on a superior or the creditor in a ground annual to receive a share of a value payment shall not be exercisable until—
(4) Where for the purposes of this paragraph a feuduty or a ground annual is required to be allocated or a feuduty or a ground annual or a part thereof so allocated is required to be discharged, the superior or the creditor in the ground annual shall execute and record in the appropriate register of sasines—
I beg to move, "That this House doth agree with the Lords in the said Amendment."
This long Amendment carries out a decision of this House during the Committee stage that the Bill should be amended by enabling owners of rent-charges in certain circumstances to claim a share of a value payment. When the Bill was drafted and passed by this House, it was thought that the rentcharge was normally covered by the site value, but evidence was brought to our notice by several hon. Members interested in this subject that there were many cases, particularly in Lancashire and Northern Ireland, where the rentcharge was, in effect, secured on the building, and if the building was destroyed and not rebuilt, the owner of the rentcharge had a very great claim to be considered in the distribution of the value payment. That principle was accepted in the Committee stage. It was a rather complicated matter to work out in detail, and the Amendment which I now move sets out the machinery.
Briefly, the rentcharge owner is entitled to come in and claim, if the annual value of the damaged property is below the value of the rentcharge secured upon it.' He has also to show that rebuilding is unlikely, because, if rebuilding takes place, he will be back where he was before. If he gets a share of the value payment, that reduces the rentcharge pro tanto. There are very great complexities and I will indicate some of them. A rentcharge may cover several properties, only one of which may be damaged, and you have to arrange for a proportional allocation. There may be different owners of property covered by a single rentcharge. There may be different owners of rentcharge on a single property. The area covered by the rent-charge may not coincide with the Schedule A contributory areas. There may be a mortgage in front of the rent-charge or a mortgage behind it, or the rentcharge itself may be mortgaged. After that brief indication of the complexities, I am sure that the House will realise that this has been a complicated matter.
I do not process to be an expert on rentcharge, and I cannot therefore express an opinion as to how the Amendment will meet those very great difficulties. This matter was brought to my notice by the Law Society, with which I am very closely associated in Manchester, and I cannot allow this Amendment to pass without asking permission to express to the Chancellor and to the Law Officers our deep appreciation of the kindness they have shown us in considering a matter which is of very great importance.
Most of them are consequential or drafting in character. One or two might require a little explanation, but none raises a point of principle and if the House is content to treat them as consequential they could be taken together.
I do not think any of those with which I am dealing and which apply to Part I require explanation unless explanation be asked for. Others affect the Board of Trade, and I do not know whether my hon. and gallant Friend can say the same as I have said.