Section 36A: Right of first refusal for local authority, Housing Act 1985

This section applies where, on a disposal of a house under section 32, a discount is given to the purchaser by the local authority in accordance with a consent given by the Secretary of State under subsection (2) of that section; but this section does not apply in any such case if the consent so provides.

On the disposal the conveyance, grant or assignment shall contain the following covenant, which shall be binding on the purchaser and his successors in title.

The covenant shall be to the effect that, until the end of the period of ten years beginning with the conveyance, grant or assignment, there will be no relevant disposal which is not an exempted disposal, unless the prescribed conditions have been satisfied in relation to that or a previous such disposal.

In subsection (3) "the prescribed conditions" means such conditions as are prescribed by regulations under this section at the time when the conveyance, grant or assignment is made.

The Secretary of State may by regulations prescribe such conditions as he considers appropriate for and in connection with conferring on—

a local authority which have made a disposal as mentioned in subsection (1), or

such other person as is determined in accordance with the regulations,

a right of first refusal to have a disposal within subsection (6) made to them or him for such consideration as is mentioned in section 36B.

The disposals within this subsection are—

a reconveyance or conveyance of the house; and

a surrender or assignment of the lease.

Regulations under this section may, in particular, make provision—

for the purchaser to offer to make such a disposal to such person or persons as may be prescribed;

for a prescribed recipient of such an offer to be able either to accept the offer or to nominate some other person as the person by whom the offer may be accepted;

for the person who may be so nominated to be either a person of a prescribed description or a person whom the prescribed recipient considers, having regard to any prescribed matters, to be a more appropriate person to accept the offer;

for a prescribed recipient making such a nomination to give a notification of the nomination to the person nominated, the purchaser and any other prescribed person;

for authorising a nominated person to accept the offer and for determining which acceptance is to be effective where the offer is accepted by more than one person;

for the period within which the offer may be accepted or within which any other prescribed step is to be, or may be, taken;

for the circumstances in which the right of first refusal lapses (whether following the service of a notice to complete or otherwise) with the result that the purchaser is able to make a disposal on the open market;

for the manner in which any offer, acceptance or notification is to be communicated.

Regulations under this section—

may make different provision with respect to different cases or descriptions of case; and

shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

The limitation imposed by a covenant within subsection (3) is a local land charge.

The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant.

Section 36A: Right of first refusal for local authority

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