From a leaseholder’s perspective, the correct drafting and service of a notice of claim under section 42 of the Leasehold Reform Housing and Urban Development Act 1993 is the most important part of the lease extension process.
If the notice is incorrect then it can prove an expensive mistake because it will be deemed withdrawn and the leaseholder must pay the landlord’s reasonable legal and valuation costs to the date of withdrawal. Furthermore they cannot re-serve another notice for 12 months.
When a Notice is Deemed Withdrawn
Fortunately there are only a few reasons why a leaseholder’s notice would be deemed withdrawn within two months of its service. The first instance would be where the leaseholder fundamentally doesn’t qualify for a lease extension, such as where they have not owned their flat for a period of at least 2 years.
Key issues that can lead to withdrawal:
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The leaseholder has not owned the property for at least 2 years.
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Only one notice under the Act can be in existence at any one time; if a leaseholder doesn’t qualify, they must withdraw the notice to serve a new one once they do qualify.
If they withdraw, they must wait 12 months before serving a new one, even if they qualify sooner.
Invalid Notices that Can Be Re‑Served
Contrast this with a notice that is invalid for failing to comply with Section 42 even though the leaseholder does fundamentally qualify for a lease extension. In this case the leaseholder may simply serve another notice without withdrawing the first. This is because their first, invalid, notice would be treated as a nullity and would not therefore need to be withdrawn before another notice was served.
Important points:
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The 12‑month wait rule does not apply if the notice is invalid in form but the leaseholder does otherwise qualify.
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The leaseholder can therefore serve a fresh notice straight away.
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However, the leaseholder does not escape liability for the landlord’s reasonable costs for having had to deal with the first notice.
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