WolfBite - the key takeaways:
• The Law Commission is an independent body whose function it is to promote the reform of the law of England and Wales to ensure that the legal system is modern, simple, fair and cost-effective.
• The Commission is required by statute to set out, every few years, the topics it considers are in need of reform with a view, ultimately, to making recommendations for Parliament to decide whether to turn into law.
• On 4 September 2025, the Law Commission published its 14th Programme of law Reform, announcing ten new projects it will look at in the next few years.
• The new projects include looking in detail at whether, and if so how, the law could be improved relating to agricultural tenancies, commercial leases, deeds, management of housing estates, and ownerless land.
What is the Law Commission and what does it do?
The Law Commission is an independent body of legal policy experts comprising four teams of lawyers and researchers who focus on distinct areas of law.
The purpose of the Law Commission is to promote the reform of the law of England and Wales.
The Commission’s functions include keeping the law under review with a view to systematic development and reform.
It is required by statute to consider proposals for law reform and to submit to the Lord Chancellor, from time to time, programmes for the examination of different branches of the law.
Through research, analysis and consultation, the Commission identifies areas of the law that might be in need of simplification and modernisation or that have not kept up with social attitudes or technology. Its efforts are directed at areas of the law that most need reform, and changes that will deliver real benefits to the people, businesses, organisations and institutions to which that law applies.
The Commission makes recommendations that will be passed to the Government of the day. The Government will then decide what recommendations to take forward and whether to implement those recommendations fully or partially.
Examples of recommendations from the previous, 13th, Programme that have been or are being taken forward in some form include the Commission’s earlier work on residential leasehold reform, the right to manage and the promotion of commonhold as an alternative to freehold and leasehold ownership.
The Commission is also already in the process of consulting on other important property-related topics, notably the potential reform of aspects of the Landlord and Tenant Act 1954 (LTA 1954) discussed in our Podcast: The LTA 1954 consultation: what it means for commercial landlords and tenants.
The Commission is due to publish its second consultation paper on the LTA 1954 shortly, which will focus on the technical detail of how the legislation might be reformed.
What is of interest in the 14th Programme from a property perspective?
To illustrate how wide the Law Commission’s brief is, the new Programme includes topics such as potential gaps in the law concerning the desecration of corpses and the problems that the defence of insanity causes in practice. As interesting as those topics are, we focus below on the subjects in the 14th Programme that relate to land and property.
Agricultural tenancies
There are two types of agricultural tenancy at the moment, namely pre-1995 tenancies that are governed by the Agricultural Holdings Act 1986, and post-1995 tenancies (farm business tenancies) that are governed by the Agricultural Tenancies Act 1995.
The Law Commission understands that the two regimes may not correctly balance the interests of landowners and tenants, and that the short-term nature of, and minimal statutory protection afforded to, many farm business tenancies is a barrier to investment.
The Commission has also been told that the current law may restrict farmers from diversifying and adapting their businesses, including in more environmentally sustainable ways, such that the law may hinder economic growth and opportunity.
The Commission considers that detailed consideration of how this important area of law could be reformed and improved is “long overdue”.
Commercial leasehold
In addition to the ongoing consultation into the LTA 1954, the Law Commission intends to consult on two-further projects involving commercial tenancies.
The first will look at potential reform of the Landlord and Tenant (Covenants) Act 1995 (LTCA 1995) and the Landlord and Tenant Act 1987 (LTA 1987).
One of the issues with the LTCA 1995 that the Commission likely has in its sights concerns authorised guarantee agreements.
Where a modern commercial lease is assigned, the Act allows the landlord to require the outgoing tenant to guarantee the performance of the obligations in the lease by the incoming tenant. However, there are anti-avoidance provisions that mean that such guarantees can only be taken if in strict accordance with the relevant provisions.The courts have interpreted these provisions as meaning that, if the outgoing tenant had a guarantor, that guarantor cannot also guarantee the liability of the incoming tenant, and nor can the outgoing tenant simply assign the lease to its own guarantor. This can in practice create unnecessary problems and much additional cost, for example where the landlord might be perfectly happy for the outgoing tenant’s guarantor to guarantee the incoming tenant’s liability. This is a particular problem where the tenant is part of a larger group of companies and as part of a restructuring the parent company wants to assign the lease to another company in the same group.
As for the LTA 1987, this legislation contains provisions that require residential leaseholders to be given the “right of first refusal” before their landlord disposes of an interest in the building. Failure to comply constitutes a criminal offence. The relevant legislation has, however, been described by one leading Judge as “ill-drafted, complicated and confused”.
It has been called much worse by many lawyers at the coal face!
One particular issue that we anticipate the Commission will look at is that, as drafted, a landlord of a mixed-use property that wishes to grant a lease of a commercial unit may need to first offer the residential leaseholders the opportunity to take the commercial lease of that unit even though they will rarely, if ever, have any interest or the financial means to do this. Jumping through this bureaucratic hoop adds significant cost and delay to many commercial transactions, serves no useful purpose and was very likely never what Parliament intended. The law could usefully be reformed to address this.
In the second sub-project, the Law Commission will focus on the law governing repair, maintenance and upgrading of rented commercial buildings, there being a concern that the current law causes confusion, unfairness and is not keeping pace with modern priorities such as the need to improve the environmental sustainability of building and to reinvigorate the high street.
As part of this second project, the Commission will consider the law relating to dilapidations, service charges and the interaction between environmental frameworks and existing commercial landlord and tenant law. It may be that there will also be some overlap here with the second phase of the consultation into the LTA 1954.
Deeds
The current law draws a distinction between agreements made by simple contract, and those that are made by deed.
Where an agreement is intended to take effect as a deed, additional formalities apply. A deed must, for example, be in writing, be clearly intended to take effect as a deed and be validly executed, witnessed and delivered as a deed.
The Law Commission considers that the current law surrounding deeds is outdated, in part due to technological developments.
The Commission will therefore look at whether the concept of a deed remains fit for purpose, and whether there should be amendments around the technical requirements relating to witnessing, attestation and delivery of deeds. It intends to look at both deeds executed on paper and electronically.
This is a potentially significant project given that deeds play a crucial role in property law.
For example, most transfers of land and mortgages have to be made by deed, and leases for a term of three years or more must be made by deed. Considerable problems and uncertainties can arise where the formalities for creating a valid deed are not complied with, which quite commonly happens inadvertently or otherwise by mistake.
Management of housing estates
There are already measures within the Leasehold and Freehold Reform Act 2024 which, once brought fully into force, will give owners on freehold estates similar rights to challenge freehold estate management charges to those rights that long residential leaseholders already enjoy to challenge the reasonableness of service charges and administration charges.
However, whilst long residential leaseholders can exercise a no-fault “right to manage” their block of flats, freehold owners on housing estates do not have an equivalent right to take over the management of their estates.
The Law Commission will consider how residents on housing estates, including those which might comprise both freehold and leasehold properties and possibly also both residential and business tenancies, could be given greater control over the management of their estates.
Ownerless land
What happens to land and property when the owner no longer exists is extremely complicated but, unfortunately, commonly encountered in practice.
One particular situation that we see not infrequently is where, for example, a freehold management company of a block of flats has been struck-off the register of companies at Companies
House due to a failure to file accounts, and is then dissolved. This can be a nightmare for the long leaseholders who may face difficulties selling their flats, re-mortgaging, securing a statutory lease extension or enforcing essential repairing obligations.
When an owner is dissolved, its land passes to the Crown which has ancient rights to un-owned goods (called “bona vacantia”).
The Crown will, however, rarely take an active role in relation to the property that passes to it in this way. The Crown will not, therefore, usually perform any act of management such that, in the example given above, the leaseholders will effectively be left without an active landlord.
There are processes through which the original owner might be able to remedy the situation by being restored as the legal owner, or that enable interested parties (such as leaseholders and shareholders) to obtain vesting orders requiring the Crown to pass the property to them. These processes are, however, usually time-consuming and expensive.
The Law Commission considers that the current law is antiquated and confusing, and is an obstacle to returning land to profitable use.
Our thoughts
We welcome the topics that the Law Commission has identified as requiring attention, in particular concerning agricultural tenancies, the right of first refusal provisions of the LTA 1987 and ownerless land.
We regularly advise on the problems that arise in practice in each of these areas, and very much support the view that the current law serves to increase costs, and to delay and sometimes prevent sensible outcomes.
It will take time for the Law Commission to start consulting on the above topics, longer for any recommendations to be put to the Government and longer still for any of those recommendations to become law. It is, however, encouraging that the Law Commission is looking at subjects that cause very real problems in practice, and reassuring that, whilst it may not be quick, the important, detailed, work that it does often results in meaningful reform.
