107Acceptance of certain surrenders of leases

107 Acceptance of certain surrenders of leases

107 Acceptance of certain surrenders of leases

(1) For the purpose only of enabling a lease, authorised under section 106, or under any agreement made pursuant to such section or by the mortgage deed (in this section referred to as an authorised lease) to be granted, a mortgagor of land while in possession shall, in like manner as if the legal estate were vested in the mortgagor and as against every incumbrancee, have, by virtue of this Act, power to accept from time to time a surrender of any lease of the mortgaged land or any part thereof comprised in the lease, with or without an exception of all or any of the mines and minerals therein, or in respect of mines and minerals, or any of them, and, on a surrender of part only of the land or mines and minerals leased, the rent may be apportioned.

(2) For the same purpose a mortgagee of or person having the benefit of a charge on land while in possession shall, in like manner, and as against all prior or other incumbrancees (if any), and as against the mortgagor or person whose land is subject to the charge, have, by virtue of this Act, power to accept from time to time any such surrender as aforesaid.

(3) On a surrender of part only of the land or mines and minerals leased the original lease may be varied: Provided that the lease when varied would have been valid as an authorised lease if granted by the person accepting the surrender, and on a surrender and the making of a new or other lease, whether for the same or for an extended or other term, and whether subject or not to the same or to any other covenants, provisions, or conditions, the value of the lessee’s interests in the lease surrendered may, subject to the provisions of this section, be taken into account in the determination of the amount of the rent to be reserved and of the nature of the covenants, provisions, and conditions to be inserted in the new or other lease.

(4) Nothing in this section shall, where any consideration (except an agreement to accept an authorised lease) for the surrender is given by or on behalf of the lessee to or on behalf of the person accepting the surrender, authorise a surrender to a mortgagor or person whose land is subject to a charge without the consent of the incumbrancees, or authorise a surrender to a second or subsequent incumbrancee without the consent of any prior incumbrancee.

(5) No surrender shall, by virtue of this section, be rendered valid unless—

(a) an authorised lease is granted of the whole of the land or mines and minerals comprised in the surrender, to take effect in possession immediately or within one month after the date of the surrender, and