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    • JonClay
    • By JonClay 15th Oct 16, 10:51 AM
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    JonClay
    Problem with an illegible lease
    • #1
    • 15th Oct 16, 10:51 AM
    Problem with an illegible lease 15th Oct 16 at 10:51 AM
    Hi there

    We are about to purchase a property and it has just come to light that the lease is illegible. Apparently it is the only copy in existence and is the same one that has been lodged with the Land Registry.

    The vendor's solicitor claims that the lease is readable, but it really isn't! Our solicitor sent us a copy - it's 15 pages long and at least a third of those pages have only half the text showing. It really looks as though it had been photocopied by a blind monkey in the dark!

    Naturally we are uncomfortable with progressing the purchase until we have a more legible copy of the lease. However, if another copy doesn't exist then we can't have one.... and there goes the vicious circle....

    A couple of potential solutions have come to light which I've shown below. I was wondering if anyone else has experienced this situation and what was done to resolve it (or otherwise)?

    1. The flat is of a type that is very common in the area. We've been told that the majority of leases for such flats are the same. Could we use a copy of a lease from another flat (maybe the first floor flat - we're buying the ground floor)?

    2. Ask the vendor to purchase an indemnity policy to cover us against issues / financial loss on parts of the lease that we cannot read?

    Oh, and purchasing the freehold of the property is not an option!

    Many thanks
    Jon
Page 1
    • G_M
    • By G_M 15th Oct 16, 10:59 AM
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    G_M
    • #2
    • 15th Oct 16, 10:59 AM
    • #2
    • 15th Oct 16, 10:59 AM
    1. Why stop at the lease from another local flat? Why not do some research, and find a lease which has the most favourable terms for the leaseholder irrespective of the location of the flat?



    2) I'd be surprised if this were possible - ask your conveyancer. And what if the issue that later arose was not financial? eg no pets and the freeholder made you get rid of your rottweiller? (I suppose you could claim the vet's bill for putting Huggy down).
    • JonClay
    • By JonClay 15th Oct 16, 11:01 AM
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    JonClay
    • #3
    • 15th Oct 16, 11:01 AM
    • #3
    • 15th Oct 16, 11:01 AM
    Ha ha..... if only solution 1 would work

    Yes, solution 2 does sound unlikely to me too, although I did read somewhere that someone had actually done that.
    • davidmcn
    • By davidmcn 15th Oct 16, 11:25 AM
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    davidmcn
    • #4
    • 15th Oct 16, 11:25 AM
    • #4
    • 15th Oct 16, 11:25 AM
    1. Why stop at the lease from another local flat? Why not do some research, and find a lease which has the most favourable terms for the leaseholder irrespective of the location of the flat?
    Originally posted by G_M
    Not something you can legally rely on, but such things do tend to be in near-identical formats and for practical purposes it at least gives you a better idea of what you're missing (or possibly will help you interpret a particular squiggle).

    2) I'd be surprised if this were possible
    I don't see why not, you can get insurance against much more risky things. A quick search suggests the insurers offer missing and/or illegible deed cover.
    • penguingirl
    • By penguingirl 15th Oct 16, 11:59 AM
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    penguingirl
    • #5
    • 15th Oct 16, 11:59 AM
    • #5
    • 15th Oct 16, 11:59 AM
    Who is the freeholder? Do they have a copy of the lease? If they don't, then surely they couldn't pursue you for any breaches of it as neither party would know what is/isn't allowed? I'm assuming that information such as the length of lease and the rate is legible.
    • bouicca21
    • By bouicca21 15th Oct 16, 12:33 PM
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    bouicca21
    • #6
    • 15th Oct 16, 12:33 PM
    • #6
    • 15th Oct 16, 12:33 PM
    In the same situation with no other copy of the lease available, the management company agreed to issue a new lease in the same terms as for similar leases in the building. This was to be at vendor's expense so an allowance was made against the purchase price.
    • JonClay
    • By JonClay 15th Oct 16, 12:36 PM
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    JonClay
    • #7
    • 15th Oct 16, 12:36 PM
    • #7
    • 15th Oct 16, 12:36 PM
    Thanks everyone - all great answers.

    Bouicca21 - I'd never thought of that, thank you. I intend to "have it out" with the Estate Agent today so I will suggest that.
    • bouicca21
    • By bouicca21 15th Oct 16, 1:05 PM
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    bouicca21
    • #8
    • 15th Oct 16, 1:05 PM
    • #8
    • 15th Oct 16, 1:05 PM
    It's the solicitor you need to talk to.
    • Irratus Rusticus
    • By Irratus Rusticus 15th Oct 16, 4:38 PM
    • 134 Posts
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    Irratus Rusticus
    • #9
    • 15th Oct 16, 4:38 PM
    • #9
    • 15th Oct 16, 4:38 PM

    The vendor's solicitor claims that the lease is readable...

    Naturally we are uncomfortable with progressing the purchase until we have a more legible copy of the lease.

    The flat is of a type that is very common in the area.


    Ask the vendor to purchase an indemnity policy to cover us against issues / financial loss on parts of the lease that we cannot read?
    Originally posted by JonClay
    Naturally you are uncomfortable. Wow, Jon, you really haven't studied the true horror and minefield that is leasehold, have you?

    Doubt there is an indemnity policy that covers half of a lease and all that could be construed therein - at the expense of the gullible lessee. Even if there is, can't see how any tribunal could interpret your covenants and obligations or rights when the inevitable grief hits.

    The vendor's solicitor isn't acting for you. Ask them to write out what they think the lease says. Then laugh in their face.

    Why by all that is sane are you even considering buying this flat?

    Please tell me your solicitor has advised you to avoid like the plague? There's got to be alternative flats. Leasehold is nightmare enough.

    PS. No managing agent can just issue a lease that they 'knock up' from a neighbour's version. Wouldn't that make for an interesting leasehold world. This problem is one for the vendor to sort before selling. They could go to a Tribunal about the lease and see what happens. If they bought a half-legible lease that is their mistake. They should maybe pursue their solicitor. They are supposed to tell the buyer what the lease says.

    Mind you, if the freeholder is willing to serve you a legally signed and sealed and registered new lease for 999 years at a peppercorn rent and no onerous obligations such as prior consent to change the toilet roll or to assign on, maybe you could consider it. The lessee can't do that. The MA can't do that. And the freeholder would be daft to do it.
    Last edited by Irratus Rusticus; 15-10-2016 at 4:46 PM.
    • bouicca21
    • By bouicca21 15th Oct 16, 7:54 PM
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    bouicca21
    Well I'm living proof that it is possible to come up with a solution. What is more problematic is whether the mortgage lender is going to find the solution acceptable and that may well depend on the ltv.

    Bear in mind that without a legible lease the flat is more or less unsaleable. The vendor has every incentive to sort it out.
    • Irratus Rusticus
    • By Irratus Rusticus 16th Oct 16, 2:17 AM
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    Irratus Rusticus
    Could we use a copy of a lease from another flat (maybe the first floor flat - we're buying the ground floor)?
    Originally posted by JonClay
    As a bare minimum:-

    At the vendor's expense search the land registry to verify evidentially to your own satisfaction - not just taking assurances but establishing eyes-on fact - the size of the freehold title and how many leases exist on it.

    Every leasehold address shows a freehold title and a leasehold title.

    If your lease shows a legible freehold title number, all good. Buy that title's register extract for £3. If not buy the neighbour's version.

    Scan down to the Schedule of Notices of Leases and write down each leasehold title you see there.

    Now pay £12 (?) and order one of them. Check the apportionment schedule for the service charges. Does the percentage match the number of leases? If yes, you now know how many leases exist on the title from two sources and that the apportionment is not fixed on size of demise but by the number of flats.

    Now buy ALL the leases - not just their title extract.

    Read carefully. Very carefully. Are they the same in every respect and every clause except for where they describe each demised flat? Is there any variation at all? Watch out for over-typed additions such as garage versus parking space. You don't want to lose a garage or end up paying for others if you didn't originally have to.

    What about the original terms and the ground rent?

    Does 'your' illegible lease reveal 'your' flat's original term and ground rent? The leases may not have been commenced at the same time. Far from it. Your lease may have been extended. Or the others. New leases may have been issued for the neighbours' flats or deeds of variation tagged on the end of the original. Check it all.

    Only if satisfied you KNOW your original lease was/is the same as the others, then maybe consider agreeing to the landlord company cobbling a new version for your flat - but I'm fairly certain that will need signing and sealing as a 'new' lease just with a shortened term. I could be wrong. Don't forget, you will want to be able to sell this dog's dinner eventually.

    If there is only one other flat on the freehold title your task, should you accept it, will be easier.

    I still wouldn't touch it personally, mind. Even if the vendor pays. Don't automatically expect your conveyancing person to have a clue what the lease ought to have said. It will be you left holding the baby. Make sure it is yours.
    Last edited by Irratus Rusticus; 16-10-2016 at 2:30 AM.
    • martindow
    • By martindow 16th Oct 16, 12:04 PM
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    martindow
    I'm wondering if the problem could be a rather faded lease that has been badly photocopied. Is it possible the seller's solicitor has something that is readable but the copy your solicitor has received is illegible?

    If so, a bit of fiddling with the settings on the copier may produce something that can be read.
    • JonClay
    • By JonClay 16th Oct 16, 12:20 PM
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    JonClay
    Unfortunately not, Martin. The vendor's solicitor says that the copy that they have is the same.

    There MUST (hopefully) be a more legible copy somewhere. Whilst the flat is from around 1900, the lease is from 1984 so surely an original must still exist? Minefield!!!
    • deannatrois
    • By deannatrois 16th Oct 16, 12:25 PM
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    deannatrois
    Yes, I'd be asking for a more readable copy if this is even slightly possible. Even a few more words will help give clues as to what is missing, together with the other ideas mentioned already.

    A magnifying glass (seriously) could help also.

    I've also seen these references.., depending on how much other ideas cost, perhaps these could be worth investigating

    http://siarchives.si.edu/services/forums/collections-care-guidelines-resources/help-making-documents-more-legible

    https://forums.adobe.com/thread/1276308

    I wonder (from these links) if a combination of getting as good a copy of the original as you can and a photoshop expert working on it will help.
    • JonClay
    • By JonClay 16th Oct 16, 12:30 PM
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    JonClay
    The problem is that the text has shifted and starts at the centre of the page due to the terrible photocopying. So, the first word is roughly starting at the centre of the page and the sentences trail off half way through. Unfortunately it's not a case of the text size or the text being smudged etc. - it's more of a problem that half the words just aren't there
    • Irratus Rusticus
    • By Irratus Rusticus 16th Oct 16, 2:03 PM
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    Irratus Rusticus
    The problem is that the text has shifted and starts at the centre of the page due to the terrible photocopying. So, the first word is roughly starting at the centre of the page and the sentences trail off half way through. Unfortunately it's not a case of the text size or the text being smudged etc. - it's more of a problem that half the words just aren't there
    Originally posted by JonClay
    And your solicitor doesn't mind this?

    As for 1900 property, probably a freehold title only until conversion into leasehold flats so there will not be older leases - and even if they existed they wouldn't help anyway. But suggests to me you may have a small freehold - one property - with a couple of flats. Makes research easier.

    Forgot to mention above that just using other flat's lease won't work because the critical part (well, it's all critical...) of a lease is the schedule that describes in detail with reference to a plan the demised "Said" flat and any parking space or garage, bin stores etc. You are not planning to live in the neighbour's flat!

    The lease is your only contractual document that describes that you have the legal lease to X flat in X freehold. Please understand that the lease is all you are buying. Not the flat.

    Recently read of a bunch of lessees who discovered they can't sell their flats because they were originally issued the wrong leases. They all hold each others' leases!

    The lease is not an interchangeable document.

    Mind you, once when helping lessees go to tribunal (tribunals require copies of leases) one flat discovered - years into its existence - that the nicely bound copy of their lease was one central page shy. Checking all the other leases I could see the page was identical in all leases and didn't contain any adaptable clauses. The page number was the same. The clauses were numbered in sequence etc.

    As the page-shy lessee knew they did not have any variation post-original, they could use a copy of the missing page. The fact that the missing page contained significant legal covenants binding on the lessee had somehow skipped a row of conveyancing solicitors' eyes that the page numbers in the lease were not sequential. I didn't have to buy another copy off the LR.

    Maybe they don't really read them?
    Last edited by Irratus Rusticus; 16-10-2016 at 2:09 PM.
    • bouicca21
    • By bouicca21 16th Oct 16, 8:52 PM
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    bouicca21
    If it is a conversion then there is a good chance that the leases aren't similar because the flats themselves aren't similar. In my case it was a purpose built block and all the flats were identical, the one thing that was different about mine was that being ground floor part of the garden was demised to it, and that bit was actually legible.

    Do you need a mortgage and if so what is the ltv? If you need a sizeable mortgage it is unlikely that anything you can do will satisfy the bank. The vendor will need to sort it out.

    Mine was an extremely stressful purchase. It came right in the end but I really should have walked.
    • StumpyPumpy
    • By StumpyPumpy 16th Oct 16, 9:19 PM
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    StumpyPumpy
    Unfortunately not, Martin. The vendor's solicitor says that the copy that they have is the same.

    There MUST (hopefully) be a more legible copy somewhere. Whilst the flat is from around 1900, the lease is from 1984 so surely an original must still exist? Minefield!!!
    Originally posted by JonClay
    If it were me I'd make the sale conditional on having a fully readable leasehold document with a transcript signed off by the freeholder otherwise I'd walk away.

    It isn't your job (and by extension, not your solicitor's) to hunt out a readable lease, it is the vendors problem and you don't want it to become yours if you subsequently want to sell. Someone must have a readable copy else how can the lease be enforced?

    You say that the lease is from 1984 and I assume that the length of the lease is readable. Let's say it states at the top that it is for 125 years. What if the lease has a clause stating that the lease is extendible to 999 years for a charge of £1 if the lessee meets some criteria that you happen to, but that part is illegible now? The fact that part of the document is unreadable makes it as hard to prove a clause like that is not there than to prove it is.

    Ok, I know that is an extreme and implausible example, but not totally impossible: I know of at lease one house built on church land whose lease had a clause stating that no ground rent was payable if the lessee was a member of the cloth.

    SP
    Come on people, it's not difficult: lose means to be unable to find, loose means not being fixed in place. So if you have a hole in your pocket you might lose your loose change.
    • martindow
    • By martindow 17th Oct 16, 9:53 AM
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    martindow
    The problem is that the text has shifted and starts at the centre of the page due to the terrible photocopying. So, the first word is roughly starting at the centre of the page and the sentences trail off half way through. Unfortunately it's not a case of the text size or the text being smudged etc. - it's more of a problem that half the words just aren't there
    Originally posted by JonClay
    Doesn't this mean that if the leases for the other flats are very similar (assuming they are readable) that would allow the paperwork for your flat to be reconstructed? I would think it is up to the vendor to sort this out.
    • steampowered
    • By steampowered 17th Oct 16, 10:01 AM
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    steampowered
    Might the freeholder have a better copy?

    The vendor should try getting in touch with the freeholder, at least.

    Perhaps the freeholder will be willing to reissue a copy of the lease, in the same terms as the other leases, if the vendor pays their legal costs in doing so (I can't imagine this would be too expensive).
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