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Deed of Variation to lease-costs

Hi
We have agreed a sale on our 2-bedroom masonette. (It is the 1st floor of 2). We have already agreed to pay for a couple of indemnity policies to rectify issues with the lease. These have cost £500.

We thought all was agreed and we were ready to exchange/complete. But buyers solicitor came back to us on Monday and said that the lease is defective as;

- There is no provision for enforcement of disputes regarding the lease
and
- The responsibility for the foundations are not included in the lease of either our property or downstairs and nor are the freeholder included in the lease as responsible.

We have asked the freeholder whether they are prepared to alter the lease. So far we have received the reply below;

At this stage the Landlord has indicated that they would be prepared to enter into a Deed of Variation to cover the enforcement proceedings but I am still awaiting their confirmation on the point relating to the foundations. However they have indicated that their costs for entering into any such Deed would be £1,500 plus their Solicitors fees in the region of £1,000 plus VAT

This cost seems very high, especially since it isn't even covering both alterations to the lease.

Sorry for all the questions, but I wasn't involved in the original purchase as it is my girlfriend's flat which she bought 6 years ago. I'm just trying to avoid additional stress as she's pregnant and we are really keen to move to a new house which we have agreed to purchase. I'm just really fed up with this whole process. It just seems like we're being penalised and paying all these additional costs for something that is not really our fault.

What would any of you do in our circumstances? It looks like we're

a) Going to be paying an excessive amount to rectify things that should have been done properly to begin with (that's even if we get landlord agreement)
or b) Stay where we are and look at a protracted wrangle with freeholder/landlord/solicitors

Would we have a case of negligence against the original solicitors used by my girlfriend when the purchase was made?

What are our options? And what would you advise?

Thanks for any advice
F
«1

Comments

  • blckbrd
    blckbrd Posts: 454 Forumite
    As far as I understand it, where a lease is silent on a matter of responsibility then the onus usually remains with the freeholder.
    If the lease refers to landlord responsibility for the structure then it could be easily argued that such includes the foundations. However, the lease will also indicate the lessee’s responsibility to contribute to any repair costs. I’ve not encountered any foundation problems that don’t relate to subsidence which can be humongously expensive to rectify. Check your buildings insurance on the issue as it may be claimable although often an excess of £1k (ime) applies.
    As far as your sale goes, the MA/freeholder know you need this sorted out asap and have you over a barrel. Whether you pay the fee or not, resolution may not be timely enough to suit your prospective buyer. Really, you need your own legal advice on the matter - ask how much it‘s likely to cost to carry out any sale negotiations and weigh that against rectification costs.
    You may be time barred from claiming against your girlfriend’s original solicitor if it was more than 6 years ago but there are lots of factors involved in when the clock starts ticking so again get proper advice.
    Good luck!
    Opinion, advice and information are different things. Don't be surprised if you receive all 3 in response. :D
  • Fire_Fox
    Fire_Fox Posts: 26,026 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    I wasn't aware you needed to lay down dispute resolution in the long lease, the Landlord-Tenant Act 1985 covers the right to go to a Leasehold Valuation Tribunal. Admittedly my long lease says we can appoint a RICS arbitrator but I don't believe that overrides my right to use an LVT.

    Is your current conveyancing solicitor an expert in leasehold properties? Have you read the LEASE website to see if this issue is covered, if not have you spoken to their free telephone advice line?
    Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️
  • clutton_2
    clutton_2 Posts: 11,149 Forumite
    £2500 ??????????? outrageous - i paid £275 for a Deed of Variation a few years back for the freeholders solicitors fees to read the new clauses in the LEase and to reply back. i suspecti would have paid about £350 to my solicitor for reading the lease, making amendments and corresponding with the freeholder.

    is this a sign of things to come ????
  • Yes, I thought it was an awful lot of money. They realise that we are trying to sell and can disrupt things if we don't agree. The other issue they haven't as yet consented to adjust the lease for the foundations issue. Paying them for this goes against all common sense, but we risk the chain falling apart if we don't.

    I don't suppose threatening to take them to trading standards or another professional body would help?

    The other thing is there are no provisions in either lease for dispute enforcement or the foundations, therefore I am assuming that downstairs will come across a similar problem if they try and sell.

    Do we have the option of going to the LVT and asking for a complusory variation? Has anyone on here any experience of that, and how much will that cost us? I realise that it may take time and we risk losing our buyer, but the only other option is to be screwed over by a greedy landlord having been stitched up in the first place by a neglient solicitor.

    AGHHHH, So frustrating....
  • Fire_Fox
    Fire_Fox Posts: 26,026 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    edited 23 October 2009 at 2:43PM
    A lot of the answers about reasonable charges, and right to use LVTs under different circumstances will be here:
    http://www.lease-advice.org/publications/
    Edited to add: variation of a long lease is covered under 'Application to the Leasehold Valuation Tribunal', but it's worth reading the entire site!
    Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️
  • I wasn't aware you needed to lay down dispute resolution in the long lease, the Landlord-Tenant Act 1985 covers the right to go to a Leasehold Valuation Tribunal. Admittedly my long lease says we can appoint a RICS arbitrator but I don't believe that overrides my right to use an LVT.

    Nothing to do with LVT.

    Normally the landlord/freeholder maintains the structure and insures. However sometimes the lessee has an obligation to do this in respect of just his flat. If that is the case then lessee A needs to be able to go to the landlord and request him to take action against Lessee B for not maintaining his part of the building. Normally the lessee would be required to pay the costs of this to the landlord. Some older maisonette leases do not have this landlord covenant in them so the landlord will agree to a deed of variation for £1,500 (rip off) since it is no detriment to him as the lessee will still have to pay the costs of the enforcement - but that's the way some landlords are!

    The CML Handbook requires such an enforcement covenant if any important obligations are those of lessees. It isn't strictly needed in cases where the lessee pays for insurance in the service charge and the landlord insures and maintains the structure and common parts. If this is the case the covenant is not necessary and the buyer's solicitors are being over fussy but if the lessee does have these obligations then the seller's previous solicitors would have been negligent in not picking it up.
    RICHARD WEBSTER

    As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.
  • We pay for our buildings insurance via the landlord.

    We have discovered that the flat downstairs insure their property independently of the landlord.

    Our lease stipulates that we are responsible for the roof, there is no mention of the foundations in either lease flat A or B.

    We have been advised that the landlord will put in the deed of variation for the enforcement covenant for £1500 plus £1000 in legal fees.

    They have yet to come back on the foundations issue.

    What I am trying to establish is;
    1. Why are we being penalised for the enforcement covenant
    2. Will the landlord accept responsibilty for the foundations, and if they do will there be further costs?
    3. Are the original solicitors that were used negligent and since it's around 6 years ago are will likely to be able to reclaim any costs?

    Cheers
    F
  • What I am trying to establish is;
    1. Why are we being penalised for the enforcement covenant
    2. Will the landlord accept responsibility for the foundations, and if they do will there be further costs?
    3. Are the original solicitors that were used negligent and since it's around 6 years ago are will likely to be able to reclaim any costs?

    I've made some general comments but it is difficult to go into it all in more detail without seeing the detailed wording of the definition of OP's flat, the lessee's maintenance and repair covenants, and those of the landlord (if any).
    RICHARD WEBSTER

    As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.
  • Hi
    This is still rumbling on.

    Freeholder will not accept responsibility for the foundations. It has taken him 5 weeks to confirm this which is really annoying.

    They will insert a deed of mutual enforceability into the lease at a cost of £2,500 plus VAT (!!!)to resolve another separate issue.

    The landlord claims that they will not take on additional responsibilty for which they are not currently responsible. Since downstairs are not going to take on any additional responsibility where does this leave us? We feel like we're being totally screwed. We are have responsibility for the roof, but no one wants to put their hand up for the foundations.

    Buyers solicitors are making a huge issue of this and will not accept using indemnity policies to get round this.

    Is there anyway that this can be resolved in the short term bearing in mind that we have a purchase lined up? Is it worth us pulling out and trying to struggle on with our purchase (this would mean renting out the flat for 12 months while this is resolved).

    We have requested the original file from the solicitors that were used at the purchase, but even if we can prove their negligence we are still looking a long wait.

    Please can anyone help

    F
  • Please can anyone help

    There's no magic answer that will just appear I'm afraid.

    Personally I think that while they were nationalising the banks and paying billions of £s they should have quietly nationalised some of these rip off landlords with no compensation - but that's another story!

    Unfortunately landlords know that they have you over a barrel so they rip you off.

    You could try selling the flat at auction and hope that nobody will notice the defects but you would probably not get a good price for it.
    RICHARD WEBSTER

    As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.
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