License to Assign - Share of Freehold

nmp

I'm in the process of what feels like a long and drawn out flat sale, I'm paying hand over fist for the legal profession to make photocopies and sit on things. Anyway, getting to the point, I have a sale of a flat with a share of freehold. I've just been told by my solicitor that I am liable for the cost of a license to assign and that will cost me 400 plus vat. Shocked is not the word - never saw that coming!

Can anyone explain to me what this is all about? I thought that as share of freehold, it would just be a transfer of the share certificate.

Please help?

Thanks

nmp

Anybody share any wisdom?

G_M

I'm not that knowledgable about leaseholds but my understanding is

A Licence to Assign is effectively permission to sell the property in question. Licence to Assign is granted by the Freeholder to the current Leaseholder. Where a lease requires a Licence to Assign before the lease can be sold it would be a breach of lease to sell the property without such consent.
(leaseholdguidanceservice)

Since you own a share of the freehold, the licence would need to be granted by all freeholders.

However £400 seems an excessive charge for a simple document. Hopefully Richard will be along with better explanation and cost evaluation.

nmp

Thanks G_M - I spoke to the solicitors who handled the conveyancing when I purchased the my flat, and though they cannot tell me what the cost of the license to assign was ( as i was the buyer that time) they did tell me that I had to sign one. So, it seems that in spite of the property being share of freehold, I do need to complete one. Now its more a question of, is this a realistic price for this work?

thanks

Ulfar

Who is making the charge of £400.00 if you own your share of the leasehold ?

G_M

Ulfar wrote: »

Who is making the charge of £400.00 if you own your share of the leasehold ?

My guess (and only a guess) is that the OP's solicitor proposes to draw up the document and get the various flat owners who jointly share the freehold to sign it.

How is the freehold managed? If informally, the OP could draw up his own licence and get his co-freeholders to sign? I googled this - not sure if it would apply but a bit more investigation....

nmp

Ulfar wrote: »

Who is making the charge of £400.00 if you own your share of the leasehold ?

The 400.00 plus VAT charge is being requested by the solicitors that represent the landlords (the residents association) to complete the license to assign. I'm planning to talk to the residents association to see if they will do that for us for less.

nmp

G_M wrote: »

My guess (and only a guess) is that the OP's solicitor proposes to draw up the document and get the various flat owners who jointly share the freehold to sign it.

How is the freehold managed? If informally, the OP could draw up his own licence and get his co-freeholders to sign? I googled thids not sure if it would apply but a bit more investigation....

Is it feasible to actually do this? or must I pay the solicitors for their charges?

Ulfar

Check your lease this seems to be a bit steep of a charge especially as you own your share of the freehold.

Hold a meeting of the residents association and get this fee waived by voting on it, the £400.00 I think is unreasonable.

Richard_Webster

How many flats in the block? I assume that the freehold is held by a residents' management company that OP has a share in.

If the lease requires that the flat is not transferred without the written licence of the freeholder then it is a question of how that is given. Depending on the precise wording it is quite likely that a simple letter signed by one of the directors on behalf of the company would be sufficient.

What I suspect has happened is that the company has a firm of solicitors acting for it that have said that it is really important that every time a lease changes hands there must be a formal licence to assign which they will arrange at a fee. There may well be some clowns running the company who believe the nonsense their solicitor tells them and so they just go through the jobsworth like process of insisting on a formal licence. It makes me sick that solicitors create unnecessary legal work so they can charge for it.

Problem OP has is getting those running the freeholder company to see that this is (probably) a load of unnecessary paperwork. Unfortunately the solicitors will come up with some probably quite specious argument about how important it is that there is a formal licence so that the incoming lessee signs it to confirm he will keep the terms of the lease, which he will be bound to in any event. (It is only really important so they can charge a fat fee for it.) The likelihood is that those running the company will believe what the solicitors tell them and there won't be any groundswell of opinion amongst other flat owners to get a majority together to remove the directors and replace them with others who are not so gullible.

I recently dealt with a purchase of a flat in a converted house in London where there was wording in the lease requiring the licence of the freeholder to a transfer of the flat. I sent the seller's solicitors a set of enquiries of the kind normally sent to managing agents when a flat is being sold and included a question as to whether consent to the assignment/transfer to my client was agreed. The company replied to the question amongst others and simply said "Yes" in answer to the question about consent! So it can all be done much more easily and cheaply,

sardarji

Richard Webster was acting for the buyer. No doubt permission to assign the lease had been easily agreed, as the seller's solicitor said, of course it would be.
But how much did the seller (via that solicitor) have to pay the solicitor acting for the ground landlord? Mr Webster's comment that it can all be done "cheaply" may be correct (and no doubt was in the case he cites) for the buyer. But was it for the seller?
A seller of a flat worth under £200,000 whom I know has just been asked £375 plus VAT. The Law Society (guess what) thinks this is fine. The ground landlord probably does too--a family "charity" manifestly uninterested (my friend has learned that in earlier matters) in the way the professionals it uses manage or mismanage their work, to the flat-leaseholders' frequent and expensive dismay.
Just how much time does it cost a solicitor to do the necessary documents? An hour? Twenty minutes? The press of a couple of buttons?