Access rights - legal interpretation

G_M

Richard_Webster wrote: »

GM's assumption is correct. Positive covenants by freeholders to pay money etc are not binding on successors in title.
........
There is some authority for saying that if the right to use the road is conditional on you making a payment, then you can't use the road if you don't make a payment, and then the fact that you have not covenanted to do so is not so important.. Here the devil is likely to be in the detail. Has the company got power to take action to enforce payment from those who should pay? If so then possibly the enforcement would be to erect a gate and only give keys to those who pay - but this is all very dodgy ground, I'm afraid.

Thanks Richard - this pretty much confirms my understanding, but without resolving the issue. Hence original request for pragmatic ideas!

The conditional aspect had been my hope. It seems legally one-sided, and illogical, that a property owner can rely on a right (access) in a Transfer, but not be bound by an obligation (payment) in that same Transfer.

"the devil is in the detail". What further investigation could the Mgmt Co make to determine whether or not they have "the power to take action to enforce..." as described?

Being "dodgy ground", there is not going to be a definative legal position unless/until it goes to court for an adjudication (and this is likely to be more expensive than the amount in question).

However could the same not be true for any owner denied access? THEY would have to decide whether to go to court (again at expense) to enforce their access right, knowing also that THEY were on "dodgy ground".

This might be enough to bring the two sides together to reach an out-of-court agreeement (eg voluntary contribution towards maintenance costs).

westv

So it's not just freeholds on flats that can be a potential nightmare then if not properly sorted out from the beginning!

G_M

Proposed next step (apologies for length!). Comments?

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The Owner
1, XXXXXXX Mews
Etc

Dear Mrs Bloggs,

Road maintenance
Garden Maintenance

As you are aware, XXXXXXX Mews Management Company currently arranges for garden maintenance, as well as annual clearing of gutters, and some minor repairs to xxxx within the Mews. (+ anything else?)

As you will also be aware, the road, which is owned by the Company, and of which you are a shareholder, is in a state of disrepair and needs resurfacing.

There is also concern within the Mews about parking and security. A security gate and lighting have been proposed.

However over recent years the Company has had difficulty in collecting maintenance charges from a significant number of property owners/shareholders, so the burden of paying for the on-going garden maintenance etc has fallen on a small minority of owners.

The consequence of the above is that under the current system it will be impossible to undertake any improvement work to the road, or to install lighting or a gate, or, indeed to continue the current garden maintenance/repairs etc.

This letter, therefore, is to outline to you the options available for the future of the Mews. It would be appreciated if you could consider these, and let the Directors know your preference as a shareholder in the Company, and as a home owner in the Mews.

Option 1 – the minimalist approach
The Management Company effectively shuts down. As owner of the Title to the road it cannot be dissolved, but under this option it ceases to spend wasteful money attempting to collect maintenance charges from reluctant owners, and ceases to organise repairs, maintenance etc. The road will continue to deteriorate. The gardens will become overgrown. The gutters drains and downpipes will become blocked and rely on individual homeowners to attempt to keep them functioning. Initiatives like lighting and the gate will cease. What funds the Company holds will be returned to those who contributed them, pro rata.

Owners who wish to sell may encounter difficulties as prospective buyers discover the Company is not functioning.

Option 2 – the status quo
Those house owners currently contributing to the Company continue to do so, those who do not, continue to not do so. The current level of garden and gutter/drain maintenance continues, but no additional works are undertaken.

This option, however, is unfairly dependent on the goodwill of a few house owners, which is now unlikely.

Option 3: the legal solution
The current legal ambiguity which results from the way the property Titles were originally set up is resolved. This requires each property owner to make a binding agreement, between the owner and the Company, requiring them to contribute to expenditure. This would mean that all the owners would need to enter into a formal Deed of Covenant which would provide for the upkeep, and for future improvements in the Mews. It would also require future purchasers to sign a similar Deed on sale of any property. The one-off cost per property would be around £X.

This would provide a permanent solution for both current and future owners.

Option 4 – the voluntary contribution
Each home owner contributes voluntarily annually to the Company, allowing on-going maintenance as well as improvements. However, even if achievable in the short term, this would be likely to lead to future problems as any future defaulting would return us to the current impasse, and it would not bind future owners upon sale of a property.

Option 5 – The conditional access
Current funds held by the Company would be used to erect a security gate, with access keys issued to those property owners who made maintenance payments. Rights of access along the Mews are provided for in a Transfer in each property’s Title at the Land Registry (first schedule, [A]), conditional on the maintenance payments (one 26th share) required by that same Transfer (section 2). These Transfers, in each property’s Title, are, however, not binding on subsequent owners (the majority of current owners), thus throwing both access rights and maintenance obligations into doubt.

This option is likely to result in inconvenience and bad feeling. Additionally it is quite possible it would lead to litigation (costly and uncertain to all parties) as owners attempt to pursue their right of access despite non-payment.

Kindly consider the above options carefully, and respond to the Directors at the address given on the enclosed response form, by (date) at the latest. Please note that it is important that all property owners in the mews respond. In the absence of a clear preference by all owners it is likely that option one will be the default option.

A Management Company meeting will be held once preferences have been returned. Please do not hesitate to contact xxxx if you wish to discuss this matter.
Yours sincerely,