solar panel lease contract issues

DKLS

I have had to walk away from two properties recently that had panels fitted and I discovered it was a pain to have them removed, Now I wouldnt ever consider a house with them fitted.

patrick_bs15

The more I read, the more I have my doubts...

ValHaller, even though you're not telling me what I want to hear, I'm glad you're saying it! You're right, I shouldn't make assumptions.

These solar panel arrangements are a BIG can of worms and I'm not sure it's worth it.

DKLS - coming round to your point of view, maybe.

WestonDave

I think First Direct are one of those who are willing to lend on properties with these leased panels on them.

The practical intention of the "lease" is to secure for the solar company the rights to firstly have the panels on the roof (without them becoming your property) for the duration of the FIT contract (25 years). Secondly presumably to be able to have access to them for maintenance purposes etc. The core deal is obviously that they make money from the FIT's which covers their costs in installing the kit - if it stops working then they need to be able to fix it so they can't have you being able to prevent them accessing the roof.

However what the contract actually says requires the whole lease agreement to be reviewed and considered by someone who understands what it should be trying to acheive and who can assess whether it does that without loading extra responsibilities on you.

WestonDave

"'The Landlord grants the Tenant the Rights for all purposes connected with the Permitted Use of the Property'..................?????"

What this is saying is that you as home owner allows the solar company "Rights" (which are probably defined somewhere) for any reasonable reason in connection with the "Permitted Use of the Property" - i.e. running solar panels on the roof. Not necessarily problematic depending on what it says in the "Rights" section.

"The Reservations shall be construed as extending to the Landlord and all persons authorised by the Landlord or otherwise entitled to exercise the Reservations."

There are presumably some limitations (Reservations) which I'd imagine include the right to reasonable notice before they start climbing on the roof etc and what this is saying is that the ability to enforce those limitations can be extended from just you to say your wife or if you had someone looking after the house (e.g. a tenant).

GRANT
The landlord lets with full title guarantee the Property together with the Rights to the Tenant for the Permitted Use for the Term reserving to the Landlord the Reservations"

This sounds more ominous than it is - all the bold part is saying really is that you are the genuine owner and therefore able to enter a contract.

The key to this are going to be what is in the "Rights" and what limitations there are in the "Reservations"

ValHaller

WestonDave wrote: »

I think First Direct are one of those who are willing to lend on properties with these leased panels on them.

The practical intention of the "lease" is to secure for the solar company the rights to firstly have the panels on the roof (without them becoming your property) for the duration of the FIT contract (25 years). Secondly presumably to be able to have access to them for maintenance purposes etc. The core deal is obviously that they make money from the FIT's which covers their costs in installing the kit - if it stops working then they need to be able to fix it so they can't have you being able to prevent them accessing the roof.

However what the contract actually says requires the whole lease agreement to be reviewed and considered by someone who understands what it should be trying to acheive and who can assess whether it does that without loading extra responsibilities on you.

I agree. Although for me it would not be enough that FD were prepared to lend on fitted properties - I would want to be confident that a majority of lenders would be OK with it. Being able to resell is more important than being able to buy .....

WestonDave

True. I did check with FD before I had panels put on my roof but as I was buying them outright (so no lease deal) they were literally totally uninterested. I think there are a good number of lenders who will lend on properties with leased panels provided the lease agreements comply with CML guidance - http://www.cml.org.uk/cml/policy/issues/6229 - OP - this might be worth forwarding to your solicitor.

patrick_bs15

Lots of useful advice and guidance here: many thanks. I won't make a snap decision & will do more homework myself (& get my solicitor to do some too!)

Weston Dave - I'll definitely follow up your advice.

patrick_bs15

Based on all the above, here's the email I sent to my solicitor yesterday morning... by the way, does anyone think it would be worth me typing up & posting the whole solar panel lease contract on here? Would take a while to do, but I could do it. Or do people just think I should pull out of buying the property (which of course means I'd incur a hefty financial hit). I'd love to hear from anyone who has leased solar panels on their roof....

............
Have you forwarded a copy of the solar panel lease contract to First Direct to check whether they find the Responsibilities in it acceptable?
If not, I'll photocopy it & do so. I'll phone their mortgage department on Monday to discuss it with them.

Solar Sun 6 Limited is a new company that has never filed accounts.. (check with Companies House,...). There are more than 10 companies with similar names.... That sounds dodgy to me. Is it in your opinion? (Groupon have 94% off vouchers for Paul O'Brien Solar... also makes me dubious).

More importantly, Paul O'Brien Solar Installations Limited (who installed the panels) was dissolved in 2012 (check with Companies House, free...)
PAUL O'BRIEN SOLAR INSTALLATIONS LIMITED
ARCLIGHT HOUSE
3 UNITY STREET
BRISTOL
BS1 5HH
Company No. 07334082

Status: Dissolved 18/09/2012

That's having never filed accounts.

You need to do some digging on my behalf, please, to establish whether Solar Sun 6 Limited is actually a properly functioning company which would meet its side of the Responsibilities in the lease fully.

Also, I am aware that re-sale of the property could be made more difficult because of this issue. But I think there are a good number of lenders who will lend on properties with leased panels provided the lease agreements comply with CML guidance - http://www.cml.org.uk/cml/policy/issues/6229 . This is from the link: 'CML and BSA have produced joint guidance for providers on what lenders will typically seek comfort on before consenting to the lease of roofspace. The guidance includes a template letter which can be used by the panel providers to confirm to lenders that their lease complies with the minimum requirements set out in the guidance. At this stage, the guidance applies to England and Wales only.'

Please establish whether the lease complies with CML guidance. If it does, then re-sale is not an issue as far as I'm concerned.

Despite doing homework online about the Rights (for others) and Responsibilities (for me, my lender and any buyer when I sell) created by the lease agreement, I'm still unclear. I do not expect any advice in the domain of the solar panel technology itself. However, the lease creates rights and obligations within the existing framework of property law. You have been retained to advise and conduct a purchase within this framework and I can see no reason for you to wash your hands of the legalities surrounding the solar panel lease. I understand that solicitors have different areas of expertise, but it is still an aspect of conveyancing. Further guidance from you over what the Rights / responsibilities set out in the lease mean in plain English is essential for me to proceed with the purchase (please consult with colleagues thoroughly if needed). I have returned a copy of the contract to you promptly to enable you to so.

wymondham

Your solicitors response is poor - if they don't know they should find out?

patrick_bs15

Hi - yes, I agree.
I went round to the estate agent (on whose recommendation I used that solicitor) and asked her to 'have a word' tomorrow! Politely though: I don't think putting the solicitor's back up is going to help at all.

To be fair, the solicitor has done an excellent job in all other respects and I can even understand her reluctance to advise me in this aspect (after all, this Feed in tariff legislation is relatively new plus solar panels are a product, not specifically part of the building).

However, just saying to me that I need to make sure I'm happy with the solar panel agreement myself is not acceptable.