Freeholder's sublet fee

misterstingy

I own a leasehold flat which I rent out on Assured Shorthold Tenancies. The company that manages the freeholder's interest has written to me stating that I have to pay a fee every time I find a new tenant.

I have owned and rented out the flat for 9 years and they want to go back to the beginning with retrospective fees.

The only thing I can find in the lease which might allow them to charge a fee reads 'within one month after the date of every assignment death grant of probate or administrative assent transfer mortgage charge sub-lease or other event or document relating to the term hereby granted ...'

(yes it really reads like that, i.e. no commas)

(It goes on to say that I have to give notice to the Landlord, produce a copy of the document to their solicitor and pay a 'reasonable fee').

My question is, what do the words 'relating to the term hereby granted' mean. Obviously my 6 month assured shorthold tenancies don't relate to the whole of the 125 year term of the lease, so does that mean I don't have to comply with this requirement?

davidmcn

misterstingy wrote: »

Obviously my 6 month assured shorthold tenancies don't relate to the whole of the 125 year term of the lease, so does that mean I don't have to comply with this requirement?

No, they are each a sub-lease from your leasehold interest, so they do relate to your term.

mrschaucer

"Within one month of every ... sub lease" (so within one month of your granting someone else an ASHT on your property, every time) you must comply with what your lease requires you to do, which is what is set out for you there - pay the fees etc.
And yes, you are required to do it or you are in breach of your lease.

Yoga_cat

"Assignment" is the bit that means what you do each time you enter into an AST with tenants.

G_M

Yoga_cat wrote: »

"Assignment" is the bit that means what you do each time you enter into an AST with tenants.

Does granting a tenancy really constitute assigning the lease? So the tenant could sell the lease on (for £X00,000)?

davidmcn

Yoga_cat wrote: »

"Assignment" is the bit that means what you do each time you enter into an AST with tenants.

No, assignment is a tenant transferring their interest to another tenant (i.e. selling the leasehold). Granting an AST is a subletting.

G_M

davidmcn wrote: »

No, assignment is a tenant transferring their interest to another tenant (i.e. selling the leasehold). Granting an AST is a subletting.

though to be pedantic, is a lease not assigned in the same way each time it is sold on?

davidmcn

G_M wrote: »

though to be pedantic, is a lease not assigned in the same way each time it is sold on?

I think that's what I said...any transfer of a leasehold interest is an assignment.

Yoga_cat

Ah, okay, so it's "sub-lease" in the quoted clause.

A leaseholder assigning their lease to somebody else would end their interest in the property and could only take place on a sale, is that right?

shortcrust

If I were the OP I'd be none the wiser.

scriv

Have you had a change of freeholder, misterstingy? If so, I don't think they are entitled to claim consent fees etc retrospectively for the time before they acquired the freehold - happy to be corrected of course by those who know better.

Incidentally, the lack of commas is usual in such legal documents. It was explained to me once that it was to prevent confusion!