Help with purchasing a leasehold flat, practically freehold. No responses on LPE1 form

vtochevska

Thank you so much @Tiglet2 and @yksi, this is incredibly helpful! Earlier this evening I requested information on what the neighbour’s insurance covers and what major works are due or have been done. Maybe you’re right though, this should be coming from my solicitor.  If they cannot confirm the other tenant who is legally obliged to contribute to the cost of the shared area, I believe it would be reasonable for me to ask the seller to cover contingency insurance. 

 @yksi congratulations on your purchase, it sounds like you’ve been through the same hurdle I’m going through! Could you tell me what questions would be most critical from the ones they haven’t addressed? I would appreciate if you clarify what you mean when you say paperwork which will cover me legally. 

Also appreciate the advice on retention moneys, I didn’t know this existed and if they don’t provide information in anything coming up, this might be an option to discuss. 

Thank you!  

yksi

First of all you're welcome and I hope they start making your life much easier. And yes, your solicitor is being paid to get this info. You shouldn't have to chase any information at all. That is her job. "I believe it would be reasonable for me to ask the seller to cover contingency insurance." Backtrack here. It's not you who should ask them. Ask your solicitor what to do if they don't answer the question. She will tell you whether it's needed and who should pay.

Here are some quick examples to covering yourself legally...

Are there any shared assets within the boundary, who has access to them, manholes, private sewers etc
- No problem with the drains.

One week after the sale is completed, your neighbour across the street knocks on your door. There is a problem with the gas main running under your yard. They will need to rip up the concrete on your driveway. Who's paying for it? You didn't know about it, and you can't point the finger at the seller, because you did not get a firm answer to the question. If she had said she was not aware, you'd do more searches to be as sure as you could that this gas main didn't exist. If she had said, yes there is a gas main and it's your responsibility, you might have bought insurance or you might have decided not to buy. 

These answers determine who is legally responsible when something goes wrong.

Here's one from my flat:

Please confirm whether your client is aware of any planned, unbilled or pending major works
- Our client is selling with limited title and has never lived at the property therefore cannot answer this question. Please rely on your own surveys and inspections

If my seller had answered with this, I could have landed myself with an unexpected new roof bill. People mention new roofs all the time as a "worst case scenario" that rarely happens. In my case it really did happen! And I only found out because I had spoken with a neighbour upstairs almost 2 years prior. The agent didn't even know about it until the first sale fell through. The seller didn't know anything and kept saying to go ask the freeholder & management company. The management company would not provide any paperwork, and I had to keep pushing, and saying, I know this new roof is needed, you must have quotes by now, where is the s20 to owners, why haven't you awarded a tender, I need to know when it will be happening and what it will cost me. (Just to clarify: my solicitor did all the pushing and asking. That's her job.)

Your seller can certainly answer this question. Her answer to this question is that she is not aware of any works. She's either aware or she's not aware. Your solicitor needs to force the questions to be answered. If she says she's unaware and it turns out she knew it needed a roof, you can chase her legally for the cost. If she says she's aware, she has to provide info. If she honestly didn't know and the roof then needed replacing, that's your problem (or your insurer). But as you can see, the way the question gets answered decides whose problem the roof will be in future.

vtochevska

yksi said:

First of all you're welcome and I hope they start making your life much easier. And yes, your solicitor is being paid to get this info. You shouldn't have to chase any information at all. That is her job. "I believe it would be reasonable for me to ask the seller to cover contingency insurance." Backtrack here. It's not you who should ask them. Ask your solicitor what to do if they don't answer the question. She will tell you whether it's needed and who should pay.

Here are some quick examples to covering yourself legally...

Are there any shared assets within the boundary, who has access to them, manholes, private sewers etc
- No problem with the drains.

One week after the sale is completed, your neighbour across the street knocks on your door. There is a problem with the gas main running under your yard. They will need to rip up the concrete on your driveway. Who's paying for it? You didn't know about it, and you can't point the finger at the seller, because you did not get a firm answer to the question. If she had said she was not aware, you'd do more searches to be as sure as you could that this gas main didn't exist. If she had said, yes there is a gas main and it's your responsibility, you might have bought insurance or you might have decided not to buy. 

These answers determine who is legally responsible when something goes wrong.

Here's one from my flat:

Please confirm whether your client is aware of any planned, unbilled or pending major works
- Our client is selling with limited title and has never lived at the property therefore cannot answer this question. Please rely on your own surveys and inspections

If my seller had answered with this, I could have landed myself with an unexpected new roof bill. People mention new roofs all the time as a "worst case scenario" that rarely happens. In my case it really did happen! And I only found out because I had spoken with a neighbour upstairs almost 2 years prior. The agent didn't even know about it until the first sale fell through. The seller didn't know anything and kept saying to go ask the freeholder & management company. The management company would not provide any paperwork, and I had to keep pushing, and saying, I know this new roof is needed, you must have quotes by now, where is the s20 to owners, why haven't you awarded a tender, I need to know when it will be happening and what it will cost me. (Just to clarify: my solicitor did all the pushing and asking. That's her job.)

Your seller can certainly answer this question. Her answer to this question is that she is not aware of any works. She's either aware or she's not aware. Your solicitor needs to force the questions to be answered. If she says she's unaware and it turns out she knew it needed a roof, you can chase her legally for the cost. If she says she's aware, she has to provide info. If she honestly didn't know and the roof then needed replacing, that's your problem (or your insurer). But as you can see, the way the question gets answered decides whose problem the roof will be in future.

Thank you so much for the @yksi, I didn't know the difference in the replies was so significant so I obviously need to have a proper chat with solicitor again, as I don't seem to be getting proper advise, we left it at "as long as I am happy to go ahead with these responses, based on the already low price for the flat". It makes perfect sense to require a "I am not aware" answer as I may find out she had been aware, at some point. I am just wondering, obviously they are selling with limited title guarantee, so is she obliged to give a yes or no, or I am not aware answer, or by law she can just respond to everything with "Our client is selling with limited title and has never lived at the property..."?

yksi

Well the answer to that is, are YOU happy with those answers, based on the legal advice your solicitor has given you? Key point is the underline. Make her do her job, which is, to tell you what your liabilities would be, to tick all the boxes and to reassure you. It might be that you don't need all of the answers, but you need to confirm that and you need to understand what each individual one means for you if it's not answered (do I need insurance for this question, do I need to approach neighbours for this one, do we need to conduct another search). And they sure as heck have not responded to all the questions professionally. I was happy with seeing a quote for the roof, because it meant I knew a ballpark figure and my flat was also a very low price. But you're paying this solicitor a lot of money so make sure they earn it - if a solicitor messes up and you have to chase them legally, it's very expensive. 

eddddy

TBH, I think some people might be guessing and/or making assumptions about the lease you're buying.

With a typical lease for a typical flat within a block of flats, the freeholder has many responsibilities - for repairs, maintenance, insurance etc. So you need lots of information from the freeholder.

With a upstairs/downstairs maisonettes, frequently the freeholder has little or no responsibilities. The leaseholders are responsible for repairs, maintenance, insurance etc. So there may be little or nothing that the freeholder can tell you.

Instead, you have to read the lease to see which parts of the building you are responsible for, and you have to get surveys to find out the condition of those parts.

In the circumstances, I think the answers you quote in your original post are probably reasonable, and to be expected - depending on exactly what the lease says.

(I don't know who formulated those questions you quote - but a few of them look like 'trick questions', which no sensible seller would answer.)

Based on your posts so far, I think the key things you need to do are:

• Ask your solicitor to read the lease and confirm to you which parts of the building you are responsible for maintaining and repairing - either singly, or jointly with your neighbour

• Ask your solicitor to read the lease (or read it yourself) to find out who is responsible for buildings insurance. As I mentioned earlier, the insurance situation sounds a bit strange. 
• Ask your solicitor to read the lease (or read it yourself) to determine what responsibilities the freeholder has, if any.
  

vtochevska

Thanks @eddddy, yes we did this yesterday and went through everything which I am responsible for, jointly with the neighbour, it's pretty much what I posted here in one of my earlier posts, the parts of the lease which mention responsibilities. We also went through the restrictive covenants. The part which mentions insurance only states I have to insure with comprehensive policy at all times, which I assume is the same for all leaseholders as I can see the leases were prepared at the same time in the 1950s and the freeholders own two streets there. Obviously it's only an assumption, and lease conditions may have been amended. I do agree however that it would be good to get an answer of "I am not aware" rather than I will not answer this question, wouldn't you agree? I also think the neighbour's insurance policy is really important and have asked for confirmation that hers covers the shared parts. I will be doing my best to work with her on taking a joint policy but I don't know if I should do this now or after I buy, if I cannot do it now then I have to ask for contingency. I hope my thoughts are correct.

davidmcn

vtochevska said:

yksi said:

First of all you're welcome and I hope they start making your life much easier. And yes, your solicitor is being paid to get this info. You shouldn't have to chase any information at all. That is her job. "I believe it would be reasonable for me to ask the seller to cover contingency insurance." Backtrack here. It's not you who should ask them. Ask your solicitor what to do if they don't answer the question. She will tell you whether it's needed and who should pay.

Here are some quick examples to covering yourself legally...

Are there any shared assets within the boundary, who has access to them, manholes, private sewers etc
- No problem with the drains.

One week after the sale is completed, your neighbour across the street knocks on your door. There is a problem with the gas main running under your yard. They will need to rip up the concrete on your driveway. Who's paying for it? You didn't know about it, and you can't point the finger at the seller, because you did not get a firm answer to the question. If she had said she was not aware, you'd do more searches to be as sure as you could that this gas main didn't exist. If she had said, yes there is a gas main and it's your responsibility, you might have bought insurance or you might have decided not to buy. 

These answers determine who is legally responsible when something goes wrong.

Here's one from my flat:

Please confirm whether your client is aware of any planned, unbilled or pending major works
- Our client is selling with limited title and has never lived at the property therefore cannot answer this question. Please rely on your own surveys and inspections

If my seller had answered with this, I could have landed myself with an unexpected new roof bill. People mention new roofs all the time as a "worst case scenario" that rarely happens. In my case it really did happen! And I only found out because I had spoken with a neighbour upstairs almost 2 years prior. The agent didn't even know about it until the first sale fell through. The seller didn't know anything and kept saying to go ask the freeholder & management company. The management company would not provide any paperwork, and I had to keep pushing, and saying, I know this new roof is needed, you must have quotes by now, where is the s20 to owners, why haven't you awarded a tender, I need to know when it will be happening and what it will cost me. (Just to clarify: my solicitor did all the pushing and asking. That's her job.)

Your seller can certainly answer this question. Her answer to this question is that she is not aware of any works. She's either aware or she's not aware. Your solicitor needs to force the questions to be answered. If she says she's unaware and it turns out she knew it needed a roof, you can chase her legally for the cost. If she says she's aware, she has to provide info. If she honestly didn't know and the roof then needed replacing, that's your problem (or your insurer). But as you can see, the way the question gets answered decides whose problem the roof will be in future.

is she obliged to give a yes or no, or I am not aware answer, or by law she can just respond to everything with "Our client is selling with limited title and has never lived at the property..."?

They're not obliged to answer the questions at all. It's entirely up to you what you make of the answers (if any) you get.

vtochevska

I appreciate everyone's opinion and experience on this, I've asked the seller to provide more specific responses and seek information on the two particular issues - maintenance works and insurance, and based on the tone and effort in her next replies I will judge whether this is too much of a risk. I will have to take into consideration the current condition of the property, what information I can get from the neighbour and the types of indemnity insurance which are available for the lack of information. Hopefully I'll come back with good news.  

eddddy

vtochevska said:

I do agree however that it would be good to get an answer of "I am not aware" rather than I will not answer this question, wouldn't you agree? 

It's not really realistic. In a lot of cases you're asking for opinions, and it's dangerous to express opinions in legal contracts.

For example:

• Please confirm with (the managing agent's solicitor) if all maisonettes are leased on leases with similar terms to ours.
• With regard to your letter attached to the replies to the LPE1, please confirm if the seller has been repairing and maintaining the property in conjunction with the neighbour.
• Please confirm that the title plan is an adequate reflection of the property?

With the first question, how do you define "similar"? If one clause is different - is that similar? If five clauses are different - is that similar?

What if the seller says "Yes - the terms are similar".

Then you buy the property, but your opinion is that the terms aren't similar. So you sue the seller, and you both have to hire expensive lawyers to argue about whether the terms are "similar" and ultimately a judge has to decide.

TBH, the most sensible reply to that kind of question is "read the leases yourself and form your own opinion about whether the terms are similar and/or take legal advice from your solicitor about whether the terms are similar."

vtochevska

Update:

The EA has spoken to the other flat's owner who has confirmed everything is shared between both flats - roof, outside walls, foundations etc, and has provided her insurance policy and has confirmed she would consider taking out a joint policy for both flats. I have also ordered the lease for her flat to make sure it's the same as mine with the same expectations from the Lessee, and have asked for the vendor to edit some of her replies to "aware" or "not aware" based on some of this new information from the neighbour.  I"m not sure still if she will do this but it would be good for a bit more clarity. I am still not sure about indemnities as my solicitor is saying that based on the price I am paying them they are only obliged to cover the lender, so the policy they have suggested for about £60 is doing just that and if I would like to take out other indemnities, including chancel I would have to pay extra - he mentioned figures in the range of £700-£800 for the ones I enquired about. I think I might not need these since we will most likely have a joint insurance policy. Based on all of this and the current outside condition of the property which is quite good (except for the inside where I will have to do some work), it doesn't seem that there are any major causes of concern. 

I would appreciate your thoughts.
Thanks everyone!