Leasehold charge covenant breach Over 30 years ago

marksmen10

Hi hope someone can help. I purchased a house in 1990 which is leasehold and it had a loft room. I am now in the process of selling the house and during the conveyancing process the leaseholder has stated we had broken a covenant from the 1960,s as permission wasn't sought for this room. They have demanded £750 for this. As the room was already there when we purchased over 30 years ago, is this allowed ? Thanks Mark.

AdrianC

You are the leaseholder. It is the freeholder who has raised the issue.

I presume this covenant does indeed exist?
And there is no record of the freeholder's permission ever having been sought or granted?

Jenni_D

I assume you mean Freeholder? (You are the current Leaseholder).

What does your selling solicitor/conveyancer say? Have you asked them?

Whilst you may be able to avoid the charge, you also need to think pragmatically - any issues with the Freeholder may limit your options for selling.

marksmen10

Thanks Adrian for the correction.The covenant does exist, yet appears to be very unfair as installing double glazing etc would also breach the covenant from the 1960,s. As the loft room was already in place I would assume the solicitor we used in 1990 failed to check for any breaches from the previous owners. The original company that collects the lease fee of £10 per annum has changed hands since 1990, so I am assuming they keep records for over 30+ years to warrant this £750 request ?
Thanks Mark.

AdrianC

marksmen10 said:

The covenant does exist, yet appears to be very unfair as installing double glazing etc would also breach the covenant from the 1960,s. As the loft room was already in place I would assume the solicitor we used in 1990 failed to check for any breaches from the previous owners. The original company that collects the lease fee of £10 per annum has changed hands since 1990, so I am assuming they keep records for over 30+ years to warrant this £750 request ?

Whether you think it's "fair" or not is irrelevant. When you bought the property, you agreed as part of that purchase to abide by them.

I wouldn't know whether your purchase solicitor checked or not - did you ask them to?
Did you keep the purchase paperwork?

It's for you to prove that there was permission. Ultimately, you would need to provide that proof in your defence against a court small claim.

eddddy

marksmen10 said:

I am assuming they keep records for over 30+ years to warrant this £750 request ?
Thanks Mark.

The leaseholder who did the alterations should have got written consent - and passed the consent document on to future owners, and eventually to you. 

To be fair, the freeholder can't prove that a document doesn't exist. You would have to prove that it does exist.


However...

• The law says Administration Fees must be 'reasonable' - freeholders should not make a profit on Administration Fees (such as the fee for giving consent for alterations). In the past, Tribunals have agreed that about £50+vat per hour is a reasonable fee for Admin work.

So for example,

• If granting consent involves 30 minutes work - e.g. adding some notes to a computer system, printing out a consent letter, filing away copies and posting the consent letter to you - maybe a £40 fee would be reasonable.

But for example, if..

• It's reasonable for the freeholder to instruct a surveyor and/or structural engineer to check the alterations
• The lease and/or lease plan needs to be amended
• It's reasonable for the freeholder to instruct a solicitor (e.g. to amend the lease)
• A premium is payable because of the alterations

then those costs can be added on top - which might result in a total of £750.




But some freeholders might feel they have you 'over a barrel', if they know you are selling. They essentially give you a choice of:

• Quietly pay £750 and we'll get the consent done quickly, so your sale can complete quickly.

Or

• Kick up a fuss about the fee. Delay the sale. Scare the buyer because you're in dispute with your freeholder. Potentially lose your buyer

If you do decide to challenge the fee, you'd probably want to:

1. Challenge the £750 fee with the freeholder first
2. If they won't back down, tell them you're paying under protest and you will challenge it at a tribunal
3. Pay the £750 to allow the sale to complete
4. Take the freeholder to tribunal - to try to claim back some of the £750

Titus_Wadd

I don't have anything by way of help or insight but would the timing of the challenge to enforce the covenant be "questionable" - the beach happened over 30 years ago by a previous owner.  If the Freeholder has timed this until they can arm-twist a vendor trying to sell, would that have any relevance on their claim?  How much would the 1980's permission charge have been?  Just asking out of curiosity really, but  I hope you get it sorted OP!