Defective lease, need some advice

renorawe

GoogleMeNow said:

This is the seller's problem to deal with.  Don't make it yours.

Your solicitor should be raising enquiries about the defective lease and it is up to the seller's solicitor to liaise with the freeholder (or their management company) to agree a Deed of Variation to cover these issues.  That will take time as the seller's solicitor may have to draft the Deed of Variation, the freeholder/management company will want their own legal representative to approve the Deed (there may be amendments going back and forth), plus there will be extra fees which the seller will have to agree and pay. There is a Defective Lease Indemnity Policy, but all it will do is pay your legal costs if you have to sort this out when you come to sell in the future.  Far better to get it sorted it out before you purchase.

Good luck.

Thanks for your advice, it's actually very helpful! 

bouicca21

The simple answer is for the various leaseholders to club together to buy the freehold and reissue the leases.  In practice of course that would be extremely difficult.  

You need to walk away.

eddddy

Just reading through your posts, maybe these comments will help...


Common Areas.
Just to check - are there any common areas/parts of the building? Maisonettes were often built without any common areas/parts.  Presumably your solicitor actually checked the lease plans to see if any common areas/parts of the building exist.


Roof repairs etc
Often with maisonette leases, it works like this

• the upstairs maisonette is responsible for maintaining, repairing and insuring the top half of the building and the roof

• the downstairs maisonette is responsible for maintaining, repairing and insuring the bottom half of the building and the foundations

(So again, there are no areas/parts of the building with joint responsibility.)


Indemnity Insurance.
I suspect it's Contingent Buildings Insurance. 

That's insurance against somebody else (like the leaseholder downstairs) failing to take out buildings insurance. So, for example, if the maisonettes burn to the ground... You have buildings insurance for your maisonette, but the leaseholder downstairs doesn't and cannot afford to rebuild. The indemnity insurance would cover your resulting losses.

But if the leaseholder downstairs has actually told you in advance that they don't have buildings insurance, I doubt that you can get indemnity insurance.


Definition of a "building"
Check with your solicitor - but I'd be pretty sure that when they say "insure the whole building" they mean "the whole vertical part of the building". i.e. 2 maisonettes, rather than 4 maisonettes.

renorawe

Just an update - our solicitor misunderstood a lot of stuff therefore told us a lot of false information but we have spoken to another solicitor and made some progress. It turns out we do not need to insure anything other than our own maisonette and insuring other flats would be pretty much impossible as we can't insure something we don't own. All the lender required was proof that the downstairs had building insurance themselves because if something liked the building burnt down we could have issues if they couldn't afford to rebuild their maisonette. We have been in communication with the owner of the maisonette downstairs who was happy to provide proof that they had buildings insurance which means that the whole building will be insured. 
As for the common parts/areas, there aren't really any so that is why it is not stated in the lease who is responsible. However the roof is the only issue as it doesn't say who is responsible for that. But when we put in our original offer we assumed that the roof would be our responsibility and budgeted for a few updates in the future for the roof and chimney that were deemed not essential but were picked up on by our surveyor. I'm not sure what the situation would be with party walls though that is my only concern really. 

We now know more information but the lease is obviously still defective.

martindow

renorawe said:

We now know more information but the lease is obviously still defective.

... which should be reflected in the price, hopefully.

If you go ahead, this issue will inevitably come up when you wish to sell in the future.