Breech of Lease with a Coach House

Pigeon56

I bought a coach house 4 months ago with 4 garages underneath. 

In the lease between me & garage 'owners' it stated they had to contribute towards the buildings insurance (which there is a calculation for). 

I sent a letter to each of my neighbours and spoke to them in person but 2 out of 3 are just rude. One neightbour has paid but the other two are refusing as they didnt pay it to the previous owner. I've explained we want to make sure all is in order with the insurance. I've spoken to a solistor but they want £500 to write them a letter but they could still ignore that so i'm not sure if thats the best route to go down. 

Before we bought the property they all acknowleged there was a lease so we thought we would have no problems. It's only £50 each per year but to us 3 times that is £150 which is a big chunk off our insurance premium. 

Any suggestions on what to do going forward would be much appreciated as it's getting to me now. i'm more annoyed they try to ignore me than commuincate their concerns / reasons not to pay. 

canaldumidi

Do you own the freehold?

I'm guessing yes as you are arranging the insurance.

What exactly do their leases say?

If they fail to pay, following correctly served invoices, ultimately you can forfeit their lease and repossess the property (via the courts)

Do you want an additional garage?

https://www.lease-advice.org/faq/i-am-a-leaseholder-of-a-flat-i-have-received-a-demand-for-a-share-of-the-buildings-insurance-premium-do-i-have-to-pay/

https://www.lease-advice.org/lease-glossary/forfeiture/

TripleH

Yes check yours and their paperwork. Think you can ddownload their lease documents from the land registry.

It doesn't matter what historically happened, for all you know they could he telling fibs.

Send a copy of the insurance bill with a covering letter stating that under section x.x x of their lease, they should pay their share of the attached invoice to you.

At this stage don't mention sanctions just your reason for asking for money. It makes you more reasonable than going in heavy handed from the start

pumas

Do the leases specify how the garages may be used? Hopefully nobody is doing anything to invalidate the insurance.

canaldumidi

pumas said:

Do the leases specify how the garages may be used? Hopefully nobody is doing anything to invalidate the insurance.

Ha ha!

https://forums.moneysavingexpert.com/discussion/6337705/restrictive-covenant-on-garage/p1

eddddy

Assuming you're the freeholder

If the lease is well written, it should allow you to recover your legal costs and solicitors bills from the tenants (garage owners).

But you have to make sure you do do whatever the lease says about sending bills, and do everything required by Landlord and Tenant legislation. (e.g. notification of change of landlord etc)


FWIW, it's probably best not to rely on websites like lease-advice.org in this case - they give advice about leases for dwellings. A garage isn't a dwelling, so probably the good news for you is that the 'rules' are less onerous for you (the landlord), and the tenants have less protection.


In general, the route to follow would be something like this:

• Send the tenants a bill for insurance of £50 (or whatever)

• If they haven't paid within, say, 1 month - send a reminder letter - and add an admin fee of £25 to the bill for the extra work

• If they still still don't pay, instruct, solicitors and add the solicitor's fee to the bill

• If they still don't pay, initiate the forfeiture process (i.e. you start the process to repossess the garage)

(But, for example, if it turns out that you didn't issue the bill correctly in the first place, you may not be able to claim the admin fee or solicitor's fee.)




Edit to add...

Hopefully you've made sure that the insurance policy you've taken out is suitable for a house with leased garages underneath.

I've never had to insure a property like that, so I don't know if a 'standard' policy would cover it, or whether you need something more specialist from a broker.

Pigeon56

Thank you for all your advice.

I own the freehold and have sent letters with copies of the lease, the insurance premium (from the insurance company) etc but they still refuse to pay. 

The insurance is through a specialist insurance which deals with coach houses - I did quite a bit of research before purchasing the property. 

I've spoken to a solicitor and they've quoted me £500 + VAT to write them a letter but i'm not sure a letter would be enough. They have said that’s all they can do for me as it's a small fee they wouldn't help me take them to court. (Over a few years though then it wouldn't be classed as a small fee in my opinion). 

There is a section in the lease detailing what can and can't be done in the garages such as car maintenance and play music etc but I have heard them play music on a few occasions but I’m not that bothered by that. 

I think i might ring citizens advice and see what they say before paying £500 for the letter?

I'm not sure if it's worth knocking on the doors of other coach house owners and seeing if they have the same issue? 

caprikid1

"I think i might ring citizens advice and see what they say before paying £500 for the letter?"

Not sure CAB is designed for this, do you have legal cover on your home insurance ?

eddddy

Pigeon56 said:

I've spoken to a solicitor and they've quoted me £500 + VAT to write them a letter but i'm not sure a letter would be enough. They have said that’s all they can do for me as it's a small fee they wouldn't help me take them to court. (Over a few years though then it wouldn't be classed as a small fee in my opinion). 

It sounds like you might have the wrong kind of solicitor.

You need a solicitor who specialises in 'Landlord and Tenant law' - and explain to them that you have a tenant who is breaching a lease covenant, because they are refusing to pay a service charge.


As I explained above, if you do this properly, it won't cost you anything. The garage owner will have to pay all the fees. A good solicitor should explain this to you.

But if you do this wrongly, you might end up having to pay all the fees yourself.

NameUnavailable

Start action to forfeit their leases.

eddddy

NameUnavailable said:

Start action to forfeit their leases.

You can't randomly start actions to forfeit a lease.

The law protects tenants from landlords who do stuff like that.

The OP needs to follow the lease and the law, or the action will fail in court, and the OP will be left to pay their own legal costs and their tenant's legal costs.