Missing Headlease

Mortgage_seeker

I own a ground floor flat within a two-storey building with a flat above. I have titles registered as both the freeholder and leaseholder.
I'm trying to sell my flat and despite having the titles, my solicitor and land registry cannot locate the Headlease.  Despite having sight of the two leases which contain all of the respective covenants and ground rent/service charges, the buyer's solicitor is demanding to see the Headlease (which we cannot locate).
Is there anything I can do to prevent the sale from falling through?

K_S

@mortgage_seekerI've heard from clients about indemnity-insurance for missing head-lease and absent freeholder, but it looks like your scenario is a bit different. Is the buyer's solicitor saying that the purchase falls through if you can't provide the head-lease?

eddddy

So are you saying the ownership structure is:

• Freehold (of the 2 storey building) owned by you
• Headlease (of something???) owned by somebody else
• Lease  (of your ground floor flat) owned by you

How did you come to own both the Freehold of the building and the Lease of your flat? Did you buy them at the same time?

What part of the building does the headlease relate to?

Do you know who owns the headlease? Was the headlease owner contactable when you bought the lease of your flat?

Do you pay ground rent and service charges to the headlease owner?

(Does the headlease owner pay you ground rent and service charges, as you are their freeholder?)



Edit to add...

And is there anything in your lease that makes it unmortgageable or 'problematic'... like a high/escalating ground rent or short time left on the lease?

Mortgage_seeker

Thanks @K_S It's early stages yet as they've just raised it as an obstacle. My solicitor has since suggested that indemnity insurance is a solution as potentially land registry can't find the headlease. Let's see what happens. 

Mortgage_seeker

eddddy said:

So are you saying the ownership structure is:

• Freehold (of the 2 storey building) owned by you
• Headlease (of something???) owned by somebody else
• Lease  (of your ground floor flat) owned by you

How did you come to own both the Freehold of the building and the Lease of your flat? Did you buy them at the same time?

What part of the building does the headlease relate to?

Do you know who owns the headlease? Was the headlease owner contactable when you bought the lease of your flat?

Do you pay ground rent and service charges to the headlease owner?

(Does the headlease owner pay you ground rent and service charges, as you are their freeholder?)



Edit to add...

And is there anything in your lease that makes it unmortgageable or 'problematic'... like a high/escalating ground rent or short time left on the lease?

I own 3 (ground), there is a flat above at 5. I have registered titles for 3 (lease) and 3/5 freehold. I bought both the lease and freehold 12 yrs ago. I'm not entirely sure about the headlease owner - i assumed that was me.  I currently insure and pay for external repairs for the whole building and receive ground rent from no.5.  The lease term is over 900 years and was issued in 1902.

stig

maybe a stupid question but - why do you think there is an existing head lease at all? With only two flats, isn’t it more likely there is simply the freehold of the entire property from which two leases were granted for each of the flats? How is the head lease referred to in the leasehold and freehold papers?

Mortgage_seeker

I might have got confused in the terminology as the buyer wants the headlease. I have copies of the two leasehold agreements for 3 and 5 along with the titles deeds for them and the freehold. They are also registered at the Land registry.

user1977

Mortgage_seeker said:

I might have got confused in the terminology as the buyer wants the headlease.

Then ask your solicitor to clarify, before we start on a wild goose chase...it does sound odd that you'd have been unaware of a headlease even after buying the freehold.

Mortgage_seeker

My solicitor has sent this... 

Yesterday I had some emails from the purchaser’s solicitors asking for the Headlease.  I said the Land Registry have been unable to supply it.  He said ‘I need it, as it is a little strange that it was granted in the first place,'. I said I cannot supply what we simply don’t have but I don’t understand why he feels it is strange as I presume the different titles were originally in separate ownership.  I also said the other flat does not have a copy either.  I pointed out we have the leases for each of the flats and they are the important ones.

I'm trying to contact my solicitor now as I'm getting quite anxious. 

user1977

It would make more sense for you to talk to your solicitor than us, as (as you can tell from the replies so far!) we're even more in the dark than you are.

eddddy

It would be interesting to know what the headlease relates to. Is it the whole building or part of the building or one flat?


Based on what you've said, here are 3 very wild guesses about what has happened:


1) Somebody owns a headlease that's sitting in-between the your leasehold flat, and your freehold building.
The headlease owner is 'absent' - so there are all the risks associated with that. (Similar to the risks of a 'absent' freeholder.)


Or....

2) Your house was part of large freehold title (e.g. of 100 buildings), and there was a headlease (e.g. of just 10 buildings) and then individual leases.

Then somebody did a 'statutory collective enfranchisement' (i.e. buying the freehold) before you bought the property.

That should have removed your building from the original freehold title and from the headlease title. (Which is extra complex, and probably happens very rarely.)

So the buyer's solicitor might be wanting to see the headlease, to make sure your building has been correctly removed from it.

(Also, conveyancing solicitors are generally not 'Collective Enfranchisement' specialists and they might not have seen a complex case like this before, so there may be confusion between themselves about what has happened.)


Or...

3) Your house was part of large freehold title (e.g. of 100 buildings), and there was a headlease (e.g. of just 10 buildings) and then individual leases. 

There have been posts in the past about the freeholders offering to sell the freehold of a building to an individual leaseholder for, say, £300. (And ignoring the headlease)

The leaseholder paid the £300, without taking legal advice, and has ended up in a strange situation.