Freeholders claiming lease is 'incorrect'

CleverFable

Hi, 

I posted around 6 months ago about a Section 20 notice I had received and was contesting due to the cost and type of work. It's a long story but it is still ongoing with not much in the way of resolution!

I had a quick question though, the lease could be seen as being 'ambiguous' (freeholder's words, not mine, I think it's quite clear!) and therefore as part of their defence in favour of them doing the work they have stated that they believe the lease to be incorrect. Is this a defence they can use? 
The lease was originally written by the council in 1989. 
I am selling the property and I have to get this resolved before my buyers will proceed, it's becoming incredibly stressful so any help is appreciated!

eddddy

The way forward depends on what is 'ambiguous' or 'incorrect' about the lease.

In certain limited circumstances, a freeholder or leaseholder can apply to the tribunal for a 'Compulsory Lease Variation' (i.e. compulsory changes to the terms of the lease).

Looking at your previous post, for example,

• if the lease didn't specify anyone as responsible for maintaining the windows, then the tribunal might order a compulsory lease variation to make somebody responsible (i.e. either the freeholder or leaseholder)

• But if the lease says that leaseholders are responsible for maintaining the windows, the tribunal won't order a lease variation to make the freeholder responsible.

• But potentially the leaseholders and freeholder could all agree voluntarily to have a lease variation, that made the freeholder responsible

However, the lease variation should be done before the section 20 consultation starts.



Info on compulsory lease variations: https://www.lease-advice.org/faq/in-what-circumstances-can-i-apply-to-the-first-tier-tribunal-property-chamber-to-vary-my-lease/ 

CleverFable

Thank you. The section 20 consultation has already started so have they missed the boat on attempting to change it? 
Since my previous post I have been in discussions with them and have a lot more information to the whole saga, but I still don't believe that the windows are their responsibility

Clause 3 of the lease, the repair covenant of the freeholders, has specifically had 'excluding the windows' from the building description added by the Council - as the repair covenant is taken from the Landlord and Tenant act 1985 (Schedule 6, 14(2)) I have evidence from previous law cases that this generally takes precedent over demises. Therefore the windows should be excluded from the building and Leaseholders should not have to pay for these as 'building repair' costs. 

The freeholders said in their last response to me that they believe that this clause has been written incorrectly.

I've also seen that when there appears to be ambiguity over wording, for example what ‘windows’ would consist of, you can follow the case of Jumbo King Limited vs Faithful Properties Ltd (1999) that stated to ‘give effect to what a reasonable person would have understood the parties to mean and, in spite of linguistic problems if the meaning is clear it is the meaning which must prevail’. Additionally, you could also apply the Contra Proferentem rule that states that if there is doubt about the meaning of a clause it would be resolved against the party who put forward the clause (i.e. freeholder).

There's many things I can also say against the freeholders but they are not budging and the 'incorrect' lease is their latest attempt. They are also now ignoring any attempt at communication!

ETA - Freeholders are quoting case law to also define the lease, hence me also looking at case law.

eddddy

So the lease apparently says that the freeholder isn't responsible for repairing the windows.

Does the lease (directly or indirectly) say that the leaseholder is responsible for repairing the windows?

CleverFable said:

...as the repair covenant is taken from the Landlord and Tenant act 1985 (Schedule 6, 14(2)) 

Do you mean the Housing Act 1985?

If so, is the freeholder arguing that the "structure and exterior of the dwelling-house and of the building" includes the windows?


It sounds like you have made your comments as part of the section 20 consultation. If you've reached deadlock, you could decide to leave things for the moment - and once you eventually get the service charge bill, pay £100 to challenge it at tribunal as being not reasonable.

Your legal argument would be that the freeholder is not required to repair the windows, so it is not reasonable to include window repair costs in your service charge bill.


The tribunal will look at your arguments and your freeholder's arguments, read the lease, consider the law etc - and decide who they agree with.

You could warn the freeholder that you intend to challenge the service charge bill at tribunal, if you want.

bouicca21

I think this needs to be read in conjunction with the original thread.
https://forums.moneysavingexpert.com/discussion/6418852/large-bill-from-management-company/p1

CleverFable

Apologies yes I meant the housing act. 

As my previous thread has now been linked, parts of the lease are on there however I do now have more information from that first thread in January and I don't really want to bring it all out here as there's a lot. Plus I know a lot more now about it than I did then!

Freeholder is arguing that the windows are part of the structure of the building. Leaseholder has window glass demised to the property however has also been told previously by freeholder that windows are leaseholders responsibility (and leaseholders have replaced their own windows previously). The lease states in the repair covenant that "the council hearby covenants with the tenant as follows - To keep in repair the structure and exterior of the flat of the building (including drains gutters and external pipes but excluding the windows) and to make good any defect affecting this structure.".

Unfortunately as I mentioned in my first post I am selling the property (offer accepted way before the section 20 was issued) and I really need to get this sorted so I don't have the option of sitting and waiting. 

I just wanted to know if freeholders can state a lease is incorrect, when they did not originally write it and no changes have been made since. If deemed incorrect it would be in their favour. I have no experience of this so just looking for some help  

CSI_Yorkshire

Of course they can say it is incorrect, just like you can say it is correct.  That doesn't have legal standing though.

And fwiw, in your reasonable person test I would say that the windows are part of the building.

CleverFable

To be honest I am trying not to go into too much detail as I have said, there is a lot to it, however the reasonable person test is more about what the definition of windows is rather than whether they are part of the building. 

Neither of us having legal standing on who is correct/incorrect would surely lead to the Contra Proferentem rule? 

CSI_Yorkshire

From their side - saying it is ambiguous - yes.

From your side - saying it has a clear definition - no.

eddddy

CleverFable said:

I just wanted to know if freeholders can state a lease is incorrect, when they did not originally write it and no changes have been made since. If deemed incorrect it would be in their favour. I have no experience of this so just looking for some help  

This is all getting a bit philosophical... but a lease cannot really be 'incorrect' in this context. That would be an illogical concept.  If the freeholder is saying the terms of the lease are factually 'incorrect', what 'facts' is it contradicting?


But legislation can modify lease terms - as you've seen, the Housing Act adds implied terms to your lease (but those terms don't seem to mention anything related to windows).

CleverFable said:

Unfortunately as I mentioned in my first post I am selling the property (offer accepted way before the section 20 was issued) and I really need to get this sorted so I don't have the option of sitting and waiting. 

What's the buyer's current view on the s20 situation? Do they know about it?

I suspect that if you tell them, and you expect them to pay the bill, they'd walk away. So you'd end up still owning the flat and potentially having to pay the bill.


One way of dealing with it could be that you indemnify the buyer for all costs related to the s20 consultation. i.e. You sell the flat, and agree that you pay the freeholder for any window/door replacement - and you continue to fight the freeholder, at a tribunal if necessary.

So if you win your fight with the freeholder you pay less/nothing, if you completely lose you have to pay the £14k.


(Although, I notice from your previous post that buying your new place AND paying £14k might not be achievable - maybe you can only afford to do one or the other, not both.)

bouicca21

Inspired by this thread I read my lease.  It makes no specific mention of responsibility for windows (other than keeping them clean).  But I know that when the windows were replaced by the freeholder several years ago, one leaseholder refused to pay and theirs were not replaced.  Some time later the new owner did replace them - at their own expense.

It does seem that there’s a lot of room for interpretation and ambiguity.