Leasehold reform and buying freehold now

eddddy

So it's back to the email/letter I suggested earlier - which essentially says...

• "Are you sure you want to charge me £3000 to apply for consent?"

• "If you do, I'll pay it under protest and challenge it at a tribunal"

• "If a tribunal agrees that's unreasonable - you'll end up having to give me the money back, and paying the surveyor and solicitor out of your own pocket"

And don't offer any compensation, because if you offer to pay, you cannot challenge it later. . And make it clear that you are not agreeing to any payment. Any payment is being made under protest.

Flipjango

Thanks for all the help.I'm definitely taking it all on board but I've also decided to get some external legal advice from another property solicitor. My conveyancer is about as useful as a wet sock. I think i'd be better spending a few hundred quid on some legal advice than giving a few thousand to the freeholders solicitors. But I agree, if I do have to go ahead, then I will be taking this to a tribunal if I can later as well. 

eddddy

Flipjango said:

 I've also decided to get some external legal advice from another property solicitor. My conveyancer is about as useful as a wet sock. I think i'd be better spending a few hundred quid on some legal advice than giving a few thousand to the freeholders solicitors. 

OK - but I very strongly suspect that your freeholder is just playing a game with you. Probably something like this:

• The freeholder has paid their solicitor about £100 to write a scary letter to you

• The solicitor hasn't read the lease or looked at the lease plan

• The solicitor has simply picked the number £3000 out of the air

• The freeholder hopes that you don't understand that it's just a game, so you pay £3000

And a couple of other things...

• Did you tell the freeholder that you needed this for a sale and/or you needed it quickly? If so, the freeholder probably thinks they have you 'over a barrel' - so might be even more difficult.

• Asking you to make an 'offer' for the compensation was a smart legal move. If you make an offer, of say, £2000 you cannot later challenge it at tribunal. But if it's them that tell you to pay £2000 - then you can challenge it at tribunal.

If it was me, and I suspect that somebody had paid a solicitor £100 to send me a daft letter, I wouldn't respond by spending £500+ on legal advice.

I would reply with words to the effect of "Stop being ridiculous, or I'll take you to tribunal".

NameUnavailable

As your neighbour is up for buying the freehold I would just ignore the 'breach' conversation and press ahead with the process to purchase the freehold.

eddddy

NameUnavailable said:

As your neighbour is up for buying the freehold I would just ignore the 'breach' conversation and press ahead with the process to purchase the freehold.

The problem is that could take 6 to 12 months - and the OP has a buyer who wants to proceed now.

Also the alleged 'breach of lease' issue will complicate things...

• Buying the freehold won't make any difference to the freeholder's claim for compensation

• If the freeholder rushes ahead with enforcement action for breach of lease - they might be able to exclude the OP as a participating tenant

• The tribunal might take a dim view, if they think the OP is using the statutory freehold purchase legislation as a way of avoiding enforcement action for breaching the lease. (Because Parliament didn't intend the legislation to be used as a way of avoiding enforcement. But I'm not sure if the tribunal can veto the purchase on that basis.)

Flipjango

Would taking over Right to manage make any difference? it seems that under right to manage, the management company also takes over giving licences. Whist they have to notify the landlord of breaches, it seems they don't have to ask permission to grant licences. So therefore,  they could also issue a retrospective licence which would rectify the breach, right? 

eddddy

Flipjango said:

Would taking over Right to manage make any difference? it seems that under right to manage, the management company also takes over giving licences. Whist they have to notify the landlord of breaches, it seems they don't have to ask permission to grant licences. So therefore,  they could also issue a retrospective licence which would rectify the breach, right? 

Again, the key question is... "Do the external walls belong to the freeholder?"

An RTM company cannot give you consent to cut holes in the freeholder's walls (if the lease doesn't allow it).


(And more generally, it will be much easier to challenge a £3000 admin charge at a tribunal, than to go through the complex process of setting up a RTM.)

Flipjango

eddddy said:

Flipjango said:

Would taking over Right to manage make any difference? it seems that under right to manage, the management company also takes over giving licences. Whist they have to notify the landlord of breaches, it seems they don't have to ask permission to grant licences. So therefore,  they could also issue a retrospective licence which would rectify the breach, right? 

Again, the key question is... "Do the external walls belong to the freeholder?"

An RTM company cannot give you consent to cut holes in the freeholder's walls (if the lease doesn't allow it).


(And more generally, it will be much easier to challenge a £3000 admin charge at a tribunal, than to go through the complex process of setting up a RTM.)

Are you sure? I'm looking at the guidance notes on the leasehold advisory service, notably section 20 here https://www.lease-advice.org/advice-guide/right-manage/ which seems to say otherwise. 

"Most leases contain provisions requiring the consent of the landlord to certain actions by the leaseholder; these can include sub-letting, assigning the lease and making alterations to the flat. The power to issue such approvals passes to the RTM company, although the company must keep the landlord informed. Before granting any such approval, the RTM company must give notice to the landlord:

• for approvals relating to assignment, sub-letting, placing a charge on the unit, parting with possession, making structural alterations or improvements or changing the use of the unit, the RTM company must give 30 days’ notice."

Seems there is a big difference between keeping the landlord informed and asking their permission. 

And setting up a RTM company would be relatively simple-  there are only 2 of us and I've set up many Ltd companies before so know how it all works and could do it in a couple of hours. 30 days notice and we're up and running which would allow us to save our sale, which we definitely couldn't do by taking the issue to a tribunal. 

Don't get me wrong, I still think your approach is a great idea, but as the landlord doesn't seem particularly reasonable, I would like to have some certain alternatives. 

eddddy

Flipjango said:

Are you sure? I'm looking at the guidance notes on the leasehold advisory service, notably section 20 here https://www.lease-advice.org/advice-guide/right-manage/ which seems to say otherwise. 

"Most leases contain provisions requiring the consent of the landlord to certain actions by the leaseholder; these can include sub-letting, assigning the lease and making alterations to the flat. The power to issue such approvals passes to the RTM company, although the company must keep the landlord informed. Before granting any such approval, the RTM company must give notice to the landlord:

• for approvals relating to assignment, sub-letting, placing a charge on the unit, parting with possession, making structural alterations or improvements or changing the use of the unit, the RTM company must give 30 days’ notice."

To avoid any confusion, I'm fully aware of the page you're quoting from - I've re-read it many times over the years, and I fully understand it and agree with it.



Now back to your situation...

We've already covered this stuff - from multiple angles. So I'll try again using different words, and I'll try to explain it more simply...

• Your lease (almost certainly) doesn't give you the right to cut holes in other people's walls - with or without consent.

• But your lease does give you the right to cut holes in your own walls - with consent

Therefore...

• The RMT company could potentially give you consent to cut holes in your own walls 

• The RMT company cannot give you consent to cut holes in other people's walls

So if the external wall belongs to the freeholder, the RMT company cannot give you consent to cut holes in it.


You really need to get your head around this. The issue of who owns the external wall is the most important issue. Everything else depends on that.