Leasehold Purchase advice when Freeholder doesn't respond

ronnay_barkay

I would be grateful for a bit of help in respect of the issue of trying to contact the freeholder to request information on the process/ cost of purchase of the freehold.

The issue relates to a buy to let property which has a 66yr (from 99) lease left on it.  There is an annual £50 ground rent which is collected by a company based in London.  We understand there is something called an intermediate headlease which is owned by a company in Jersey.  This has to be purchased separately and we have obtained information in this regard.

The freehold has recently changed hands at auction, and is now owned by Richa Gupta Ltd who have a registered address in Derby.  Address obtained from Companies House.  We have written twice to the registered address and heard nothing.  My wife has just spoken to Cash Converters in Derby who appear to occupy the address in question.  Identified through google searches.

The next scenario we were considering was to serve a legal notice in respect of formally requesting the purchase of the freehold.  However, that may well be fruitless if the post is not getting to the registered address.

Other than a speculative door step visit, are there any other legal avenues to pursue?

We were anticipating that this matter may end up at a tribunal.  Is there any advice/ thoughts on that prospect and how much that option may end up taking/ costing?  There must be some way forward when/ if there is no means of actually contacting the freeholder.

Will the leasehold reform act make any difference in this situation.

Thanks for the help, in anticipation.

tacpot12

If mail sent to the registered address isn't getting through, then you might have to go to court. I would observe though that Cash Converters is a franchise and so it is possible that Richa Gupta (who is a director of Richa Gupta Ltd.) works there or owns that business as well. 

I don't think the leasehold reform act will make it any easier if you can't find the freeholder.

You might cause Richa Gupta some problems if you contact Companies House and explain that the business isn't at that address, so it would be as well to do everything you can before reporting the business to Companies House. 

Good luck. 

eddddy

I assume you're talking about the freehold of a house where you are the leaseholder (and not a flat, or a block of flats, or anything else).

There are 2 ways of buying the freehold...

• 1) By informal negotiation - which it sounds like you are trying

• 2) By a statutory process - sometimes called statutory enfranchisement

With an Informal Negotiation you have to reach a voluntary agreement with both the intermediate leaseholder and the freeholder. Neither of them is required to negotiate with you - they are free to ignore you, or say "no", or ask for a silly price, etc.

With the Statutory Route (assuming you qualify), neither the intermediate leaseholder or the freeholder can stop you buying the freehold.

One consideration with the statutory route is that under current laws you have to pay:

1. Your own valuation and legal costs
2. The intermediate landlord's valuation and legal costs
3. The freeholder's valuation and legal costs

That could amount to quite a few thousand.


The leasehold reforms are planned to make these changes to the Statutory route...

• Remove marriage value - which should reduce the cost of your freehold
• Stop you having to pay the intermediate leaseholder's and the freeholder's costs - which should save you a few thousand

Here's some info on the Statutory Route: https://www.lease-advice.org/advice-guide/houses-qualification-valuation/

user1977

ronnay_barkay said:

My wife has just spoken to Cash Converters in Derby who appear to occupy the address in question. 

With what result? They've always been the registered office of the company since it was formed in 2011, so I doubt anything untoward is happening.

ronnay_barkay

Thanks for the replies.  Yes this scenario does relate to a house.

Cash Converters say someone does own the premise they rent and there is a separate post box outside, but dont know the name of who lives above.  I suspect the letters will have been received, but they have chosen not to respond.  

How could you force the situation the situation to court, if we can't be conclusive that the correspondence is being received.  The cost to send a statutory notice is significant.

eddddy

ronnay_barkay said:

How could you force the situation the situation to court, if we can't be conclusive that the correspondence is being received.  

I'm not quite sure what you mean.

But if you continue with the 'informal route', it's all entirely voluntary. You can't take anyone to court.


With the statutory route, you would serve a notice and...

• If the freeholder replies with a counter offer, you negotiate
• If you cannot agree a price with the freeholder, you go to tribunal, and the tribunal decides a price
• Or if the freeholder doesn't reply, you go to county court, and the court lets you buy the freehold

ronnay_barkay

Edddy
Thanks for the reply.  I have been away so apologies for the delay in responding.

I think what we are struggling to determine in this situation, based on the address appearing to be occupied by Cash Converters is whether the post is getting to the Freeholder or whether they are simply choosing to ignore/ not respond.

We were reluctant to serve a statutory notice in case the mail is not getting to the correct destination.  I was trying to contemplate how you would then pursue the matter down the formal route if we cant be sure the correspondence is being received ie. you get no response.  The dilemma in this case comes from the registered address being occupied by a separate business who appear to not know the name/ location of the people we are attempting to contact.
However, at the end of the day, all we can do is serve/ send correspondence to the registered address..

Could I just ask you about another point you raise, which we weren't previously aware of which is County Court?
The tribunal is the formal route to resolve the dispute over the purchase price - clear enough. 
In terms of no reply to the statutory notice, then you mention the County Court route.  What does this entail?  Can this be initiated ourselves, or does a solicitor need to act for us?  Could the process be favourably followed through if the Freeholder doesn't engage/ respond to the process? despite every effort to contact.

We have spoken to a solicitor who mentions an 8 week timescale to respond to a formal notice, but then says "we don't chase up no replies after serving it..."

Ive always felt there has to be some mechanism of a home owner being able to use legal process to buy the freehold when letters/ contact etc isn't being replied to.  

Sorry for lots more questions...

eddddy

You really do need an experienced lease extension solicitor to do a statutory lease extension - especially if there's a possible complication that the freeholder is untraceable.

The solicitor will know the process - so you won't need to know all the details.


FWIW, here are some brief answers to your questions:

ronnay_barkay said:

We were reluctant to serve a statutory notice in case the mail is not getting to the correct destination. 

Typically, you would serve notice on the last address the freeholder gave you.

If the address is out of date, that's not your problem. It's the freeholder's problem. You've correctly served notice.

ronnay_barkay said:

In terms of no reply to the statutory notice, then you mention the County Court route.  What does this entail?  Can this be initiated ourselves, or does a solicitor need to act for us?  Could the process be favourably followed through if the Freeholder doesn't engage/ respond to the process? 

 
Realistically, you would need a experienced specialist solicitor to do this. They would know what to do. The court would order that the freehold is sold to you.

ronnay_barkay said:

We have spoken to a solicitor who mentions an 8 week timescale to respond to a formal notice, but then says "we don't chase up no replies after serving it..."

You need to provide a lot more background and context. Without more information, it's impossible to guess what the solicitor was trying to tell you.

But it's correct that the freeholder has 2 months to respond to a notice. It might not be sensible to chase the freeholder during that period.



As I mentioned above, you should really read this:  https://www.lease-advice.org/advice-guide/houses-qualification-valuation/

Hoenir

tacpot12 said:

If mail sent to the registered address isn't getting through, then you might have to go to court. I would observe though that Cash Converters is a franchise and so it is possible that Richa Gupta (who is a director of Richa Gupta Ltd.) works there or owns that business as well. 

Richa Gupta is a dentist. There's 3 active companies registered at the address. All of which run and operate investment properties.  

ronnay_barkay

Many thanks for all your kind help.  
Onwards and upwards!!

user1977

The point about companies' registered offices is that you are entitled to serve official notices, writs etc at that address - whether they actually read or action any of that correspondence is up to them. But like I said, if it's the address they've always used since 2011, it would seem unlikely that everything is disappearing into a black hole.