Solicitor issue with Notice of Transfer

Evelina69

Purchased a property three years ago and received a letter from an investment company saying we owe £421 as the notice of transfer hasnt been served.
Asked solicitor to look into it presuming they should have sorted it.
They are now saying I have to pay it?

eddddy

Just to make sure we're talking about the same thing, is this the case...?

• You purchased a leasehold property 3 years ago - I'm guessing it was a house rather than a flat

• The lease requires that you serve the Freeholder (Landlord) with a 'Notice of Transfer' - but no notice was served

• Freeholders usually charge a fee for dealing with a 'Notice of Transfer' - your freeholder seems to be charging £421 (or does that £421 include a fee charged by your solicitor as well?)

If that's the case, I guess the follow up questions would be...

• Why didn't your solicitor serve the 'Notice of Transfer' 3 years ago - as required by the lease?

• (Or for example, is the solicitor claiming that they served a 'Notice of Transfer', but the freeholder is saying they didn't receive it?)

• Did the fee you paid your solicitor 3 years ago include serving a 'Notice of transfer'? (Most solicitors would include that in their fixed fee - but some 'budget' solicitors might charge it as a separate fee.)

• Did you pay the freeholder's fee for dealing with a 'Notice of Transfer' 3 years ago - and did your solicitor forward that fee to your freeholder?

Other side issues...

• £421 sounds excessive for a freeholder's fee for dealing with a 'Notice of Transfer' - you could think about paying that under protest and challenging it

• Is ground rent payable on your property? Have any bills arrived for ground rent in the last 3 years? If so, was your name on them or the previous owner's name.

Evelina69

Just to make sure we're talking about the same thing, is this the case...?

• You purchased a leasehold property 3 years ago - I'm guessing it was a house rather than a flat (CORRECT)

• The lease requires that you serve the Freeholder (Landlord) with a 'Notice of Transfer' - but no notice was served (CORRECT)

• Freeholders usually charge a fee for dealing with a 'Notice of Transfer' - your freeholder seems to be charging £421 (or does that £421 include a fee charged by your solicitor as well?) (COST FROM FREEHOLDER IS TRANSFER CHARGE £222 & NOTICE OF CHARGE £198)

If that's the case, I guess the follow up questions would be...

• Why didn't your solicitor serve the 'Notice of Transfer' 3 years ago - as required by the lease?

• (Or for example, is the solicitor claiming that they served a 'Notice of Transfer', but the freeholder is saying they didn't receive it?)

• Did the fee you paid your solicitor 3 years ago include serving a 'Notice of transfer'? (Most solicitors would include that in their fixed fee - but some 'budget' solicitors might charge it as a separate fee.)

• Did you pay the freeholder's fee for dealing with a 'Notice of Transfer' 3 years ago - and did your solicitor forward that fee to your freeholder?

Other side issues...

• £421 sounds excessive for a freeholder's fee for dealing with a 'Notice of Transfer' - you could think about paying that under protest and challenging it

• Is ground rent payable on your property? Have any bills arrived for ground rent in the last 3 years? If so, was your name on them or the previous owner's name. (NOT HAD ANYTHING THROUGH THE POST)

eddddy

Evelina69 said:

(COST FROM FREEHOLDER IS TRANSFER CHARGE £222 & NOTICE OF CHARGE £198)

That seems a bit expensive.

Regarding the 'Notice of Charge' - that's usually required if you have a mortgage.

So it's a case of asking the solicitor the follow-up questions that I mentioned above.

It's often the case that the solicitor says they served the notices, but the freeholder says they didn't receive them. So it's then a case of going through records to establish who is right.

EssexHebridean

It does seem expensive, but if that is the cost mentioned in the Lease, or if the cost in the Lease is subject  to revision then that is the cost that was included within the LPE1, then that is the price they charge, and the OP has effectively agreed to it. 

I'd suggest checking the quotation you received from your solicitor, and also the completion statement - do either or both of those mention these costs? If they are included on the completion statement, then there is an absolute expectation that the solicitor should have done the Notice. Regardless, it is as said above a question for the Solicitor as to whether it was done (because as said, they perhaps did, and the Notice was never received) and if not, why not. 

Edited to add - because there is a cost attached to this, even if the solicitor did not notice failure to receive back the signed notices, they certainly should have noticed if their payment bounced back (if paid by cheque which did not arrive, for example) - and there would also still be a credit sitting on your client account at the solicitor's firm, if the Notice payment was simply never sent, but was included on the completion statement). 

eddddy

EssexHebridean said:

It does seem expensive, but if that is the cost mentioned in the Lease, or if the cost in the Lease is subject  to revision...

A fee for a Notice Of Transfer would be an 'Administration Charge'.

I agree that if it is a 'Fixed Administration Charge' specified in the lease, it cannot be challenged.  (But I thought it's  fairly unusual to have 'Fixed Administration Charges' in leases - although I guess you read more leases than I do.)

A 'Fixed Administration Charge' is normally considered to be  one that is "specified in his lease" or "calculated in accordance with a formula specified in his lease."

If the amount is not stated in the lease, it would be a 'Variable Administration Charge'.

EssexHebridean said:

.
..then that is the cost that was included within the LPE1, then that is the price they charge, and the OP has effectively agreed to it. 

That's an interesting point if it's a 'Variable Administration Charge' - but I'm not sure that the legislation backs that up.

The legislation specifically says:

87 Determination of tribunal as to administration charges
...
(4) But an owner of a dwelling is not to be taken to have agreed or admitted any matter by reason only of having made any payment.

Link: https://www.legislation.gov.uk/ukpga/2024/22/part/5/crossheading/administration-charges

So if the Freeholder says "The fee for the notices is £421" and the Leaseholder pays it without comment - that doesn't mean that the Leaseholder has agreed to it. So the amount can still be challenged.

But it depends whether the OP's solicitor said anything to the Freeholder which constituted an agreement to the charge.


FWIW, I recall a tribunal case along the lines of...

• The freeholder said in an email "The charge for abc will be £x"
• The leaseholder replied with an email saying "OK"

The tribunal ruled that replying with "OK" constituted agreement to the charge, so it couldn't be challenged. (Had the leaseholder not replied with "OK" and simply paid the charge, they probably could have challenged it.)

EssexHebridean

That's the crux of it though I suspect - generally speaking a client is going to be asked if they are happy with all charges and fees that have been flagged up to them during the process - so they will have agreed to pay. :-(