Does a freehold invalidate the terms of a leasehold?

Does a freehold invalidate the terms of a leasehold?

by Readers Question

Guest Author

9:51 AM, 7th June 2024, About 4 weeks ago 42

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Hi, two years ago I bought a flat within an Victorian building with several apartments. At the time of my purchase, my flat was leasehold. The cost of building management including service charged was apportioned by percentage, i.e square footage apportionment and I am the smallest apartment.

For example, when I bought the flat the service charge breakdown for a year being £700 for my apartment and £1400 for the larger apartments.

Six months ago, the residents collectively purchased the freehold due to unresolved issues with the previous leaseholder. We are now freeholders under a registered company. However, the directors no longer wish to follow the square footage apportionment method.

My question is: According to the lease, costs are apportioned by square footage. Does transitioning from leasehold to freehold invalidate the lease terms? Are the lease terms no longer valid because 6 of the 9 directors have voted in favor of an equal split of costs, and they are considering this the final decision?

Any help would be appreciated,

Wilde


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Comments

NewYorkie

10:32 AM, 12th June 2024, About 3 weeks ago

This person has zero understanding of tenure. You are all 'the Landlord' and as such, subject to the Act. In addition, you are all leaseholders under the same terms of your original lease.

The issue does come down to what's fair and reasonable, and I suspect a Tribunal would look at what was being paid before, for how long and without question, then wish to know why some of the freeholders decided to change the proportions to benefit those with properties twice the size, at the cost of those with smaller apartments.

Kizzie

15:27 PM, 12th June 2024, About 3 weeks ago

They are all shareholders now and subject to the Memorandum & Articles and the Companies Act 2006 as the registered limited liability company each with £1 voting share,
and separately are Lessees or Tenants of the management co. as a separate covenant in the leases acting on behalf of the Lessor or Landlord. It is the Management co. acting on behalf of the LL which has obligations under the Lease
as well as in addition as a company operating under the companies act 2006 cannot enforce the terms of the lease. It is the Man Co acting on behalf of the LL which enforces the terms of the lease and also must comply with the Landlord & Tenant Act and Commonhold & Leasehold Reform Act 2002.

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