Freeholder claiming arrears

Freeholder claiming arrears

9:58 AM, 7th October 2014, About 10 years ago 15

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We bought a flat (to let out) in 2012 and for 6 months our solicitors could not get hold of the freeholder, so finally gave up and declared them “uncontactable”.

Early in 2013 the freeholder resurfaced claiming ground rent, building insurance and money for emergency works 6 back to 2007, just by sending a letter giving a summary of all alleged costs, no proper demand. We requested to see invoices, proof that relevant notices have been sent to the previous leaseholder, the freeholder’s company accounts for the relevant periods, etc., but not any of those have been provided. Freeholder claiming arrears

Then early this year they have taken us to small court, but have provided the court with the property address, and not our actual address where we reside. Following the delay in communication a CCJ was issued against us. Following that we have had a hearing and the judgement has been set aside.

We are facing a hearing to determine whether the claimed amounts are payable and we are unsure of how we should proceed.

In the meanwhile, just very recently, the freeholder sold the freehold at auction, and there were special clauses in the auction stating that whoever buys the freehold must cover for the claimed arrears as well.

The case with the old freehold is still on, but we are wondering, would the new freeholder have any rights as to claim from us again?

We have seen no documental proof of expenses made, the previous leaseholder claims nothing was owed at the time of sale.

The freeholder has used a managing agent for a period of time, so we have approached the company and requested the history of the property, but they refused to release any information. Do we have the right to see that as current owners?

Too many questions I’m afraid.

Would appreciate any advice.

Thanks

Slavena Millen


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Comments

Tony Lilleystone

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18:00 PM, 13th October 2014, About 10 years ago

I think AA Properties is referring to the Right of First Refusal contained in the Part I of the Landlord and Tenant Act 1987.
This requires the landlord (usually freeholder) of a block of flats to serve notice of any proposed disposal to 'qualifying' tenants (i.e. the owners of the flats.) The tenants then have the right to buy the freehold under the provisions of the Act.
The detailed provisions of the Act are quite complicated, especially as to who is a 'qualifying' tenant and what constitutes a 'disposal'.
However S10A does state that failure to serve notices is an offence and “A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 5 on the standard scale.” S10A(4) says proceedings for an offence under this section may be brought by a local housing authority.
Perhaps more usefully the Act also says that when a freeholder sells the freehold without having given notices in accordance with the Act then the flat-owners may have the right to force the buyer to sell the freehold to them.
The main problem with this Right of First Refusal is that a 'requisite majority' of the flat-owners need to agree to buy the freehold and be able to act fairly quickly as usually there will only be a two-month period in which the offer can be accepted.
I only encountered one case where this happened, and that was where there were only three flats in the building and the owners were already considering buying the freehold.
Regarding the original query about freeholders raising demands for service charges after many years silence, I would suggest that the questioner has a look at the Leasehold Advisory Service website http://www.lease-advice.org/ which has a lot of useful information about service charges and what information the freeholder must give when claiming payment.
One point which the questioner should look into is whether a claim can be made against the previous owners for any service charges relating to a period before the property was purchased. Normally on the sale of a leasehold property outgoings such as ground rent and service charges are apportioned, i.e. split between seller and buyer, according to the period they relate to.
However there is a provision in the Law Society's Standard Conditions of Sale, which are used in most residential conveyancing transactions, which applies when a sum is not known at the date of completion. (often the case with service charges.) In this case the apportionment is to be made as soon as the sum is known and the seller remains liable to pay any amount relating to the period when he/she still owned the property.

Mark Alexander - Founder of Property118

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18:03 PM, 13th October 2014, About 10 years ago

Reply to the comment left by "Tony Lilleystone" at "13/10/2014 - 18:00":

Thanks for the detailed response, something new I've learned today 🙂
.

Kulasmiley

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23:41 PM, 13th October 2014, About 10 years ago

Yes, thanks Tony, it can be a bit of a minefield.

I have a question.
4 flats, one bungalow.

I have been offered with another leaseholder to buy the freehold from the Crown. I have 2 flats therefore giving me 2 leaseholder permissions, and a majority. The other leaseholder who would become the freeholder with me ONLY wants part of the freehold (which is the ground of his bungalow), and then he wants to give me the other freehold.

1. "What notices may I have to give/receive to other leaseholders before buying the the Crown?"
2. Can this freehold be split between us, (assigned??), or would it be classed as another "sale" to me? (therefore having to give more notices?

????

Kevin

Mark Alexander - Founder of Property118

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10:59 AM, 14th October 2014, About 10 years ago

Reply to the comment left by "AA Properties Wales " at "13/10/2014 - 23:41":

Tony has requested your email address, may I provide this to him?
.

Kulasmiley

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17:28 PM, 14th October 2014, About 10 years ago

Reply to the comment left by "Mark Alexander" at "14/10/2014 - 10:59":

Yes Mark, that's fine, thanks,

Kevin

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