Breach of long lease covenants section 146 of property act 1925

by Readers Question

12:06 PM, 10th February 2015
About 4 years ago

Breach of long lease covenants section 146 of property act 1925

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Breach of long lease covenants section 146 of property act 1925

I have a bought 200 year commercial shop lease for £90,000. At the time of purchase it was tenanted.

I have split the shop into two and let it separately. The freeholder wrote me saying that I have breached the covenants of lease and that I should bring back to its old state within reasonable time otherwise they will go for forfeiture of the lease as it is done without their prior permission. Their ground rent is £100 per year .

Freeholder has agreed to give retrospective consent and asked £300+VAT. It is paid to freeholder. Then his in house solicitor wrote to me saying that offer has expired and the money is adjust towards his fee of £500.

Do I have to demolish the wall and cancel the letting agreement of my tenants?

Many thanks

Syedbreached



Comments

Carol Thomas

17:26 PM, 10th February 2015
About 4 years ago

Hi Syed
I would definitely pay for the retrospective consent as you are definitely in breach and in the wrong. The money it would cost to restore the property could easily overtake the cost of a legal agreement. The sooner you sort this out, the better. Good luck...

David Atkins

17:43 PM, 10th February 2015
About 4 years ago

You should read the lease first!

Mike Amapola

18:00 PM, 10th February 2015
About 4 years ago

Hi , I would strongly suggest that if the freeholder is prepared to give retro consent and you want to continue with the 2nd shop then pay the money asked and put it down to experience. Learning lessons always costs !

Neal Craven

18:02 PM, 10th February 2015
About 4 years ago

Read the lease, if you do need consent you either need that consent or need to revert.

I assume you appreciate if the landlord successfully forfeits (either by court action or peaceable re-entry) you can lose the property

syed naqvi

21:01 PM, 10th February 2015
About 4 years ago

Reply to the comment left by "CaZ " at "10/02/2015 - 17:26":

Thanks for your comment.

I have paid the freeholder £300+VAT for the fee he asked for.
After having got the payment , his in house solicitor wrote me that offer is expired and money is adjusted towards £500. 00 legal fee.

Carol Thomas

21:29 PM, 10th February 2015
About 4 years ago

Hi Syed
I feel that they are being unreasonable, however, they now have you between a rock and a hard place. The best thing you can do is take the advice of previous posters and get some legal advice of your own. Anyone recommended on this site is well worth considering. Personally, I have had involvement with several people on this site and they have been extremely professional. Keep us advised of your progress.

Neal Craven

21:41 PM, 10th February 2015
About 4 years ago

Look up the Leashold property repairs act 1938. It applies to leases over 7 years with more than 3 remaining. I think if the landlord serves a s146 notice the tenant has 28 days to serve notice claiming the benefit of the 38 act and if he does the landlord needs to go to court before he can take further action. Take advice, I am not a solicitor, things may have changed and I don know the details of your case.

AA Properties Wales

1:34 AM, 11th February 2015
About 4 years ago

How would he have to forfeit the property based on a £300 or £800 bill? Ok, he has been a bit naughty and missed a point in the lease (a valid point), but would a tribunal or judge make him lose his property. Is this the same as any covenant, ie if he rented the property out as flats instead of shops, could he really lose the property, the mortgage on it, the lot??

Neal Craven

5:12 AM, 11th February 2015
About 4 years ago

Potentially based on the unauthorised alteration. The cost and process of the grant of the licence to alter is a bit unusual in this case. Normally you would apply to the landlord for conscent and depending on the type of consent required and if the lease contains a reasonableness clause cost and potentially a fee will be agreed. I have seen long leasehold commercial tenants lose property in one case for non payment of a nominal ground rent. I have also see cases where a flat owner was likely to lose his luxury flat as a result of unauthorised alterations. The potential for forfeiture is one of the reasons some people buy reversionary investments. Another reason is fees generated from lease variations.

syed naqvi

13:37 PM, 11th February 2015
About 4 years ago

Thank you all for your comments. I will now take a legal representation for the matter.


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