Freeholder Gone Bust and I can’t Extend my Lease

by Readers Question

11:41 AM, 28th July 2014
About 4 years ago

Freeholder Gone Bust and I can’t Extend my Lease

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Freeholder Gone Bust and I can’t Extend my Lease

I own a flat in a block of six, all six owners have agreed to purchase the Freehold.

The Freeholder was dissolved in 2002, our solicitor has contacted the Treasurys Solicitors Dept, who have replied to say that that companies assets are distributed to persons entitled, no interest was passed to the Crown as bona vacantia, and suggest we continue to look to see who gained entitlement to the freehold.

The Financial Conduct Authority have also been contacted, but no one has any idea who has the freehold.

In the ten years I have owned the flat we have never had a demand for ground rent or maintenance.

Our solicitor seems stuck and the leases have dropped below seventy years making the flats difficult to sell.

Has any one got any ideas what we should do next?

Thanks

CharlieLeaseholder or Freeholder who is responsible



Comments

Brian Phillips

11:47 AM, 28th July 2014
About 4 years ago

has your solicitor done a Land registry search on the Freehold title ? whilst not conclusive, this would show if there had been a legal Transfer of the Freehold and might provide an address

Mark Smith (Barrister-At-Law)

11:52 AM, 28th July 2014
About 4 years ago

This first step should be taken. If there is no transfer to the government then there has been a distribution to someone, who should appear on the LR.

If they do not then please contact me for advice on company restoration.

Yours

Charlie Harper

12:00 PM, 28th July 2014
About 4 years ago

Reply to the comment left by "Brian Phillips" at "28/07/2014 - 11:47":

Thanks for your reply Brian.

In the letter received from The Tresury's Solicitors Dept they state that the Freeholder has failed to transfer the property interest to the Land Registry and suggest we carry on looking.

Tony Lilleystone

12:14 PM, 28th July 2014
About 4 years ago

Check out S26 of the Leasehold Reform, Housing and Urban Development Act 1993 which contains provisions for collective enfranchisement (i.e. acquiring the freehold) when the person who owns the freehold cannot be found or his identity cannot be ascertained.
This does mean going through the statutory process but if the correct procedures are followed the court can make a make a vesting order which would enable you to acquire the freehold title..

Charlie Harper

12:19 PM, 28th July 2014
About 4 years ago

Reply to the comment left by "Mark Smith (Barrister-At-Law)" at "28/07/2014 - 11:52":

Thanks for your reply Mark.

All we have is a letter from the Treasurys Dept saying no interest was passed to the Crown and although they failed to register the interest with Land Registry this will not invalidate the transfer.

The receivers have been contacted but dont keep files going back to 1990 when they were appointed fixed charge receivers. They only state that Meridan (The Freeholder) was a mutual Society but they cant be of any help to us as they dont know who the persons entilled are

Mark Smith (Barrister-At-Law)

12:29 PM, 28th July 2014
About 4 years ago

Ok-

Failing to register means that the LL cannot claim rent etc, and will only hold the freehold equitably.

If you cannot find the LL after the LR search then please contact me further to look at the various options.

Tony Lilleystone

12:30 PM, 28th July 2014
About 4 years ago

Further to previous comment, I should have said that S50 of the Leasehold Reform, Housing and Urban Development Act 1993 covers the situation where you want a lease extension rather than acquiring the freehold.
But that still leaves you with the problem of a missing freeholder, which undermines the whole reason for having leases, so it would be better to think of acquiring the freehold.

Charlie Harper

12:42 PM, 28th July 2014
About 4 years ago

Reply to the comment left by "Tony Lilleystone" at "28/07/2014 - 12:30":

Hi Tony,

We are trying to buy the Freehold! We just dont know who owns it

Mandy Thomson

14:20 PM, 28th July 2014
About 4 years ago

These might be of relevance http://www.landregistry.gov.uk/public/guides/public-guide-16 and http://www.landregistry.gov.uk/professional/guides/practice-guide-4.

If the freeholder can't be traced, I see no other option than for you and the other leaseholders to claim possessory title to the freehold, which I would expect your solicitor to be looking into.

Tony Lilleystone

14:26 PM, 28th July 2014
About 4 years ago

Reply to the comment left by "Charlie Harper" at "28/07/2014 - 12:42":

The purpose of S26 and S50 is to give leaseholders the right to either acquire the freehold or get lease extensions even when they don't know who owns the freehold. (I know it is often very difficult in those situations where it was owned by a company which is now defunct.)
Basically these sections give the court the power to either vest the freehold or grant extended leases (whichever you prefer) once the relevant procedures have been followed. In other words the court takes over the powers of the real freeholder to transfer the freehold or grant the leases.

You have to show that attemopts have been made to trace the freeholder (which your solicitor seems to have been done.) You would have to pay a price agreed by what is now the First-tier Tribunal (Property Chamber). formerly the Leasehold Valuation Tribunal - the money is paid into court.

I suggest that you have a look at the guide on the Leasehold Advisory Service website
http://www.lease-advice.org/publications/documents/document.asp?item=11

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