Right of First Refusal

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    Right of First Refusal

    Hi, I'm desperate to receive some correct information. We are in the process of a leasehold enfranchisement on a block of flats. Anyway, we have reached the stage where our solicitor has notified the freeholder we wish to exercise our right to enfranchise, then our valuer pointed out that if the freehold had exchanged hands and we were not offered first refusal we may now use this ruling to go to court and purchase the freehold at the price it was sold at. Meanwhile I've discovered the freehold did exchange hands in 1997 and none of us were offered first refusal. Is it too late to take advantage of this ruling? Our solicitor seems somewhat reticent. First he said this only applied up to 6 months after the sale. He also says a notification of the new freeholder via the service charge notice was sufficient "notification". I'm beginning to wonder whose side he is on. Anyway can you please let me know where we stand in law if we were not offered first right of refusal in 1986/87 and we are now aiming to purchase the freehold in 2018? Are we able to take advantage of this Ruling to negotiate a better price? Thank you!

    I was advising a friend recently in a similar position to you and came across a podcast on the LEASE website which implies that it may still be possible to force the sale of the freehold to yourselves.

    Of particular relevance in this podcast is everything that is said from c. 10 minutes into the recording. This implies that the receipt of service charge demands from a new freeholder does not qualify as a statutory notice of the freeholder's purchase of the freehold. In fact, the guest speaker in the podcast (a barrister at Tanfield Chambers) goes further to state that he is aware of some developments where leaseholders have managed to force the sale of the freehold to themselves 10 years after the freehold had been sold!



      Thank you Lorimer, this should be interesting - I will list to it right now!!


        And perhaps let your reticent solicitor listen to it.

        It would be good to know how you get on as the friend I was advising has chosen to not do anything further about his predicament. Please update us so that we will all have a definitive answer to this query - which does not come up very often ....


          We are raring to go and were hoping that this point about the First Right of Refusal might help us get a better price for the freehold or somehow push our freeholder into a corner. We have been told that the freeholder might come up with all sorts of stories about how he intended to build another floor or a car park to rent out etc just to bump up his asking price. Our solicitor doesnt really have a clue about this ruling and is trying to avoid it. He sent me an email today saying something along the lines of ...when you signed up I assumed you intended to [straightforward] enfranchise, not pursue the landlord on the basis of the 1987 Act... So clearly he doesnt even "get" it!


            Perhaps it is worth seeking out the Tanfield Chambers person that is on the podcast to get a note of advice from him on your situation.

            You can normally do this via direct access without your solicitor adding a fee for an introduction. I would suggest that if you do this, you do so on the basis that you wish to exercise your right to force the sale of the freehold to yourselves at the same price that it was sold for 'under the radar'. If the sale happened so long ago, you could find yourselves with a rather large windfall.


              Thank you - that would be wonderful. I like the phrase "under the radar" - that's exactly what it was! The leaseholders are holding a meeting this week and we will decide how to proceed. Most likely we need to find a solicitor or as you suggest a barrister who is an expert in this field.


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