Retrospective Permission vs Indemnity Insurance: Stud Wall Removal

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    Retrospective Permission vs Indemnity Insurance: Stud Wall Removal

    Hi there,

    hoping for some advice. I purchased my flat in 2016 and in the same year completed a renovation of the property that included the removal of a stud wall between the kitchen and living room, which allowed a much more efficient layout including a larger overall kitchen. Prior to removal of the wall I had a certified structural engineer confirm in writing that the wall was not load bearing and was under the assumption that because of this I could make the change without the permission of the management company.

    Fast forward to today and I'm looking to sell the property. We accepted an offer and as part of the process the question of the wall was raised. the buyers solicitor suggested that the removal of the wall did breach the terms of the lease and in response my solicitor suggested offering indemnity insurance to cover the buyer. The relevant clause of the lease is as follows:

    "Not to make any structural alterations or additions to the demised premises and not to remove cut maim or injure or permit to be removed cut maimed or injured any of the floors walls or timbers thereof or external doors and windows and not to make any alterations which will affect the external appearance of the demised premises or the building"

    Our buyer has since pulled out of the purchase and we are now starting again the process of finding a buyer. We're wondering whether to continue as-is and offer any prospective buyer the same indemnity insurance, or to reach out to the management company to try and obtain retrospective permission (removing our ability to offer indemnity insurance). We're of the opinion that selling the property will be easier with permission, however our big fear is them declining permission and us having to put the wall back, to the detriment of the property and it's sale value.

    I'd really appreciate any insight on what may be the best approach, and any opinion on the likelihood of us being successful with retrospective consent.

    Thanks very much!

    #2
    Unfortunately, I think you unwittingly breached the alterations covenant. On a quick reading it may appear that only structural alterations require consent, but I think the clause has to be interpreted as imposing three separate obligations:

    "not to make any structural alterations or additions to the demised premises”

    not to remove cut maim or injure or permit to be removed cut maimed or injured any of the floors walls or timbers thereof or external doors and windows”

    not to make any alterations which will affect the external appearance of the demised premises or the building"

    There is no easy answer to your dilemma. There is no way of predicting whether landlord or agent or both will see an opportunity to set the cash registers ringing.



    Comment


      #3
      Thanks for replying so quickly Lawcruncher. I had a good dig around the forums before posting and regularly saw your excellent feedback so it's really appreciated, even if it's accompanied with an impending sense of doom.

      My uneducated interpretation of the tricky second clause was that "floors walls or timbers thereof" was referring to 'the structure', as it would be unusual to reference timbers in a non-structural context. Was I being mad?

      I don't know if it makes a difference, but we don't have a landlord, only a management company (wish shares distributed to leaseholders). Would they be less likely to act punitvely? If they do attempt to extract a large sum, is there any statutory protection offered to leaseholders I could fall back on?

      Thanks.

      Comment


        #4
        Would any officers of the management company have been aware that works were being carried out?

        Comment


          #5
          No, I didn't notify them of the works at the time, or since.

          Comment


            #6
            In that case I think you need to talk this over with your solicitor. My inclination would be to have one more go at a sale and see what the buyer's solicitor comes up with.

            Comment


              #7
              How about getting a lease extension, (and make sure freeholder's surveyor inspects)?
              To save them chiming in, JPKeates, Theartfullodger, Boletus, Mindthegap, Macromia, Holy Cow & Ted.E.Bear think the opposite of me on almost every subject.

              Comment


                #8
                Assuming a renewal can be justified, that would do it, though I cannot see there is any need for the inspection.

                Comment


                  #9
                  Originally posted by JK0 View Post
                  How about getting a lease extension, (and make sure freeholder's surveyor inspects)?
                  Originally posted by Lawcruncher View Post

                  Assuming a renewal can be justified, that would do it, though I cannot see there is any need for the inspection.
                  Thank you both, though I'm not sure I follow. How does a lease extension help in this instance? Wouldn't this lead to them identifying the wall removal and ultimately have the same effect as notifying them directly?

                  Comment


                    #10
                    If you get a new lease it is of the premises as they are at the start of the lease. The old lease becomes a dead letter and is completely replaced by the new lease. You cannot be sued under the new lease because you will not have made the alteration after the new lease was granted - though in theory the new lease could contain deeming provisions which provide to the contrary.

                    Comment


                      #11
                      Understood. I'm assuming the assumption is that the freeholders surveyor would not be aware of the original layout and would not highlight the change as part of their report? With regards to deeming provisions, what would these look like? Might I be able to spot these in my current lease to see if I'd be affected?

                      Comment


                        #12
                        Originally posted by TripleHelix View Post
                        I'm assuming the assumption is that the freeholders surveyor would not be aware of the original layout and would not highlight the change as part of their report?
                        This is why I suggested getting the surveyor in if possible. Then when you do come to sell, you can prove that the freeholder was aware of the layout at the time the (new) lease started, and gave it anyway.

                        Is there an internal layout plan on your existing lease, that he might twig from, though?
                        To save them chiming in, JPKeates, Theartfullodger, Boletus, Mindthegap, Macromia, Holy Cow & Ted.E.Bear think the opposite of me on almost every subject.

                        Comment


                          #13
                          If your structural engineer has certified that "removal of stud wall" is not a "structural alteration", then you are not in breech of your lease.

                          If your refurbishment has been well finished, then you have not left any visible signs of damage by cut,maimed or injured floors ,walls and timbers.

                          So I would accept Lawcruncher's advice given in post 6.

                          Comment


                            #14
                            Problem is that I bet there's a question asking something like: 'Have you made any alterations during your time of ownership?'

                            If you answer: 'No', and they find out after purchasing, you can be sued.
                            To save them chiming in, JPKeates, Theartfullodger, Boletus, Mindthegap, Macromia, Holy Cow & Ted.E.Bear think the opposite of me on almost every subject.

                            Comment


                              #15
                              Originally posted by Gordon999 View Post
                              If your structural engineer has certified that "removal of stud wall" is not a "structural alteration", then you are not in breech of your lease.

                              If your refurbishment has been well finished, then you have not left any visible signs of damage by cut,maimed or injured floors ,walls and timbers.

                              So I would accept Lawcruncher's advice given in post 6.
                              He certified that it was not loadbearing, but did not provide me with that exact wording. Does that make a difference?


                              Originally posted by JK0 View Post
                              Problem is that I bet there's a question asking something like: 'Have you made any alterations during your time of ownership?'

                              If you answer: 'No', and they find out after purchasing, you can be sued.
                              As in, as part of the least extension? Yes that would be problematic! I'm not really sure what the process is for a lease extension - is that sort of discovery commonplace?

                              Comment

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