Can freehold purchase cause lease to 'disappear'?

[alexd]

Something that is vexing us - in the initial stages of purchasing freehold of a maisonette from current freeholder who lives in the other flat.

When trying to get a copy of the freeholders lease for valuation purposes, we were informed by Land Registry that they do not hold a copy (although there is a copy of his Title Register). My solicitor suggested that when the current freeholder bought the freehold, his lease was no longer relevant so has effectively gone. Could this have possibly been the case?

Apart from negligence, are there any valid reasons why a copy of a lease may not be at Land Registry?

thanks,
Alex

[siva]

Something that is vexing us - in the initial stages of purchasing freehold of a maisonette from current freeholder who lives in the other flat.

When trying to get a copy of the freeholders lease for valuation purposes, we were informed by Land Registry that they do not hold a copy (although there is a copy of his Title Register). My solicitor suggested that when the current freeholder bought the freehold, his lease was no longer relevant so has effectively gone. Could this have possibly been the case?

Yes, the lease can be brought to an end on agreement of both parties (in this case the same party).

If the only other lease is yours then you can value the freehold as though there are no leases. You can create your own lease(s) when you buy the freehold.

Please check with your solicitor before acting on my advice.

[leaseholdanswers]

Perhaps some perspective might help.

A building is freehold and divided up into two flats. Leases are only required if the freeholder wishes to sell the individual flats.

If the freehold title still shows two leases, then they are still valid until they register the surrender of their lease for their flat.

Assuming the freeholder, or their tenant, are going to remain in occupotion of the other flat, then as freeholder to be, your greatest concern is ensuring that you have a contract, ie a lease, with them to set out your mutual rights and obligations.
Otherwise you would be a freeholder with a building subject to one lease and another occupier of indeterminate status and rights and obligations that can only be set by agreement or litigation.

A condition of purchase should be that the old is surrendered and a new lease is granted for the other unit, at their cost.
A few hundred quid job done.

[alexd]

Yes, the lease can be brought to an end on agreement of both parties (in this case the same party).

If the only other lease is yours then you can value the freehold as though there are no leases.

Thanks, yes I was able to get the valuation done as the Title Register for the freeholders lease contained the lease length and ground rent range over the term, and I could calculate the equivalent ground rent based on the same increments in my lease - even though we pay different levels of ground rent.

[alexd]

Assuming the freeholder, or their tenant, are going to remain in occupotion of the other flat, then as freeholder to be, your greatest concern is ensuring that you have a contract, ie a lease, with them to set out your mutual rights and obligations.
Otherwise you would be a freeholder with a building subject to one lease and another occupier of indeterminate status and rights and obligations that can only be set by agreement or litigation.

Thanks, that particular scenario would have been my concern moving forward - however the freeholder has put his flat up for sale and is moving away. So he must have a lease in order to do that? Unless he's planning on creating one when he gets an interested buyer whilst he still has a freehold interest...?

[leaseholdanswers]

Thanks, that particular scenario would have been my concern moving forward - however the freeholder has put his flat up for sale and is moving away. So he must have a lease in order to do that? Unless he's planning on creating one when he gets an interested buyer whilst he still has a freehold interest...?

Yes he would have to do so ( or find his old lease if he did not surrender it). It is therefore important that you both resolve this before either of you exchange contracts.

BUT

If he proposes a new lease that may affect the current freehold value, there is difference between an 85 years lease at £200 pa ground rent and him selling a 999 year lease at a peppercorn, and how they affect the FH value.