Share of freehold - alterations consent - what % of votes needed?

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    Share of freehold - alterations consent - what % of votes needed?

    Hi. I own a flat which is leasehold (I own a share of freehold through the management company). I'm planning some structural alterations to build on land that is already demised as part of the flat and have a few questions which I hope someone can help with:

    1. The lease says I need consent from the Landlord, but it DOESN'T mention that any such request may not be unreasonably withheld. Does that mean that the Landlord can withhold consent without giving a reason? Or is there a general legal foundation that consent cannot be unreasonably withheld?

    2. There are 6 flats and 6 shareholders, including myself. I will obviously vote to give consent and I think 4 of the others will also. The issue is the one remaining shareholder who will probably not give consent. Do we need 100% vote in favour? No one has a copy of the memorandum and articles and companies house don't seem to have them either - at least not on their web service. What happens in this instance? Is 75% vote enough to get consent.

    3. What sort of consent is best? An exchange of letters or should it be done by an amendment to the lease and new drawings showing the layout of the extension?

    Many thanks in advance to anyone who can shed some light....

    #2
    Originally posted by Tlight View Post
    What sort of consent is best? An exchange of letters or should it be done by an amendment to the lease and new drawings showing the layout of the extension?
    Assume the "shareholders" are also Directors of the Managing company, or just a few are ?

    You must remember that the Directors of the company, must wear thier freeholders hat when making decisions, and must look at the concequences of their decisions for future owners, as well as present owners, and not just blindly vote yes because they know nothing about how buildings need supporting, etc etc.

    You will need a majority vote.
    You will need to change 6 leases to show there is a new building ( just a footprint outline ) and stating that it is yours to maintain, and not the freeholders duty to maintain.

    The freeholder should get an independant surveyor to look over your plans, as I am sure the other leaseholders are not strutural engineers, and that cost is passed onto you to pay.
    So you will have 2 surveyors costs to pay.

    I hope you instuct the other leaseholders of their obligations to protect the building, and to get professional assitance to enable them to make a decision whether to give you permission to alter or not.

    Comment


      #3
      1. The lease says I need consent from the Landlord, but it DOESN'T mention that any such request may not be unreasonably withheld. Does that mean that the Landlord can withhold consent without giving a reason? Or is there a general legal foundation that consent cannot be unreasonably withheld?

      Consent cannot be unreasonably withheld. See section 19(2) Landlord and Tenant Act 1927.

      2. There are 6 flats and 6 shareholders, including myself. I will obviously vote to give consent and I think 4 of the others will also. The issue is the one remaining shareholder who will probably not give consent. Do we need 100% vote in favour? No one has a copy of the memorandum and articles and companies house don't seem to have them either - at least not on their web service. What happens in this instance? Is 75% vote enough to get consent.

      If the company's constitution is silent on the matter, decisions are made by the directors. They must act according to the best interest of the company and that may not necessarily be what a majority of the shareholders think it is. A bit of a problem with non-profit making managing companies is that commercial considerations rarely apply. Because there is an obligation not unreasonably to withhold consent the decision needs to be made objectively.


      3. What sort of consent is best? An exchange of letters or should it be done by an amendment to the lease and new drawings showing the layout of the extension?

      Anything in writing which is clear will suffice, unless the lease requires a deed. In practice a deed is always used because the lessee is required to take on obligations. The fact that the building will be extended does not make it necessary for all the leases to be altered. The licence can just simply state that the lessee is wholly responsible for the extension.

      Comment


        #4
        If the leases state the % contribution paid by each flat to service charge account, and if the extension causes change , this has to be discussed and agreed before the freehold company gives consent .

        Comment


          #5
          Agreed. However, if the lessee takes full responsibility there will be no change.

          Comment


            #6
            I was thinking 6 flats currently may be required to pay 16.67% each to the service charge account under the lease.

            If the extension adds an extra room to the flat , then the contributions to service charge account may be changed to 1 x 20% + 5 x 16% or alternatively to 1 x 25% + 5 x 15% .

            So the new contributions agreed must be changed in the leases.

            Comment


              #7
              Thank you all very much. This is excellent information and I have a better understanding of where things stand before taking some official advice. Thanks again, great community!

              Comment


                #8
                Gordon999,

                The contributions only need to be changed if the service charge over all will increase. If the OP agrees to be responsible for the extension there should be no increase.

                Comment

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