What action next against a Freeholder ?

[BlueMystery]

Slowly getting there thanks so to summarise

1. If 4 of the owners think they will buy, they serve a notice in response quickly using one of them as a nominated person - the 3 who are not interested do nothing

2. If the FH accepts the offer of £2000 plus expenses per lease, £14,000 plus expenses then needs to be raised by those 4 assuming the other 3 do not change their mind. Is there a time span for completion ?

3. If the FH refuses the offer he cannot sell to XYZ company at this time. A further period of time has to elaps and then the process of Refusal starts over again. If this is correct what is the time span to elaps ?


What if the 4 owners change their minds ?

Many many thanks - feel light is starting to show at the end of the tunnel - just need to explain all to the various owners !

[andybenw]

My reading is £2000 for the freehold. Not £2000 per leaseholder.

So if 4 of you buy that is £500 each plus a share of thevlegal fees. You'd be mad not to.

[BlueMystery]

I agree totally, but a solicitor who acted on behalf of one of the other owners, said he read it as £2000 each.

I think I need to go back to the company who issued it for clarification

[DNM2012]

Slowly getting there thanks so to summarise

1. If 4 of the owners think they will buy, they serve a notice in response quickly using one of them as a nominated person - the 3 who are not interested do nothing

2. If the FH accepts the offer of £2000 plus expenses per lease, £14,000 plus expenses then needs to be raised by those 4 assuming the other 3 do not change their mind. Is there a time span for completion ?

3. If the FH refuses the offer he cannot sell to XYZ company at this time. A further period of time has to elaps and then the process of Refusal starts over again. If this is correct what is the time span to elaps ?


What if the 4 owners change their minds ?

Many many thanks - feel light is starting to show at the end of the tunnel - just need to explain all to the various owners !

1) Correct.

2) Noooo its £2000 in total not per lease plus legal costs, I'd allow around £3-4K for legal fees, yours and FH.

3) Correct, can't remember the exact time scales but they are set out in the notice, but you should be able to complete in around 6 months.

4) If the required majority drops below 50% then you have to withdraw and the FH can then sell elsewhere.

Read the guide to right of first refusal at lease-advice.org, it explains the whole process.

[BlueMystery]

Thank you massively

If the £2000 total is correct - obviously I will need to get a formal document prepared by the minimum of 4 owners authorising us to accept the offer

Is there a specific form to use to accept which we need to send off

[DNM2012]

I don't think there is a specific form, but if you get the support from enough leaseholders, I would get a solicitor experienced in this area to handle things going forward.

[BlueMystery]

great - fingers crossed then

thank you for everything

[BlueMystery]

Can I just double check the point regarding payment of legal fees.

The Section 5 advises we would be responsible for all fees.

A solicitor we contacted at the outset in his report to us said we would not be liable.


Which will it be and how should we draft our acceptance of offer letters in light of this

The online pdf also seems to contradict itself

[BlueMystery]

Can I just double check the point regarding payment of legal fees.

The Section 5 advises we would be responsible for all fees.

A solicitor we contacted at the outset in his report to us said we would not be liable.


Which will it be and how should we draft our acceptance of offer letters in light of this

The online pdf also seems to contradict itself

UPDATE TO THE ABOVE

Just received this info

legislation may state that the freeholder would pay his own costs when selling to the leaseholders however he has received an offer from a third party who have agreed to pay his costs so he has in fact been offered more than just the purchase price. If you dispute this then he will simply serve notice again for an increased price to account for his legal fees which he is entitled to do.

** comments please

[DNM2012]

UPDATE TO THE ABOVE

Just received this info

legislation may state that the freeholder would pay his own costs when selling to the leaseholders however he has received an offer from a third party who have agreed to pay his costs so he has in fact been offered more than just the purchase price. If you dispute this then he will simply serve notice again for an increased price to account for his legal fees which he is entitled to do.

** comments please

The section 5 notice is quite clear £2000 plus freeholders legal costs.

If that is what the company offering to buy it is prepared to pay then that is the agreed price.

When I bought my freehold I had to pay the freeholders legal costs, my very experienced solicitor did not raise this as an issue.

Also logically if the FH legal fees are £2k then he might as well just give the FH away if he's liable for them.

[BlueMystery]

Does logic really apply when dealing with Leasehold stuff

Now to source a competent solicitor to arrange things............

[Gordon999]

Competent solicitor means a law firm having experience in LandLord & Tenant Act problems and dealing with freehold title conveyancing arising from Right Of First Refusal Offers .

[BlueMystery]

UPDATE

There has been another twist.

Six of the 7 leaseholder sent an acceptance offer to the company who issued the section 5, these would have been delivered on 5th or 7th March, one week before the Section 5 two month period finished.

On the evening of the 7th March (ie one week before the Section 5 finished, and after receipt of our acceptance letters) the company acting on behalf of the Freeholder whom we understand from conversations were keen to purchase the freehold themselves, issued a FURTHER Section 5 notice, this time increasing the amount required from £2000 + legal costs to £6000 + legal costs.

IS THIS LEGAL to do this ?

[DNM2012]

Unfortunately it is legal.

The protection you have is that the FH cannot sell it to anyone else on better terms than in the new notice for 12 months, so if you don't accept the new offer the company that have offered to buy it will have to pay the higher price too.

You need to get a valuation of the freehold to decide the way forward. It may be you have to look at enfranchisement as the way forward. It may be the original offer price was undervalue or it may be that now he knows you're interested he's trying it on by increasing the price.

[BlueMystery]

We had confirmed that by including his legal fees in the original section 5 he was right at the top end of value.

I do not think anyone will accept this increased demand inlight of all the lies and behaviour from the owner - to all intents and purposes the property is uninsured in a couple of weeks and no maintenance in place.

We firmly believe that the company who sent the Section 5 on his behalf want the freehold for themselves from a comment they made a few weeks back how they could buy the freehold themselves and let us manage the property as this could be sorted inside 3 weeks by them - how I dont know as the Section 5 would only have just been finishing the 2 month period.

One comment they made in an email read that the Freeholder at the outset had offered the FH to multiple companies before a section 5 was issued to us. We just find it incredible that this new higher offer was issued the day we had acceptance lodged - really think this company is pushing the boundaries.

I guess what we could do to be awkward if the majority voted would be to accept the new Section 5 in 7 weeks time, wait a further 7 weeks then withdraw - causing a degree of inconvenience - just need to verify we would not incur any legal fees in that scenario though

We have this attitude regrettable due to all the problems we have had with our leases, and getting permissions, information etc