What action next against a Freeholder ?

[DNM2012]

Maybe you should accept and see if the price mysteriously increases again

They can't do anything until the new section 5 notice expires whether you accept or not, so you don't have to do anything until then.

You need to decide what you want to achieve if buying the freehold is not an option going forward then look at right to manage.

[BlueMystery]

Exactly some may think this malicious, but we have no affordable protection in law against the Freeholder even though he has breached so many of the legal statutes.

The feeling amongst us is to accept in about 7 weeks time.

Can we withdraw though at any point in the ensuing two months without incurring any fees etc ?

By buying ourselves 4 months essentially it should mean we have a clear direction either for management or to actually instigate an action

[DNM2012]

My understanding of the process is that the deadline for acceptance is specified in the offer notice but cannot be LESS than two months from the date of service.

You then have a further two months to nominate a purchaser, if either party withdraws within the first 4 weeks of the nomination period then neither is liable for the other sides costs.

so you could stretch it out to nearly 3 months before costs become an issue.

[BlueMystery]

might buy time for one of us to win the lottery in anticipation of the price continuing to rise !

[BlueMystery]

Still trying to source a solicitor to take things on board - who would have thought it such a nightmare, the two members of the Owners Group have had no success from a week of speaking to people within a 75 mile radius of where we live.

Meantime in response to our request for sight of the Accounts a few choice phrases (note I posted this to my other similar thread in error)



from an email from the FH>>>>>>>

I do have other things to do than wet nurse you lot

I had a 2yr. contract with the electric company until 16th Jan., this I cannot renew, so these costs are now higher

the exception of the bigot in F1b

odd-job repairs cannot be considered as the funds are running out

if I run out of funds, then any loans to maintain management will be at a very high interest rate

As for the Ground Rent, this money is mine, and as those who refuse to pay are stealing from me, making you criminals, I do not deal with criminals

you and your tenants are now trespassers on my land getting to their respective flats

he tried to make me make alterations before completion, could not, so he arranged for Health & Safety & Fire Officer checks, hoping it cost me

I could have done without you bunch of no-hope amateur buy-to-letters not taking responsibility

Now you have had to be offered the Freehold, by law, you all had your chance and refused, so I see this as a time wasting and money exercise, as you did not want it before, why now? Let the Freehold Agent do his job of selling it for me, then we all will be happy, if you want to make more waves again, the price will go up.

This is the statement you have been asking for, this is not a start of an argument, so any reply will be ignored.



** We only asked for sight of the Accounts !!!!!!!!!!!!

[andydd]

Ha mostly utter crap as I'm sure you know ! Any FH who puts such comments in writing is clearly an idiot and may well find his comments used against him.

So what can you do ?

1. Any breaches of lease you can sue for damages.

2. Any repair that costs more use historic neglect argument

3. Any sc or gr demand invalid don't pay

4, apply to FTT for anything unreasonable in amount

5, ask la to prosecute for not complying with s21 and s22 requests

6, ask FTT to appoint manager

7, similar to 6 you can also force sale of freehold

8. Start rtm of rte

9. If management company complain to redress scheme they belong to

10. Ask FTT that management fee is too high as management is so poor

11. Deduct amounts from service charges as offset against his breaches of lease and let him start legal action for the difference.

[BlueMystery]

Ha mostly utter crap as I'm sure you know ! Any FH who puts such comments in writing is clearly an idiot and may well find his comments used against him.

So what can you do ?

1. Any breaches of lease you can sue for damages.

**How do I assess a fair value as damages - is it the Maintenance Charge less an estimate for Insurance, in the absence of providing any paperwork for March 2015. The Ground Rent is an easy one as previously discussed it can be a Small Claims Court for the Value plus issue fee. By his own admission in pre-purchase paperwork over a £1000 was in the Reserve Fund, and since then the only expenditure has been Insurance March 2015, and a few random cash in hand payments to a DSS person to vacuum the communal area corridor occasionally.


2. Any repair that costs more use historic neglect argument

*** There has been no significant expense since all 7 purchased between Nov 2014, and Oct 2015. Pre- contract paperwork confirms none necessary or planned yet to quote him "he is owed money". I am aware that we are not liable for historic costs incurred pre purchase.

3. Any sc or gr demand invalid don't pay

**As mentioned will take to Small Claims for monies paid in 2015. What I am unclear on then is assuming I win the full refund for 2015, can he or a subsequent Freeholder demand the correct amount from me at a later date ?

4, apply to FTT for anything unreasonable in amount

** Tried to get information out of them regarding potential costs they referred me back to a solicitor for this information and so far none have been able to. If the cost of taking him to FTT is for arguments sake going to be £1000 and this cost is not recoverable even on winning, then whats the point when this is around the sort of sum that could be claimed

5, ask la to prosecute for not complying with s21 and s22 requests

**I tried this last week first of all requesting formal details of their Tenancy Liaison Officer explaining the problem. Their response was "we only get involved if there is a Health & Safety or Environmental issue". I had pointed out to them the comment in one of the Acts that they were the entity to pursue this.
6, ask FTT to appoint manager

7, similar to 6 you can also force sale of freehold

** As previous Section 5 issued to us - all accepted. Same day increased Section 5 issued to all of us - then the comment in his email that he will not ever sale to us.

8. Start rtm of rte

** Already investigated this and will be the ultimate last ditch scenario - however we still have the issues of monies paid (reclaim via small claims) and the larger Maintenance Reserve Fund.

9. If management company complain to redress scheme they belong to

** This is the interesting point. The FH is the Management Company. He trades as XYX Flats (not correct name). The incorrect emailed GR invoice had XYX Flats at the header, and the property address as the Company address. It is not a limited company. He has been unable to produce statutory audited accounts for any period pre-purchase, just a meaningless spreadseet. He ignores request for substantiating paperwork as it will be dozens of supplier till rolls only.

In light of the lack of accounts we would suspect but are not concerned that possible no accounts have been formally produced for the 7 flats - an offence in itself as well as possible tax evasion.


10. Ask FTT that management fee is too high as management is so poor

***The Management Fee which is unknown all we know is we pay £X amount each month for Maintenance (but not invoiced). In a normal scenario we would consider the amount paid would be acceptable for normal management fees in the area, plus a portion saved to the Reserve Fund. What we obviously contest is the "missing monies" and the claim he is owed money.


11. Deduct amounts from service charges as offset against his breaches of lease and let him start legal action for the difference.

***We have all stopped paying these charges as of January until response to request for accounts we have requested etc. However how do we ascertain a value for deduction


Our prime concerns are that he will sell to a new Freeholder and they will not accept his liabilities or responsibilities to provide required information. We have no recourse do we to "sue" them for damages.

The new Freeholders pursue us for breach of lease due to us with-holding monies. Would a Small Claims Judgement against the original FH negate any future claims from other parties for it ?

[BlueMystery]

Almost forgot - at the time of purchase he claimed his accounting year was April to April.

However he then changed this to January to January.

What would be a reasonable period of time to wait for what is a small set of audited accounts and substantiating paperwork to be made accessible with his year having ended 31/12/2015 ?

[andydd]

1. I dont know, but damages are supposed to put you back in position before the incident occurred, so for example someone crashes into you, damage costs 200, so claim would be £200 or maybe plus cost of hire car, no hard and fast rules on this.

2. Think you misunderstood this, historic neglect means that house should of been painted, but it wasnt, FH does repairs 5 years later but now cost is far more than if he had just done cheap paint job originally.

3. NO you cant go to SC court, law only gives power to WITHOLD not claim back money already paid, unless for example you overpaid ground rent.

4. Yes that is problem im having with someone else im helping, they just wont break down the service charge even through its the FH who has started legal action, there are provisions of CPR that can force parties to comply/disclose but its not easy.

5. No surprise here,. law is pathetic here..also annoying is that there is high court case where LH asked judge for injunction to force FH but judge said no need as law already allows prosecution..but as youve found out when asked LA do nothing !!

9. Yes youve found another problem, like me, my FH has no management agent, he manages himself, does he need to belong to redress scheme ?, its unclear but prob not, this is stupid as it provides big loophole for bad FHs !!

10. Yes..another problem. you dont know what M fee is (again, this is issue ive got with friend im helping !!).

Generally leases are assigned so any debts/credits that affected original LH and FH get carried onto new one.

As for future claims, there is recent FTT/Upper Tribunal case where they said that future claims dont have to follow previous claims even if its same LH and FH, that is just bloody ridiculious... See here > http://www.landstribunal.gov.uk/Aspx/view.aspx?id=1233

Ive tried to list all the possible actionj you could take, as youve found out us LH get rightly screwed and the law is an absolute mess.

Ive personally been quite successfull against my FH, Ive njot paid thousands and been awarded about £2000 in various claims BUT a lot of this is down to my FH being rather pathetic and employing some equally useless solicitors.

[BlueMystery]

Thanks for this

I think my various courses of action are

1. To nag away at Council, bring it to the attention of local MP

2. Small claims for repayment of 2015 paid Ground rent

3. In the absence of accounts Small Claims to recover Maintenance Charges paid, deducting a 1/7 as share of insurance, a nominal fee re the cash in hand cleaning, and a nominal amount less than a normal Company would charge in Admin from my claim


As I have said many times the FH considers himself above the Law. I have advised the Freehold Agent acting with the Section 5 of the outstanding issues - as he is the primary party interested in buying the freehold for himself that makes it even more interesting.

The key concern at present is the Insurance of the building, but the apathy of a few of the owners who are intimidated by the FHs libellous and name calling do not make this an easy solution to sort.

[siva]

I apologise if I've missed something. I've read through the thread but very quickly

I think one thing you should consider when offering to buy the freehold is the state of disrepair. As andydd points out earlier a demand from the freeholder (even a new one) to remedy a disrepair that is the result of negligence can be deemed unreasonable and therefore not payable. So anybody who buys the property will be responsible for repairs may not be able to recover all their costs.

With this in mind, you might want to consider whether this should be brought to the attention of the potential purchaser.

If there's nothing along these lines then £6000 + legal fees doesn't sound like a bad deal, assuming the rent is actually £700 per year and reviewed every 30 years. I'm taking the estimate of £2000 legal fees from earlier.

In this time of low interest rates it would be worth taking £2000 out of a savings account in order to save yourself £100 per year. So, even at £12,000 plus legal costs it's not a bad deal in purely financial terms. Although you then have the responsibility/hassle of maintaining the property, etc.

[BlueMystery]

Hi - the problem we have with buying the freehold is assorted.

Firstly the FH offered it verbally to a couple of owners - he deemed that his only legal requirement.

Now we are faced with apathy as a couple of the owners are intimidated by the FH abusive tirade

In due course a Section 5 was received which we all accepted.

The day our acceptances were received with the Agent a further increased Section 5 was issued which we are still considering.

However in response to a request for sight of Audited Accounts (which we know do not exist) we received an email tirade full of libellous comments, and derogatory remarks, finalising that no matter what we accepted he would keep putting the price up as people did not accept his illegal verbal offer last year.

From conversations with the Agent acting it seems he is the interested purchaser - he has been notified and was even copied in by the FH to the abusive email

[siva]

However in response to a request for sight of Audited Accounts (which we know do not exist) we received an email tirade full of libellous comments, and derogatory remarks, finalising that no matter what we accepted he would keep putting the price up as people did not accept his illegal verbal offer last year.

OK, that's not good but your best option to get rid of the guy is to either to buy the freehold or let somebody else. You are very unlikely to come away with any penalty or fine for the freeholder unless something serious can be proven. Pursuing things like failure to provide accounts and libel tend to be a waste of time and money. Very annoying for you but the powers that be tend to consider these things as trivial unless financial damages are considerable.

You don't mention the level of repairs etc. that are required - this is the important thing to consider. If some of the repairs are due to the fact that problems haven't been addressed in a timely manner then the freeholder, whoever it is, may not be able to recover their expenditure from leaseholders.

You don't want to be taking on this risk yourselves and you don't want somebody buying the freehold who doesn't have the funds to deal with the problems. For example, you don't really want a limited company with no other assets buying the freehold.

I think you have mentioned the freeholder is holding contributions by leaseholders. Do you have any idea how much this is? What has been contributed over the years and what estimate do you have in terms of how much the freeholder has spent? You don't really mention service charges, just rent. Other than rent, how much have you been paying and what was this supposedly for?

[BlueMystery]

The Ground rent he has been charging £100 - ok not a lot but the Lease Contracts clearly stated £50 and they cannot be reviewed until 30 years had elapsed

With regard funds when we purchased in October 2014, he advised in the conveyancing papers a credit balance of appx £1100 from memory. However when the last flat sold in October 2015 his solicitor used exactly the same form he had completed for us a year earlier.

To our knowledge he has collected in the region of £3500 to £4000 in fees since the stated balance.

October 2014 was when all major maintenance was finished. The only expenditure since has been about £10 a month for the minimal communal electric (based on a spreadsheet he supplied for previous years - not accounts), about £500 for insurance and about £50 cash in hand to someone to vacuum -- that is it in the period since we purchased ourselves.

He has never given a breakdown of what the monthly charges were allocated as, and has never raised an invoice not even annually. Yet he claimed in the email he was now owed money from the fund.

[siva]

You mention monthly fees. Are you paying a monthly direct debit or standing order? Why are you paying this if you have never received a demand? How much have you paid since October 2014, ignoring ground rent?

What does the lease say in terms of what the freeholder can demand and when? In advance of incurring costs or in arrears?

Does the lease refer to a reserve fund?

Is the property now in good condition?