non-transfer of freehold
Discussion
This has been an ongoing problem with a buiulder...
3 years after purchasing a flat, they have yet to transfer the freehold to the limited comapny set up for this purpose. ie the flat ownwers, each own a share of the ltd company, and thus control the freehold.
The builders allowed the ltd to get struck off by companies house, and had never seen any accounts.
It has now eventually been resurected, and 1 set of accounts up to nov 2005 produced..
the managemnt of the dev is VERY poor, yet we are unable to do very much as the builder still has the freehold. as the situation is so bad, we cannot realistically sack the manageing agent (legally we can of course - but) as no other managing agent would be willing to take it on...
I have just been informed they have no intention transfering the freehold, until the last unit is sold (they have 3 - but HAVEN'T been paying the service charges)
YET they have not marketed them for 2 years, no for sale signs and no estate agents appointed, in fact they all appear to be let..
They have also said that they legally can't own 3 flats(ie as a lease holder as everybody, and simply tarnsfer the freehold to the lts company vehicle???
In all the legal documentation they have stated that they will be transfering thefreehold, once everything is sold.... I of course assumed that builders build to sell things, not retain them.. the managing agent is struggling to deal with the builders, as they just don't communicate, do antyhing, or even up to this point pay their own service charges, and the agent, is not willing/able to sue his own client (the freeholder) to get things done.
I am pursueing this with my solicitor, but any ideas/thoughts would be welcome what to do, etc
B
3 years after purchasing a flat, they have yet to transfer the freehold to the limited comapny set up for this purpose. ie the flat ownwers, each own a share of the ltd company, and thus control the freehold.
The builders allowed the ltd to get struck off by companies house, and had never seen any accounts.
It has now eventually been resurected, and 1 set of accounts up to nov 2005 produced..
the managemnt of the dev is VERY poor, yet we are unable to do very much as the builder still has the freehold. as the situation is so bad, we cannot realistically sack the manageing agent (legally we can of course - but) as no other managing agent would be willing to take it on...
I have just been informed they have no intention transfering the freehold, until the last unit is sold (they have 3 - but HAVEN'T been paying the service charges)
YET they have not marketed them for 2 years, no for sale signs and no estate agents appointed, in fact they all appear to be let..
They have also said that they legally can't own 3 flats(ie as a lease holder as everybody, and simply tarnsfer the freehold to the lts company vehicle???
In all the legal documentation they have stated that they will be transfering thefreehold, once everything is sold.... I of course assumed that builders build to sell things, not retain them.. the managing agent is struggling to deal with the builders, as they just don't communicate, do antyhing, or even up to this point pay their own service charges, and the agent, is not willing/able to sue his own client (the freeholder) to get things done.
I am pursueing this with my solicitor, but any ideas/thoughts would be welcome what to do, etc
B
Edited by BJWoods on Friday 22 June 11:44
what do you wish to acheive? Who owns the freehold should not make much difference to the leaseholders.
Is the current freeholder not doing something which they should be as written in your lease? if so then you can take action against them.
If they are incuring excessivly expensive bills for the benefit of the fproperty then they can be challanged as well. It doesnt really matter who owns the freehold.
We ask as managing agents to some blocks of flats, the freehold was 'purchased' by the leaseholders some years ago and into a management company with some of the leaseholders as directors.
Your managing agent probably is not getting any responce from the builders and their hands are tied. Personally I wouldnt worry too much who holds the freehold so long as the normaly maintence and cleaning is being carried out ok.
As its a new build 3 yrs, you will need to make realisitc provision for building maintence. One small group of flats we took over from a builder had set the annual maintence at about £120 a year for each flat. All the flats were sold, we then instructed, and when we told the leaseholders that the maintence would have to go up they didnt want to and argued it was set at £120 a year.
They soon saw the light when we highlighted to them that simply the building insurance was more than they were all paying let along immediate maintenance, fees, cleaning and long term build up of funds.
How/why they bought not expecting the maintence had to increase was bizar.
Is the current freeholder not doing something which they should be as written in your lease? if so then you can take action against them.
If they are incuring excessivly expensive bills for the benefit of the fproperty then they can be challanged as well. It doesnt really matter who owns the freehold.
We ask as managing agents to some blocks of flats, the freehold was 'purchased' by the leaseholders some years ago and into a management company with some of the leaseholders as directors.
Your managing agent probably is not getting any responce from the builders and their hands are tied. Personally I wouldnt worry too much who holds the freehold so long as the normaly maintence and cleaning is being carried out ok.
As its a new build 3 yrs, you will need to make realisitc provision for building maintence. One small group of flats we took over from a builder had set the annual maintence at about £120 a year for each flat. All the flats were sold, we then instructed, and when we told the leaseholders that the maintence would have to go up they didnt want to and argued it was set at £120 a year.
They soon saw the light when we highlighted to them that simply the building insurance was more than they were all paying let along immediate maintenance, fees, cleaning and long term build up of funds.
How/why they bought not expecting the maintence had to increase was bizar.
superlightr said:
what do you wish to acheive? Who owns the freehold should not make much difference to the leaseholders.
Is the current freeholder not doing something which they should be as written in your lease? if so then you can take action against them.
If they are incuring excessivly expensive bills for the benefit of the fproperty then they can be challanged as well. It doesnt really matter who owns the freehold.
We ask as managing agents to some blocks of flats, the freehold was 'purchased' by the leaseholders some years ago and into a management company with some of the leaseholders as directors.
Your managing agent probably is not getting any responce from the builders and their hands are tied. Personally I wouldnt worry too much who holds the freehold so long as the normaly maintence and cleaning is being carried out ok.
As its a new build 3 yrs, you will need to make realisitc provision for building maintence. One small group of flats we took over from a builder had set the annual maintence at about £120 a year for each flat. All the flats were sold, we then instructed, and when we told the leaseholders that the maintence would have to go up they didnt want to and argued it was set at £120 a year.
They soon saw the light when we highlighted to them that simply the building insurance was more than they were all paying let along immediate maintenance, fees, cleaning and long term build up of funds.
How/why they bought not expecting the maintence had to increase was bizar.
nothing is being done.Is the current freeholder not doing something which they should be as written in your lease? if so then you can take action against them.
If they are incuring excessivly expensive bills for the benefit of the fproperty then they can be challanged as well. It doesnt really matter who owns the freehold.
We ask as managing agents to some blocks of flats, the freehold was 'purchased' by the leaseholders some years ago and into a management company with some of the leaseholders as directors.
Your managing agent probably is not getting any responce from the builders and their hands are tied. Personally I wouldnt worry too much who holds the freehold so long as the normaly maintence and cleaning is being carried out ok.
As its a new build 3 yrs, you will need to make realisitc provision for building maintence. One small group of flats we took over from a builder had set the annual maintence at about £120 a year for each flat. All the flats were sold, we then instructed, and when we told the leaseholders that the maintence would have to go up they didnt want to and argued it was set at £120 a year.
They soon saw the light when we highlighted to them that simply the building insurance was more than they were all paying let along immediate maintenance, fees, cleaning and long term build up of funds.
How/why they bought not expecting the maintence had to increase was bizar.
no cleaning has been done for months, the gardens no work eitther, locks not fixed, security lights not working, security gates broken months at a time, many, many other issues
no accounts produced.
the builders still own 3 flats, that they let yet have NOT even paid the service charges, leaving the management agent in the position that it need to sue it's own client for these service charges.. we cannot sack the agent, as no other agent will be willing to take the mess on...
maintenace charge is corret £900 pa per flat. YET nothing is done
i bought the flat specifically with the fact as I SHOULd own a share of the freehold (ie own a share of a ltd company set up specifically for this purppose), it would be easier to replace any managing agent.
the builder allowed the ltd companyto be struck off by companies house for non filing, and i discovered for over a year the building insurance was in the name of a now defunct ltd company - if there had been a fire, i really doubt insurance would have paid out.
I'm in the position that i have NOT got what i purcahsed- no other agent would be willing to take it on, and have zero recourse.
the builders reponse is they only said they would transfer the freehold, when last unit sold. 3-4 years on from they are letting 3 units, so potentially could NEVER transfer the freehold. they are NOT marketing the 3 flats for sale.
B
B
how many flats in total?
Do you pay monthly or annual? and to whom ie the builders who still owns the freehold? or someone else?
You still have the right to buy the freehold if a certain percent agree, I think is 75% of the leaseholders but double check that. We have not done this for about 16 yrs so a bit rusty. But new legislation does allow you to purchase the freehold.
I would suggest you contact the other leasholders and have a meeting as to what you all wish to do. Perhaps all put in a bit for legal advice. Start your own maintence fund and deduct from what you pay.
Clearly building Insurance is Vital and you should talk to a morgage provider about getting insurance as you do have an interest in the property, although it may be hard to insure as you are not the owners.
it does sound a mess. do keep us posted
Do you pay monthly or annual? and to whom ie the builders who still owns the freehold? or someone else?
You still have the right to buy the freehold if a certain percent agree, I think is 75% of the leaseholders but double check that. We have not done this for about 16 yrs so a bit rusty. But new legislation does allow you to purchase the freehold.
I would suggest you contact the other leasholders and have a meeting as to what you all wish to do. Perhaps all put in a bit for legal advice. Start your own maintence fund and deduct from what you pay.
Clearly building Insurance is Vital and you should talk to a morgage provider about getting insurance as you do have an interest in the property, although it may be hard to insure as you are not the owners.
it does sound a mess. do keep us posted
superlightr said:
how many flats in total?
Do you pay monthly or annual? and to whom ie the builders who still owns the freehold? or someone else?
You still have the right to buy the freehold if a certain percent agree, I think is 75% of the leaseholders but double check that. We have not done this for about 16 yrs so a bit rusty. But new legislation does allow you to purchase the freehold.
I would suggest you contact the other leasholders and have a meeting as to what you all wish to do. Perhaps all put in a bit for legal advice. Start your own maintence fund and deduct from what you pay.
Clearly building Insurance is Vital and you should talk to a morgage provider about getting insurance as you do have an interest in the property, although it may be hard to insure as you are not the owners.
it does sound a mess. do keep us posted
Have you read my posts?! Do you pay monthly or annual? and to whom ie the builders who still owns the freehold? or someone else?
You still have the right to buy the freehold if a certain percent agree, I think is 75% of the leaseholders but double check that. We have not done this for about 16 yrs so a bit rusty. But new legislation does allow you to purchase the freehold.
I would suggest you contact the other leasholders and have a meeting as to what you all wish to do. Perhaps all put in a bit for legal advice. Start your own maintence fund and deduct from what you pay.
Clearly building Insurance is Vital and you should talk to a morgage provider about getting insurance as you do have an interest in the property, although it may be hard to insure as you are not the owners.
it does sound a mess. do keep us posted
I AM THE OWNER
I SHOULD own the freehold (at least one fourteenth share - 14 flats)
the builders still have, they should have transferred it to a ltd company, which the flatowners - each own a share of.
B
If I have read it right you are a leaseholder, not the freeholder and hence not the owner.
You thought your were going to own a part of the management company which owns the freehold but dont as its not been sold/tranfered to the management company. You still would only own a share in the management company and still not be the owner of the freehold in any event.
I think I understand the situation - (I do do it for a living)
My advice is as per my previous post.
Good luck with it.
You thought your were going to own a part of the management company which owns the freehold but dont as its not been sold/tranfered to the management company. You still would only own a share in the management company and still not be the owner of the freehold in any event.
I think I understand the situation - (I do do it for a living)
My advice is as per my previous post.
Good luck with it.
superlightr said:
If I have read it right you are a leaseholder, not the freeholder and hence not the owner.
You thought your were going to own a part of the management company which owns the freehold but dont as its not been sold/tranfered to the management company. You still would only own a share in the management company and still not be the owner of the freehold in any event.
I think I understand the situation - (I do do it for a living)
My advice is as per my previous post.
Good luck with it.
it is not about 'thinking' i own a share of the free hold, that is what I boughtYou thought your were going to own a part of the management company which owns the freehold but dont as its not been sold/tranfered to the management company. You still would only own a share in the management company and still not be the owner of the freehold in any event.
I think I understand the situation - (I do do it for a living)
My advice is as per my previous post.
Good luck with it.
I'm not going to buy the freehold... again
WE all ready SHOULD own it, ie via the ltd company specially set up for the purpose... and the leaseholder, as shareholders of the freehold, can then do whatever they want, etc,etc,etc. act in our own interests, not dome absentee freeholder.
The builder (as PART of the contract) in all the legal documents has stated the freehold will be transferred to theltd company, where we all own a sahre of..
The builder just has has not done it.. though maliciousness, incompetance, idiocy, i know not why, neither does my lawyer understand what they are playing at.
B
Edited by BJWoods on Monday 25th June 15:38
superlightr said:
did your solicitor confirm the % required to buy the freehold or if court action should start to honour his part of the deal?
i think you are missing the point..this was a new build.
i was the first owner.
the builder set up a ltd company for the freehold. each flat owner would own a share of the ltd company. freehold would be transferred... we ALLREADY bought it. it was part of the sale when we bought the flat. ie for sale brand new lease hold flat, including share of freehold £x,000 pounds.
the issue is when the last flat was sold, the freehold should be transferred.
B
. It how to resolve it practically and efficently.
if he doesnt honour his part of the deal to transfer the freehold which he hasnt to the management company - then your left with 3 options
1) court action to try to start to force the transfer and performance of the contract although it may be argued the coditions of all being sold have not been met - which is outside of your control.
2) or to exercise the right to buy the freehold which is probably withing your immedicate control, highlighting this was meant to be the original arrangement in anyevent and already paid for hence a £0 rate should be applied - this option cant be defended as such and thus may be easier than going to court in 1.
3) do nothing
if he doesnt honour his part of the deal to transfer the freehold which he hasnt to the management company - then your left with 3 options
1) court action to try to start to force the transfer and performance of the contract although it may be argued the coditions of all being sold have not been met - which is outside of your control.
2) or to exercise the right to buy the freehold which is probably withing your immedicate control, highlighting this was meant to be the original arrangement in anyevent and already paid for hence a £0 rate should be applied - this option cant be defended as such and thus may be easier than going to court in 1.
3) do nothing
Edited by superlightr on Tuesday 26th June 09:40
superlightr said:
. It how to resolve it practically and efficently.
if he doesnt honour his part of the deal to transfer the freehold which he hasnt to the management company - then your left with 3 options
1) court action to try to start to force the transfer and performance of the contract although it may be argued the coditions of all being sold have not been met - which is outside of your control.
2) or to exercise the right to buy the freehold which is probably withing your immedicate control, highlighting this was meant to be the original arrangement in anyevent and already paid for hence a £0 rate should be applied - this option cant be defended as such and thus may be easier than going to court in 1.
3) do nothing
2 sounds the most likely option, but i don't see why we should have to pay costs to get what is ours anyway..if he doesnt honour his part of the deal to transfer the freehold which he hasnt to the management company - then your left with 3 options
1) court action to try to start to force the transfer and performance of the contract although it may be argued the coditions of all being sold have not been met - which is outside of your control.
2) or to exercise the right to buy the freehold which is probably withing your immedicate control, highlighting this was meant to be the original arrangement in anyevent and already paid for hence a £0 rate should be applied - this option cant be defended as such and thus may be easier than going to court in 1.
3) do nothing
Edited by superlightr on Tuesday 26th June 09:40
3 is untenable.
If I were a vindictive person, I would suggest between the 14 less 3 if you do exercise the right to buy the freehold and put into the management company, it may be easier to just set up a new management company (and company secretary) to own the freehold. Get it all under your control, directors and co sec and done correctly. Get the build insurance set up asap.
admin charges can be made if maintenance funds are not paid on time, mortgage companies can be written to to recover the arrear + admin fees, and add a few more admin fees plus solicitors costs to the errent 3 owned by this builder.
Gurantee he wont pay the maintenance fund and or ground rent or contribute towards legal fees to purchase. All of these are normally justifed to make further charges on him. each and every time a reminder is sent if you want to be nasty.
He will sell at some stage, he is likely to have a mortgage, which the B/S will pay the arrears and admin fees normally without any questions. If he doesnt then he will need consent of the freeholder when he sells (aka management company) that his account is uptodate and bingo you have a strong hold on him, He will need a stock (share) transer of his part in the man co and his sale cant complete until this is done. or 3rd get a charge on his leasehold but thats a bit more of a pain.
From experience, mortgage companies are good at paying up with no cost to you. We have managed to get over £1000 admin fees for an original debt of £600 over 2 years owed. Smaller amounts all the time.
admin charges can be made if maintenance funds are not paid on time, mortgage companies can be written to to recover the arrear + admin fees, and add a few more admin fees plus solicitors costs to the errent 3 owned by this builder.
Gurantee he wont pay the maintenance fund and or ground rent or contribute towards legal fees to purchase. All of these are normally justifed to make further charges on him. each and every time a reminder is sent if you want to be nasty.
He will sell at some stage, he is likely to have a mortgage, which the B/S will pay the arrears and admin fees normally without any questions. If he doesnt then he will need consent of the freeholder when he sells (aka management company) that his account is uptodate and bingo you have a strong hold on him, He will need a stock (share) transer of his part in the man co and his sale cant complete until this is done. or 3rd get a charge on his leasehold but thats a bit more of a pain.
From experience, mortgage companies are good at paying up with no cost to you. We have managed to get over £1000 admin fees for an original debt of £600 over 2 years owed. Smaller amounts all the time.
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