A woman in east London had her £165,000 flat forfeited over what began as £290 owed in ground rents.
The property had no mortgage, so the massive financial loss is entirely borne by her.
The woman added to her problems by then failing to pay £3,140 in service charge arrears, which with interest added up to £4,056 by the time the matter came to court in April last year.
The freeholder’s legal fees added another £5,491, so she owed £9,547 at the point that the flat was forfeited.
Forfeiture is the nuclear weapon in a freeholder’s arsenal and can result – as here – in a massive cash windfall for the freeholder when dealing with a leaseholder who for some reason or other falls through the system.
We covered in depth the forfeiture of Dennis Jackson’s £800,000 Battersea flat, over debts which arose from a Leasehold Valuation Tribunal action that he substantially won.
The Leasehold Knowledge Partnership, which won a press award for its coverage – little consolation though that was to Mr Jackson – managed to overturn the forfeiture on the 27th day of the 28-days before forfeiture became absolute. More here
Worse, the judiciary considered this case in a closed court from which the public were excluded.
This forfeiture has been submitted by LKP to the Competition and Markets Authority as en example of the excessive and unjustifiable power of forfeiture.
Obviously, there will be occasions when leaseholders simply refuse to pay their share of the communal charges of a flat.
In these cases, it is blindingly obvious that repossession, with the restitution of those monies not required to pay outstanding debts, would be fairer.
Why do our political leaders and regulators allow this massive power of forfeiture to be deployed by lawyers on behalf of some of the worse spivs making a living out of residential property?