A leaseholder trying to sell a flat in Lightwater in Surrey has asked James Tuttiett, the CEO of E & J Capital Partners to hurry up with changing doubling ground rents to ones linked with RPI.
So far Shelly Westbrooke has lost two buyers of her flat because of the lease terms at John Norman Grove.
Dear Mr Tuttiett ,
I am writing to advise you that since trying to sell my flat at the above address , I have found that it comes under the 10 year doubling scheme , and this has now halted the sale.
My buyers can not proceed as they are unable to obtain a mortgage on a doubling ground rent property .
This will be the second buyer I have lost at just before the point of exchange ( although I did not realise the reason why I lost my first buyer until now )
My flat first went in the market in February , so this has been a long ongoing situation .
When I spoke to Chloe Hayter in your legal team I was advised that I would hear about the deed of variation by the end of September . I have received a letter today ( nothing like leaving it until the last minute ) actually telling me nothing . Apparently you are in the middle of discussions which you hope will be completed early in the new year ! How much longer after that for this to be resolved ?
Surely you must realise that I am only one of thousands of people who are stuck in properties which they cannot sell , and therefore means there are properties that we are not purchasing ! Estate agents , for one will be affected , mortgage companies etc etc …the list is endless .
If this is not resolved immediately and my sale / purchase falls through , I will then be going down the route of compensation , as will thousands of other people . The ripple effect and repercussions of this will be immense .
I look forward to hearing from you to hear how you are going to resolve this .
Regards ,
Shelly Westbrooke .
Related posts:
I had to spend £14,000 to change double ground rent to RPI at Ausden Place. But will I get compo from Taylor Wimpey?
Barclays turns down mortgage on flat where ground rent doubles every 25 years
James Tuttiett’s tangled web of E&J freeholds scrutinised by the Guardian
Daily Mail reports E&J Estates and wine-growing freeholder James Tuttiett
E&J Capital Partners in full retreat over rapacious ground rent terms
Rendall and Rittner buys Braemar Estates
I think Shelly Brooke and her local MP plus APPG ( including 117 MPs) should make a joint complaint to Competition and Markets Authority ( CMA ) to have :
(1) All ground rents doubling every 10 Years term in residential leases be declared an UNFAIR contract term .
( 2) Legislation allowing “Forfeiture of residential long leases over 99 years ” and based on “arrears of less than the premium paid by first leaseholders” be declared an UNFAIR contract term.
https://www.gov.uk/cma-cases/residential-estate-agency-services-suspected-anti-competitive-arrangement-s
No rambling comments about freeholder abuse. It confuses the law makers as to what people want ..
Just make a clear cut proposal to CMA.
Restrict to making proposal for CMA to declare as an unfair contract term.
( Note – 117 MPs must represent about 20% of the constituencies in E & W. )
Ollie I believe comments about Freeholder abuse is imperative as it conveys that leaseholders have ‘ shaken their chains to earth like dew’ and are showing that they are no longer going to be cowed by these unscrupulous operators.
Whether you think them ‘ rambling’ is entirely irrelevant.
Also, how can you state that that the above ” Confuses the law makers”
Where’s your evidence?
This story is about a leaseholder with her doubling ground rent problem and not being able to sell her leasehold flat .
What is your proposal to SKP and APPG to help solve Shelly’s problem , without any shaking of your chains or rambling ?
Ollie. I am fully aware of what ” The story is”. and also that it is part of a much wider issue hence the conception of NLC .Your points 1&2,in your first post have been made many time s on this site by others and with respect, more cogently.
In answer to your question ‘ how to solve a problem of Shelly”s
1. I am in direct contact with my MP who is an APPG member and a member of the CLG. Her focus is on the thousands of of residents who are already tied into exploitative leases like Shelly’s and I will highlight shellys particular plight.
2. My ‘ paper’ on the removal of forfeiture from the statute book has been acknowledged by the DCLG and I was informed that it would be discussed as part of the consultation.
” Shaking chains’ – I believe that other ‘Shelly ‘ knew what he was conveying when he wrote that rambling ditty!!
Ollie, everyone has their own style of communication.
I trust that you are one of those chaps who believe that only women are rambling……… that’s quite enough ed.
I do hope that you have signed the petition and shared it with all you know. We have 3,000+ signatures and expect 5.000 by 11pm on Sunday .
C’mon put your thinking cap on Ollie and get those signatures in.
My thinking cap says small adverts placed on the free Advert Boards at local supermarkets may catch the eye of shoppers .
Letter to the editor of newspapers in provincial towns can also catch public attention .
Hello Ollie says
Why not ask the consumers organisation Which to investigate making a super complaint to the Government about unfair contract terms ?
Abolition of leasehold must be our eventual aim.
When you ask for LKP and APPG to do something, you must remember its area of influence is around Parliament , Westminster and Government Departments. ( Housing Department , FTT and Courts etc )
LKP and APPG have no influence on Which. Which can compare consumer products and tell which brand is made better but it has little influence in Parliament.
You cannot ask for outright “Abolition of Leasehold” until there are 326 MPs in E & W willing to back and vote for such proposal in Parliament. So the changes in legislation have to be made by hacking away at the existing rules.
So we can ask the APPG to request CMA to declare the “Doubling of ground rent after every 10 years” and Forfeiture of Lease as “unfair” contract terms because CMA cannot prove these terms are fair to the buyers.
I can remember that about six years ago the Office of Fair Trading declared Exit Fees as being unfair but nothing happened.
That was after spending about two years considering the issue and spending around £1m of public money on the investigation.
A similar even bigger Inquiry was on the Peverel Price Fixing affair which again resulted in no action.
A lawyer, hand-picked (safe pair of hands) not to rock the boat, was put in charge: Stephen Lewis. Nice guy but given a very limited remit and seemingly persuaded (perhaps from personal experience or family circumstances?) that it was reasonable for the elderly to be ripped off if it provided them certainty that a fixed income would suffice for their living expenses in their old age.
Those complicit in “Just obeying orders” have a lot to answer for. There are an awful lot of enablers of corruption and malfeasance in and around property in the UK. The inability to see and act on what is legal but morally repugnant explains a lot of the UK’s current circumstances.
Today, the movie business: https://www.theguardian.com/film/2017/oct/13/harvey-weinstein-allegations-hollywood-enablers
Leasehold when?
I would like to see some of the principals and their aiders and abetters in parliament answering questions.
Michael, I seem to recall that the OFT backed down from taking definitive action over unfair exit fees, instead opting for a “voluntary agreement” on exit fees from the freeholders.. Exit fees soon became “event” fees.. There were two types of exit fees as far as I remember? One was money paid direct to the freeholder for no purpose other than to boost the income of the freeholder. The other exit fee was as a deferred contribution to service charges. This method serves to disguise the true cost of the service charges. It also takes away the rights of the resident to challenge that part of the service charge. And of course it has happened in the past that a managing agent (Firstport) has passed funds from an exit fee designated for service charges direct to the freeholder.. Only after residents found that this had happened and fought for a refund was £39,000 repaid to the service charge account. Firstport have still to answer as to whether they got the money back from the freeholder?
Ollie,
I agree with advice that when making formal representations to keep to the legal facts. The old rule I learnt was, if you couldn’t summarise your issue on a single A4 sheet you could lose your reader. Like all rules it is a blunt one.
It depends on the subject matter and context. Imagine if Leveson or the Iraq inquiry had tried to cover the topic in one page? Legal reform is a dense topic. Or if debates in parliament had to be bullet points? (On the other hand…)
I think reasonable confusion also arises as to why restrictions should apply when communicating here? I agree with Kim. There is always more to say rather than less. My submission to the DCLG ran to almost fifty pages including graphs, case law extracts, footnotes and worked examples – unlike the illustrious agencies with their brief bland opinions, I felt I had to back my arguments.
Reading the submissions by the ‘industry’ to the DCLG, it is to me astonishing how bland many of their assertions are, as if their status alone gives them unquestionable insight so that they need not produce empirical evidence to support their opinions. Notice how often the same mantra appears: nothing intrinsically wrong with leasehold as a housing tenure; well established; needed for positive covenants; just more self regulation and best practice, blah blah. But no evidence.
Does anybody do proactive research of the actual consumers of leasehold tenure?
You’d be forgiven for thinking a few cowboys recently brought an otherwise noble long standing industry into disrepute?
On a personal note, did you mean to exclude 99 year leases from protection against forfeiture in your para (2) above? If yes, why?
also curious as to the question above re forfeiture and 99 year leases…
Although signed Kates petition and would love to see leasehold abolished, the present government aint gonna do that. The PM is barely holding it together and Brexit is the main preoccupation. leasehold problems continually are being swept under the carpet.
Going to FTT made me realise the horror of our position, of course the judge and the establishment as a whole, has known about the abuses, but so far unwilling to resolve.
Somehow this needs to move into main stream news, highlighting the need for urgent reform, The system because of its opacity doesn’t just exploit leaseholders, but taxpayers as a whole.
To: Paddy and fleecehold reform :
I should have said ” Forfeiture of long leases of 99 years and longer , should be declared an “unfair contract term” but there is nothing to prevent you proposing an alternative figure.
At present, the freeholder can start forfeiture proceedings when the ground rent in arrears exceeds £350 for over 3 years and this results in the freeholder’s solicitor being given the green light to inflict onerous legal fees on the leaseholder ( because this term is written in the lease that the freeholder can recover all costs, associated with recovering ground rent arrears, from the leaseholder.
In 2002 during speech in Parliament , Barry Gardiner MP identified Simarc and E& M as ground rent grazers who “created arrears” for leaseholders to make to make them pay up hefty recovery costs for settling arrears. At that time, the leases included the term ” Ground rents are due whether demanded OR not ” so the Managing Agent did not demand the ground rent . After being left in arrears for 3 years, their solicitor would hit the leaseholder with a bill for a few hundred pounds .
I believe £350 is only “week’s wage for many” and not a substantial loss to warrant forfeiture of lease which may have costed atleast £50,000 or over when the flat was bought . For debt below £10,000 , the recovery of ground rent arrears should be done through the small claims court (operated under the County Court ) .
Does the Housing Minister and Civil Servants think it is justified to forfeit the lease of a £150,000 flat in his constituency for £350 of ground rent arrears in 2017 ?
Exactly what you mentioned happened to me. In the 90’s the solicitors Bude Nathan Iwanier (who were also the freeholder, though another company) , send me a bill for £500 legal costs because I did not pay ground which was not demanded, but ‘ is due whether demanded one not’. My bank added it to my morgage and I paid for it and was careful to send them regular checks after that.
What’s not to love about this system? Why would anyone think that it needs reform?
Hello,Sophie please sign and share the petition if you have not already done so. . It is imperative that ALL leaseholders sign.
Thank you
I should also highlight the £500 was the legal costs, the ground rent itself was only £50. Bude Nathan Iwanier managed the building and were also the freeholder, essentially they could create legal bills for themselves which had to be paid by me, the leaseholder.
In later years they made other ‘mistakes’, where although I was careful to pay the ground rent, it was demanded again. I kept careful records as I became aware of this, but still, it was easer for me to pay the ground rent again, rather than risk more legal bills.
At the time I genuinely thought it was an error, though I now realise its ‘wealth creation.”
Ollie I honestly believe you could do better. “Free adverts in supermarkets”? ” Provincial news editors”‘ what on earth are you on about?
This is the era of Cyberspace not last of the summer wine. C’mon adjust that thinking cap, pull your socks up and help generate signatures.- there’s a good fella.
You may think you are living in cyberspace but those 4 million leaseholders are still living on 2G mobile phones and never heard of any petition .
Well if that’s what you truly believe then get out there Ollie and start knocking on doors, spread the word -there’s a good chap.
I ‘ll keep doing my bit in cyberspace and informing all who I meet in my daily doings… I hope you have signed and shared the petition with all your contacts and urged them to sign it.
C’ mon positivity is required Ollie. Turn that frown upside down…..☹️????
Forfeiture is one amazing scam. It’s not just the out-of-proportion legal availability but the court costs.
Yet when reading upper tribunal cases it is clear courts have a blind patch over any common sense eye because they never bat one at this issue.
Let’s say they are weighing up whether an underletting fee ought to be £X or £Y within less than £50-£100 variation…
Stop first and consider the absurdity of judges (what do they earn an hour?), court back office staff etc, all spending hours on appeal deciding whether £90 or maybe £165 is a reasonable fee?
It is INSANE.
Moving on… the court will commonly make the point that a failure to abide by the lease -in every single small regard- would be a breach that can expose the leaseholder to forfeiture.
Fit a shower cubicle – breach of lease
Fit a boiler flue – breach of lease
{Landlord/agent insert whatever act} – breach of lease
Let’s say leaseholder sublets without consent. Not nice, but is it a forfeiture offence? Well yes. Everything is. Agent sends stock letter demanding registration fee and retro consent fee, or might offer a ‘licence’ instead. Agent might want an annual consent fee on top.
Miffed leaseholder refuses to pay, basing their judgment on normal life experience where random high fees cannot be applied (think bank charges etc).
Trouble is, leasehold is not normal life. Registration fees are outside the variable admin fee rules and are not service charges. Tribunal ducks the question of that fee. Pay it or be in breach.
As to the consent fine itself, this of course should be based on actual costs incurred and be reasonable, but reasonable is a moveable feast in leasehold and LLs and agents find many ways to generate costs for even basic repetitive admin.
Big mistake is to read one court outcome as if that helps. In one case £45+Vat might be set, in another this will simply not do.
It is a scandal that forfeiture is available for breaches.
The whole caper is a scandal, mind.
I’ll bet a jam sandwich if you paid a barrister to go through your lease and explain every single clause and your rights and obligations under those clauses, you would be no more reliably safe as to understanding your situation. It’s not unlike the way a boss can find infinite ways to sack you if you vex him over something that itself is not a disciplinary offence.
Pays not to rattle any legal cages, the sound you hear will merely be your chains.
Paddy
Forfeiture is wrong as recognised by The Law Commission , The Law Society and the Council of Mortgage Lenders.
There is no reason why a financial breach by a tenant cannot be dealt with through the remedies of normal debt collection in the courts or via balliffs. In addition and in very narrow circumstances the concept of a forced sale by a tenant imposed by a judge is a principal I would agree with as recommended by the law commission.
The threat of Forfeiture,dating back to Feudal times , has become a ‘ sledgehammer to crack a nut’ and is wholly inappropriate in today’s modern world. It’s use as a threat by Landlords and managing agents is widespread however it’s implementation by the courts is minimal.
NOW is the time to abolish this shocking threat once and for all.
You mean to say ” Forfeiture is WRONGLY recognised by the Law Commission , the Law Society and council of Mortgage Lenders ” AND wrongly accepted because they support the Rule of Law.
The Feudal System was abolished in France in 1789 : Tell the leaseholders in E & W, we are 228 years behind France and the EU.
The National Constituent Assembly, acting on the night of 4 August 1789, announced, “The National Assembly abolishes the feudal system entirely.” It abolished both the seigneurial rights of the Second Estate (the nobility) and the tithes gathered by the First Estate (the Catholic clergy).
Abolition of feudalism in France – Wikipedia
https://en.wikipedia.org/wiki/Abolition_of_feudalism_in_France
The Feudal System was abolished in Scotland in 2004 . Tell the leaseholders in E & W , the MPs and our Housing Minister , we are 13 years behind Scotland.:
Abolition of Feudal Tenure etc. …
The feudal system of land tenure was brought to an end on 28 November 2004 when The Abolition of Feudal Tenure etc. (Scotland) Act 2000 was brought into force. On that date, the Act replaced the feudal system with a system of outright ownership of land.Dec 7, 2015
Abolition of Feudal Tenure etc. (Scotland) Act 2000
http://www.gov.scot/Topics/Justice/law/17975/Abolition
How to end our leasehold system in England & Wales ?
We should also look at other ways for leaseholders to buy their freeholds at a sensible cost. Ten times ground rent appears reasonable – already in place in Northern Ireland. Meanwhile, in Scotland I love the fact legislation rejecting leasehold doesn’t mince its words – it’s called the Abolition of Feudal Tenure (Scotland) Act 2000. Can we have the same in England and Wales, please?
Proposed by Patrick Collinson ( The Guardian Newspaper issue 29 July 2017 )
Seconded by : Every MP ( elected by their constituents in E&W ).
Ollie I know what I meant to say and said it clearly and concisely for all to understand.
Now get that petition shared and signed we need a surget- there a good fella.
Many of the companies in E&J Group seem to be LLPs which should be used by professionals to trade like Ltd companies but the income of the professional is declared on personal tax returns.
The LLPs don’t seem to report paying any 20% on their corporate profit derived from ground rent income.
Leaseholders must pay 20% and 40% tax rate on their earnings and if LLPs ( receiving ground rent income ) are allowed to dodge paying tax , we need to campaign for 100% ban on LLPs investing in ground rents from ownership of freehold titles..
I don’t understand why those leaseholders who bought flats let on ground rents that double ten yearly are not suing the solicitors who were paid to advise them what they were agreeing to at the time of purchase. It is encumbent on a solicitor to ensure that his or her client knows what they are signing up to.
Not that this excuses people like Taylor Wimpey and other highly experienced developers of letting some bright spark put this in their leases. ‘Wimps’ (as the staff there refer to the company) have got a problem as they have sold off these estates and cannot amend the leases. I suppose the money that they have set aside in connection with the complaints that are surfacing could be paid to cover statutory lease extension claims on behalf of those who bought these flats, because in extending the leases, the ground rent would be expunged. I suppose ‘Wimps’ could co-ordinate a mass set of s42 claims and underwrite the bill. Although it would be in absolute terms quite a large sum of money for them to blow, they seem committed to coughing up to fix this state of affairs. No doubt there are those on the Board who are furious to discover that their good name has been besmirched by however dreamed up this rather rapacious idea. A ground rent that doubles 25 yearly equates to an annual increase of2.9% pa compounded, and 33 yearly is 2.12%; neither of which would be problemmatic.
Another point of view, don’t get me wrong I realise their plight but Nobody took a gun to the head of these buyers and said “You must buy these flats” or “You must sign this lease”! The campaign has been successful in so far as the rent provisions are going to become far less onerous, without the leaseholders having to buy their way out of trouble, which is great news. But I remain surprised as to How can people make the most important financial commitment of their life to date without bothering to ascertain the terms of the lease that they were signing up to buy? Truly puzzling. And why aren’t they suing the solicitors who supposedly were advising them? Some of those affected are not original purchasers but assignees, who had no representations made to them by the Developers inducing them into the transaction.