By Harry Scoffin
Four leasehold house owners in the former pit village of Thurcroft, near Rotherham, south Yorkshire, are bracing themselves for disappointment after almost six years of ground rent war.
Their former National Coal Board homes on 200-year leases saw ground rents leap from £10 a year to a demand for £2,450.
After arbitration in January, the figure has been reduced to £1,100, which the leaseholders are still disputing and the first-tier tribunal will make a ruling.
The revised ground rents on properties worth around £80,000 would still mean they were unsellable to anyone buying with a mortgage.
An earlier tribunal had ruled that ground rents of £115 would be in line with inflation after 50 years, which the leaseholders accepted.
But the figure was too small for freehold owner Coppen (Estates) Limited, whose directors are given as Alan Copley Pennington, Shirley Pennington and Alan Shaun Pennington, and the matter is back with the tribunal.
The dispute has involved a succession of dramas including involving self-representation at tribunal, arbitration, cancer, Alzheimer’s and a heart attack – and has been raised with Communities Secretary Robert Jenrick.
Alexander Stafford, Conservative MP for Rother Valley, asked Mr Jenrick in March about the government’s policy on ground rents.
“I wish to enquire whether the Government considers an increase of 24,100% [to £2,450pa] to be fair or equitable, and for such a proposed increase to be acting in good faith and in the spirit of the laws governing leaseholds,” he wrote.
Dennis Plant, 66, who has been leading the fight with wife Heather, 55, says his life has been blighted by the shock ground rent increase. In October 2014, he was notified that it would be rising from £10 to £2,450 per annum.
“I was diagnosed with bladder cancer two years ago. This leasehold situation hasn’t helped me one bit. It’s in my brain all the time. For six years, our lives have been hell. I have been up in the middle of the night researching, trying to get us help.
“I have worked 12 hours, 7 days a week to pay my mortgage when we had kids, and it feels like they’re just wanting to come and take our houses off us because of these feudal laws.”
Over six years, Mr Plant says he asked Coppen (Estates) Limited to confirm the name of the professional who set the original valuation, but has received no response.
In March 2017, the leaseholders served notice on the landlord to buy the freeholds, but there was no agreement on price and the issue went to the tribunal.
After their solicitor quit days before the hearing, the leaseholders, who are pensioners, had to represent themselves.
In the run up to the June 2019 court date, David Alan Senior, one of the leaseholders, was printing paperwork for the case when he had chest pains and was rushed to hospital. The tribunal noted that “Mr Senior is seriously ill” in its determination. In fact, Mr Senior went on to have a triple heart bypass.
At the hearing, Coppen (Estates) Limited argued that despite the terms of the 1960s-era leases, the tribunal had jurisdiction to rule on what the ground rent should be as part of valuing the freeholds.
The leases did not specify by how much the ground rent should increase by on the fiftieth, one hundredth and one hundred and fiftieth year rent review periods.
“The Tribunal disclosed to the persons present that compound interest on ground rent of £10 per year, at 5%, over 50 years, equals £114.67, rounded up to £115,” said the determination.
The leaseholders were ready to accept £115 ground rents, but:
“The Applicant took the view that this was entirely the wrong approach to take to the issue of setting a value for the ground rent,” the tribunal noted.
Coppen (Estates) Limited had earlier refused to go down the arbitration route.
The tribunal sent the parties away to agree on an arbitrator “competent to set a ground rent in these circumstances”.
In an arbitration ruling issued in January, the freeholder’s demands were halved and the ground rent went from £2,450 to £1,100 per annum.
The site value, which is used to calculate the ground rent, was brought down from £44,000 to £23,000.
The first-tier tribunal now has to decide whether it agrees with the joint surveyor-arbitrator’s ground rent figure, which is likely to keep the houses unsellable, or to get closer to £115 ground rents in determining the freehold valuation.