The Taylor Wimpey ground rent scandal featured in the Sunday Times yesterday, as it emerges that executives are being sent out to visit the complaining leaseholders.
The article was in the form of a reader’s letter from a £130,000 leasehold house owner in Bolton facing doubling ground rents from an initial £250.
Garry Evans says these rise to £500 a year from January and asked whether he could challenge it.
Solicitor Paul Greatholder, of Russel Cooke solicitors, said this was unlikely as consumer rights law in this area is largely untested. He referenced the 2015 Arnold v Britton case in the Supreme Court where service charges spiralling to hundreds of thousands a year were deemed lawful.
Sebastian O’Kelly, Trustee of the Leasehold Knowledge Partnership, advised Mr Evans to make as much noise as he could through national and local media and MPs. The Taylor Wimpey ground rent scandal has already featured in several newspapers, radio and, it is anticipated, TV.
The short article referenced the chairmen of the All Party Parliamentary Group on leasehold reform, Sir Peter Bottomley and Jim Fitzpatrick, calling on Taylor Wimpey to make these leases fair.
Separately, the company is sending our executives to meet the noisier complainants who have been caught up in the ground rent scandal.
This is part of the “review” promised by Taylor Wimpey CEO Pete Redfern to the MP chairmen.
It is not at all clear what the purpose of these visits will be, beyond risk assessment to the company and information gathering.
The terms of the lease and how many people are affected by them will be well known to Taylor Wimpey, even though it is most scrupulous in thanking LKP for “bringing the matter to our attention”.
A key issue here is that all the leaseholders affected who have contacted LKP used solicitors’ firms that were recommended by the housebuilder.
That is not look good.
At the outset of the downturn in 2008 a number of purchasers of Berkeley Group flat buyers did not complete their purchases.
They formed a protest group and interested the press and MPs.
Some newspapers – the Evening Standard in London – were very sympathetic; other journalists (including were Mr O’Kelly) were sceptical that some of the defaulting buyers were disgruntled buy-to-let buyers who did not want to complete on what was now a dud investment.
The key argument concerned the use of solicitors recommended by the housebuilder.
In the event, the issue was solved and silenced with “non-disclosure agreements” (NDAs).
Related posts:
Taylor Wimpey ground rent explanation ‘not true’, BBC is told
‘Fright night’ for Taylor Wimpey as profits fall 24% over leasehold scandal, says Times
Guardian reports the Taylor Wimpey £130m offer to settle ground rent scandal
Pete Redfern: Stop pontificating about the housing crisis and sort out the ground rent scandal of Taylor Wimpey’s own making
Taylor Wimpey to pay £130 million to solve doubling ground rent scandal
End lease extension ‘injustice’, veteran MP urges Commons
I hope that when these Taylor Wimpey executives visit the unfortunate customers, they bear in mind some clauses contained within their Customer Charter.
1 We have a longstanding commitment to our customers to make sure that their new house lives up to their expectations.
2 Buying a house is the most important financial decision you are ever likely to make.
3 We strive to ensure all our marketing and advertising is clear and truthfull and use clear and fair terms and conditions in our sale contract.
The English Leasehold laws are skewed in favour of ‘corporate’ Landlords who have the resources to bludgeon leaseholders into submission, or ‘steal’ their properties if they cannot afford to pay.
We own on a large development in Wakefield, where we discovered that we had signed our leases showing our Ground Rent was £150 pa, but by the time we completed, the Ground Rent had been changed without our consent to £250 pa. Our solicitor, Powell Callen, did not bring this to our attention and, of course, they have now gone bust (after taking £millions in fees). We have no recourse!
Yet another cost which will be passed to ‘Just About Managing’ tenants!
Are Taylor Wimpey, who are wholly responsible for instigating these horrendous leases in the first place, going to give a satisfactory conclusion to just the few who have complained, or will it be for ALL the leaseholders, including the ones that leases increase by RPI.
Obviously I am sure we are expected ALL leaseholders of these houses to be given acceptable terms (Transfer to Freehold – absolutely no reason in this world, other than greed, for houses to be leasehold)
How abysmal for TW to thank LKP for bringing this matter to their attention!! Did TW not know what their leases said when they sold them to these poor purchasers.
Don’t know who stated it first, but to call these leaseholders “unfortunate” is such a dress down of description of the state they are really in, again, is a disgrace
Presumably the majority of these houses will have been bought with mortgage finance which demonstrates that: 1) There is no effective mechanism for the adverse lease terms to have been reflected in the Mortgage Valuation 2) The lenders guidelines to solicitors have failed to protect both the purchaser (mortgagor) and the lender (mortgagee). The result is that the purchasers have bought a dud and the lender has lent against diminished security. Lenders should require conveyancers to fully consider adverse lease terms and refer a valuation back to the mortgage valuer for comment or revision when necessary. For purchasers it seems no-one else in the process cares about them. The only option is to obtain their own independent advice from specialist leasehold practioners. An additional expense and fr from ideal but the downside of not doing so may be much more severe….
CEO of RCP Ltd ”boasts’ online that its ‘Ground Rent fund Coast Freehold income fund’ 1s up 13.69% and the “pipeline keeps growing”. I looks to me that they purchase 2 ground rents per month,paying between 300’000 and 1.. 2 million per property. I wonder who’s funding this. Bank of mum and Dad?
I believe Nominee directors are used to buy the above Freehold./ ground rent
Look at Railway and bicycle co Ltd for starters. The Freehold was purchased from the developer in 2015 when the building had been completed. I do not know if the leaseholders were given first refusal, but doubt it. I have no evidence that is the case. Alison Mooney of Westbury residential was appointed director. She is also the ‘director’ of Westbury Residential Ltd whose major shareholder is the CEO of RCP Ltd. Alison Mooney is listed at companies house as having been director of at least 49 companies over approx 10 years. All the companies I believe were connected to RCP Ltd. Why are CEO of companies allowed to hide behind nominee directors? What is there to hide?
There has to be a lot to hide. Unfair clauses such as doubling ground rent should be made void, through an Act of Parliament. End of story. We should be updating the whole unfortunate residential freehold system. Before every other dodgy freeholder/offshore investor ups their game…They talk about a housing crisis and then they shut their eyes at this!
I believe/ hope that this is the beginning of the end of these Rachmanesque practices. The people are waking up and are ready to revolt! The dodgy operators who make leaseholders lives a misery, had better get ready to get poorer!! Reprehensible bunch! Next, LKP should target the venal managing agents,
Ground Rent abuse, whether it be new build or the illegal sale of existing long leaseholds, is a major national scandal perpetrated by unscrupulous carpetbaggers and their accommodating legal adviser vagabonds.
Thankfully, these now well documented and willful scamming practices are finally emerging from the gutter.and into the plain light of day.
The Law Commission has indicated that it has adopted Leasehold Reform as part of the work programme of the 13th Programme of Law Reform, and it would help if LKP/Campaign against retirement leasehold exploitation could ensure this includes Ground Rent abuse in all its forms..
In the meantime, we must bring an immediate end to the criminal activities of the unscrupulous Rachmanist few who still persist. in the muddy and murky end of this extremely dodgy business.
Well put Alec.
Lest you forget Crusader,the CEO of RCP was the CEO of County Estate Management the utterly disgraced ‘ manangement company’ that went into liquidation in 2011.They were hugger mugger with peverel. See ruling, it make gruesome reading. They changed their name to ‘Westbury Residential Management Ltd’. Why is the CEO of Westbury resi buying up vast amounts of ground rents and paying up to 1.2mill for one property alone? Maybe it was a hotel? I notice that a block of 67 flats as far afield as Bradford has been purchased by ” Ground rent coast/ Freehold fund” ( RCP) Why? What’s in it for them? Are the leases arriving at the 80yr mark or is it a new build and are they looking to quadruple the ground rent? It is also bragged online that they need to build “New Towns” not just houses. RCP Ltd also do new build. . Cor- Loadsamoney!!!