Tenant Entitled to Purchase Freehold Reversion Under Leasehold Reform Act

OUTCOME: Allowed

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case Reference

:

CHI/40UC/OAF/2019/0009

Property

:

[ADDRESS] [POSTCODE]

Applicant: [redacted]

:

[COUNSEL], solicitors

Respondent: [redacted]

The successors in title of [COUNSEL] (missing)

Representative

:

Type of Application

:

Leasehold Reform Act 1967 (Missing Landlord)

Tribunal Member

:

[NAME] of Decision

:

2 September 2019

DECISION

Summary of Decision

The Tribunal has determined for the reasons set out below that the price payable by the Applicant for the freehold reversion of the property is to be the sum of £50.00 and the amount of unpaid pecuniary rent payable for the property up to the date of the proposed conveyance is nil.

2 Background

1. District Judge Field sitting at the County Court at Weston–super-Mare made an order dated 31 July 2019 directing that the First–tier Tribunal (Property Chamber) assess the appropriate sum in accordance with S27(5) of the Leasehold Reform Act 1967. (The Act)

2. A valuation report prepared by Mr [NAME].[NAME]. [NAME] dated 10 June 2019 has subsequently been provided.

3. An inspection of the property has not been made.

The Lease

4. The site is identified on the HM Land Registry plan edged red under title number ST69232 and is held by way of a lease for a term of 500 years from 8 April 1726 and made between [NAME] and [NAME] [NAME] and [NAME]. The lease is subject to a yearly rent in respect of the whole of the premises of £2.20s.6d.

5. Mr [NAME] in his valuation states that no ground rent is paid, the beneficiaries being unknown.

The Law

6. Section 27(5) of the Act provides: The appropriate sum which in accordance with Section 27(3) of the Act to be paid in to Court is the aggregate of: a. Such amount as may be determined by (or on appeal from) the appropriate Tribunal to be the price payable in accordance with Section 9 above; and b. The amount or estimated amount (as so determined) of any pecuniary rent payable for the house and premises up to the date of the Conveyance which remains unpaid.

7. Section 9 of the Act sets out in detail the assumptions to be made and the procedure to be followed in carrying out the valuation. The effect of Section 27(1) is that the valuation date is the date on which the application was made to the Court.

8. There are various bases set out in Section 9 of the Act and the Tribunal determines that the appropriate basis is in Subsection 9(1) being that on 31 March 1990 the Rateable value of the house and premises was not above £500.

9. The Tribunal has been referred to and takes account of the following decisions: Arbib v Cadogan (2005), [COMPANY] v Sportelli (2006) and [COMPANY] (2012).

The Premises

3 10. The property comprises a detached two-story house believed to have been constructed some 300 years ago.

11. The accommodation comprises an entrance porch, kitchen/diner, lounge and conservatory on the ground floor with two bedrooms and bathroom/ WC on the first floor. Outside there is an open front garden for parking and small side garden with enclosed rear garden. Gas fired central heating is installed.

Evidence and Decision

12. In a valuation report dated 10 June 2019 Mr [NAME] T [NAME] determined that the value for the purposes of Section 27 of The Act as at 22 May 2018 is £50.00.

13. Mr [NAME] made his determination on an open market value of the property of £275,000, a site value proportion of 25.00% (£68,750) a modern ground rent at 6% (£4,125.00) which he defers 207 years and capitalises the rent reserved at 7%. This produced the rounded sum of £50.00

14. Mr [NAME] supports his capital value with comparable sales evidence.

15. Without agreeing the constituent parts of Mr [NAME] valuation the Tribunal accepts his value of £50.00.

16. The Tribunal therefore determines that the amount to be paid for the freehold reversion of the property is £50.00.

17. The Tribunal determines that the amount of unpaid pecuniary rent payable for the property up to the date of the proposed conveyance is nil.

D [NAME]

2 September 2019

1. A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application to the First-tier Tribunal at the Regional office, which has been dealing with the case. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

2. If the person wishing to appeal does not comply with the 28-day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28-day time limit; the Tribunal will then decide

4 whether to extend time or not to allow the application for permission to appeal to proceed.

3. The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.