Tenant Secures Lease Extension Despite Missing Landlord

OUTCOME: Allowed

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : LON/00AY/OLR/2025/0928 Property :

[ADDRESS] [POSTCODE]

Applicant: [redacted] : [COUNSEL] (Solicitors) Respondents : [redacted] : Determination of terms of lease extension (missing landlord) Tribunal Member :

[NAME]

Date of Decision :

26 November 2025

DECISION

Decision The premium to be paid by the applicant for the lease extension for [ADDRESS] [POSTCODE] ([NAME]) under HM Land Registry title number SGL389582 is £ 62,000 (Sixty two thousand pounds) . The draft deed attached to the applicant’s bundle, is approved.

Introduction 1. This is an application made under Section 50 and 51 of the Leasehold Reform, Housing and Urban Development Act 1993 (“the Act”) for a determination of the premium to be paid and the terms of an acquisition of an extension to the leasehold interest in [NAME]. The relevant legal provisions are set out in Appendix to this decision.

2 2. [NAME] in [ADDRESS], (South London) near the railway station, is a self contained second (top) floor flat within a former late nineteenth century semi-detached, brick walled and tiled roof house; since converted on 3 levels into flats. [NAME] shares an external common pathway to a communal front door at ground floor and thence via a shared internal stairway. There is no outside space included in the demise. The building is in an older well established residential area in LB Lambeth near to the [ADDRESS].

3. The Applicant is the long leaseholder of [NAME] and holds their interest under the terms of a lease dated 24 June 1982, registered under title number SGL384582. That lease was granted by the then freeholder for a term of 99 years from that date. The lease reserves an initial ground rent of £30 pa for 33 years, rising to £60 pa for the next 33, rising to £90 pa for the last 33 years. The residual term of the lease is now vested in the applicant, registered as leasehold proprietor.

4. The Respondent is registered freehold proprietor of [NAME] under title number SGL79296.

5. By orders made by District Judge Bishop in the County Court at Croydon on 4 and 7 July 2025 and on the Court being satisfied that the respondent could not be found, the matter was referred to this Tribunal for determination of the price and other terms of a lease extension under S.51(5).

6. The Tribunal approves the form of surrender and renewal. It refers this case back to the Court so that the new lease will be executed by a Judge of the County Court, in accordance with S.51(3) of Leasehold Reform Housing and Urban Development Act 1993.

7. The Tribunal considered the issue on the papers submitted by the applicants, without a hearing, in accordance with Directions issued on receipt by the Tribunal, of the orders from the County Court. The case was to be determined on the bundle papers subsequently in 2025. The Tribunal’s jurisdiction is derived from the orders. Statutory Basis 8. Part 2, Schedule 13 to the Act provides that the price to be paid by the leaseholder, the applicant for the new leasehold interest where there is no intermediary head leaseholder, applies here.

9. The premium payable in respect of the grant of a new lease is the total of: (a) the diminution in value of the landlord’s interest in the tenant’s flat as determined in accordance with paragraph 3, (b) the landlord’s share of the marriage value as determined in accordance with

3 paragraph 4, and (c) any amount of compensation payable to the landlord under paragraph 5.

10. The diminution is: 3(1) The diminution in value of the landlord’s interest is the difference between (a) the value of the landlord’s interest in the tenant’s flat prior to the grant of the new lease; and (b) the value of his interest in the flat once the new lease is granted.

11. Paragraph 4 of the Schedule, as amended, provides that the freeholder's share of the marriage value is to be 50%, and that any marriage value is to be ignored where the unexpired term of the lease exceeds eighty years at the valuation date. Here it is included as the unexpired term is less than eighty years.

12. Paragraph 5 of the Schedule provides for the payment of compensation for other loss resulting from the enfranchisement. Evidence 13. The applicant provided a valuation report dated 31 October 2025, by [NAME] [NAME] [NAME] of [NAME] of [ADDRESS], [POSTCODE]. (“Valuation Report” or “Report”).

14. Having considered the contents of the Valuation Report and the opinions expressed by [NAME], the Tribunal is satisfied that the method adopted is appropriate to determine the premium for the new lease for [NAME]. The Tribunal accepts the description of [NAME] and its location as stated.

15. A photograph of the front exterior of [NAME] within the building of which it forms part, was included in the Valuation Report. The Tribunal did not consider it necessary or proportionate to carry out an inspection of [NAME]. Valuation 16. As reported, the second floor flat No.5c consists of: Rights over a shared ground level path, outside entrance door, hallway and stairs to [NAME]. This is a small (c.59m2) 2/3 bedroom flat and being attic rooms in part and so includes some restricted height spaces. Accommodation comprises 4 rooms - 2 small doubles, 1 small single bedroom, living room/ kitchen, bathroom & WC. Windows are timber framed, single glazed throughout. There is no mention of central heating.

4 17. There was no mention of tenants improvements, the value of which is to be deducted. There was also no mention of any tenant default in their lease obligations, the effects of which on value, are be ignored.

18. The antecedent valuation date (AVD) prescribed by section 51(1) of the Act is the date of the application to Court namely 8 May 2024. [NAME] has adopted the date of the Court Order itself, 24 May 2024. The unexpired residue of this lease is 57.08 years at AVD 24 May. 19. [NAME]’s assessment of the market value of the flat is based on evidence and analysis of completed sales of 3 nearby comparable properties. 20. [ADDRESS]24 sold £510,000, April 2024, 82m2, £6222/m2, converted flat on second and third floors in a former house. Same road as [NAME], good condition, 153 years unexpired, peppercorn rent.

21. Second floor Flat, [ADDRESS]24 sold £470,000, April 2024, 64m2, £7344/m2, converted flat, 2 bedrooms, in a former house. Same road as [NAME], good condition, 998 years unexpired , peppercorn rent. 22. [ADDRESS]2 sold £485,000, April 2024, 72 m2 £6736/m2, converted flat, 3 bedrooms, in a former house. 0.2miles south of [NAME], reasonable condition, 138 years unexpired, peppercorn rent.

23. The mean average unit price of these 3 sales all very near to the location and to the AVD, devalues to £6767/m2 overall, without adjustment. Applied to the floor area of the [NAME] at 59m2 gives £400,000. [NAME] makes a small adjustment upwards, primarily for the smaller size here, in effect adding 5%. There are no other adjustments.

24. Overall the Tribunal is satisfied with the relevance and detail of the comparable property sales, as provided in the Valuation Report taking each with equal weighting. It accepts [NAME]’s analysis of each in assessment of value of a new long lease here as £420,000.

25. The Tribunal notes and accepts the 1% adjustment by [NAME] in uplifting the extended long lease value to its notional freehold value of £424,200.

26. As for relativity between short and long leasehold values for the unexpired term, [NAME] considered and adopted the use of graphs from the [NAME] case of 2020. [NAME] takes a Relativity percentage of some 76.17% on 57.08 years unexpired here for the short

5 leasehold value. When applied to the FHVP value for [NAME], of £424,200 and gives a short leasehold value of £323,113.

27. The Tribunal accepts these steps and the conclusions.

28. The diminution in the value of the landlord's interest in the tenant’s flat is represented first by the capitalised value of the ground rent receivable under their lease, now at £60 and later £90 pa after the last fixed review. The calculations of these modest rents at 7% capitalisation yield referenced in the report, are adopted.

29. Secondly the effect of the lease extension will deprive the landlord of [NAME] for a further 90 years in addition to the current unexpired term. The present value of that delayed reversion is determined by applying a deferment rate to the freehold value of the flat. The deferment rate appropriate for leasehold flats in Central London was authoritatively determined to be 5% in the case of [NAME] v [NAME] (2006) LRA/50/2005. [NAME] also adopts the [NAME] deferment rate of 5% for this flat, which the Tribunal accepts.

30. The marriage value is then to be shared equally between the parties, 50:50 as required by the Act.

31. The Tribunal approves the assumptions, form, content and layout of the valuation set out the Report. The Tribunal finds the report refreshingly focused and pithy, without superfluity. Whilst still including significant evidence in form of sales [NAME], photographs, floor plans, EPC reports, HMLR title records etc. in support of the transactions referenced therein, there is a pleasant absence of irrelevant material on areas of the market, valuations and law that in this case are uncontroversial; for which the Tribunal is grateful. It therefore does not produce its own valuation.

32. The premium to be paid by the applicant for the new lease of [NAME] is therefore determined at £62,000. (Sixty two thousand pounds). The draft deed attached to the applicant’s bundle is approved. Name: [APPELLANT]: 26 November 2025

6 Appendix

Leasehold Reform, Housing and Urban Development Act 1993

S.50 Applications where landlord cannot be found. (1) Where— (a) a qualifying tenant of a flat desires to make a claim to exercise the right to acquire a new lease of his flat, but (b) the landlord cannot be found or his identity cannot be ascertained, the court may, on the application of the tenant, make a vesting order under this subsection. (2) Where— (a) a qualifying tenant of a flat desires to make such a claim as is mentioned in subsection (1), and (b) paragraph (b) of that subsection does not apply, but (c) a copy of a notice of that claim cannot be given in accordance with Part I of Schedule 11 to any person to whom it would otherwise be required to be so given because that person cannot be found or his identity cannot be ascertained, the court may, on the application of the tenant, make an order dispensing with the need to give a copy of such a notice to that person. (3) The court shall not make an order on any application under subsection (1) or (2) unless it is satisfied— (a) that on the date of the making of the application the tenant had the right to acquire a new lease of his flat; and (b) that on that date he would not have been precluded by any provision of this Chapter from giving a valid notice under section 42 with respect to his flat. (4) Before making any such order the court may require the tenant to take such further steps by way of advertisement or otherwise as the court thinks proper for the purpose of tracing the person in question; and if, after an application is made for a vesting order under subsection (1) and before any lease is executed in pursuance of the application, the landlord is traced, then no further proceedings shall be taken with a view to a lease being so executed, but ([NAME] to subsection (5))— (a) the rights and obligations of all parties shall be determined as if the tenant had, at the date of the application, duly given notice under section 42 of his claim to exercise the right to acquire a new lease of his flat; and (b) the court may give such directions as the court thinks fit as to the steps to be taken for giving effect to those rights and obligations, including directions modifying or dispensing with any of the requirements of this Chapter or of regulations made under this Part.

7 (5) An application for a vesting order under subsection (1) may be withdrawn at any time before execution of a lease under section 51(3) and, after it is withdrawn, subsection (4)(a) above shall not apply; but where any step is taken (whether by the landlord or the tenant) for the purpose of giving effect to subsection (4)(a) in the case of any application, the application shall not afterwards be withdrawn except— (a) with the consent of the landlord, or (b) by leave of the court, and the court shall not give leave unless it appears to the court just to do so by reason of matters coming to the knowledge of the tenant in consequence of the tracing of the landlord. (6) Where an order has been made under subsection (2) dispensing with the need to give a copy of a notice under section 42 to a [NAME] with respect to any flat, then if— (a) a notice is subsequently given under that section with respect to that flat, and (b) in reliance on the order, a copy of the notice is not to be given to that person, the notice must contain a statement of the effect of the order. (7) Where a notice under section 42 contains such a statement in accordance with subsection (6) above, then in determining for the purposes of any provision of this Chapter whether the requirements of Part I of Schedule 11 have been complied with in relation to the notice, those requirements shall be deemed to have been complied with so far as relating to the giving of a copy of the notice to the person referred to in subsection (6) above.

51 Supplementary provisions relating to vesting orders under section 50(1). (1) A vesting order under section 50(1) is an order providing for the surrender of the tenant’s lease of his flat and for the granting to him of a new lease of it on such terms as may be determined by a leasehold valuation tribunal to be appropriate with a view to the lease being granted to him in like manner (so far as the circumstances permit) as if he had, at the date of his application, given notice under section 42 of his claim to exercise the right to acquire a new lease of his flat. (2) If a leasehold valuation tribunal so determines in the case of a vesting order under section 50(1), the order shall have effect in relation to property which is less extensive than that specified in the application on which the order was made. (3) Where any lease is to be granted to a tenant by virtue of a vesting order under section 50(1), then on his paying into court the appropriate sum there shall be executed by such person as the court may designate a lease which— (a) is in a form approved by a leasehold valuation tribunal, and

8 (b) contains such provisions as may be so approved for the purpose of giving effect so far as possible to section 56(1) and section 57 (as that section applies in accordance with subsections (7) and (8) below); and that lease shall be effective to vest in the person to whom it is granted [NAME] expressed to be demised by it, [NAME] to and in accordance with the terms of the lease. (4) In connection with the determination by a leasehold valuation tribunal of any question as to [NAME] to be demised by any such lease, or as to the rights with or [NAME] to which it is to be demised, it shall be assumed (unless the contrary is shown) that the landlord has no interest in property other than [NAME] to be demised and, for the purpose of excepting them from the lease, any minerals underlying that property. (5) The appropriate sum to be paid into court in accordance with subsection (3) is the aggregate of— (a) such amount as may be determined by a leasehold valuation tribunal to be the premium which is payable under Schedule 13 in respect of the grant of the new lease; (b) such other amount or amounts (if any) as may be determined by such a tribunal to be payable by virtue of that Schedule in connection with the grant of that lease; and (c) any amounts or estimated amounts determined by such a tribunal as being, at the time of execution of that lease, due to the landlord from the tenant (whether due under or in respect of the tenant’s lease of his flat or under or in respect of any agreement collateral thereto). (6) Where any lease is granted to a person in accordance with this section, the payment into court of the appropriate sum shall be taken to have satisfied any claims against the tenant, his personal representatives or assigns in respect of the premium and any other amounts payable as mentioned in subsection (5)(a) and (b). (7) [NAME] to subsection (8), the following provisions, namely— (a) sections 57 to 59, and (b) section 61 and Schedule 14, shall, so far as capable of applying to a lease granted in accordance with this section, apply to such a lease as they apply to a lease granted under section 56; and subsections (6) and (7) of that section shall apply in relation to a lease granted in accordance with this section as they apply in relation to a lease granted under that section. (8) In its application to a lease granted in accordance with this section— (a) section 57 shall have effect as if— (i) any reference to the relevant date were a reference to the date of the application under section 50(1) in pursuance of which the vesting order under that provision was made, and (ii) in subsection (5) the reference to section 56(3)(a) were a reference to subsection (5)(c) above; and

9 (b) section 58 shall have effect as if— (i) in subsection (3) the second reference to the landlord were a reference to the person designated under subsection (3) above, and (ii) subsections (6)(a) and (7) were omitted.

Rights of appeal

By rule 36(2) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, the tribunal is required to notify the parties about any right of appeal they may have.

If either party is dissatisfied with this decision, they may apply for permission to appeal to the Upper Tribunal (Lands Chamber) on any point of law arising from this Decision.

Prior to making such an appeal, an application must be made, in writing, to this Tribunal for permission to appeal. Any such application must be made within 28 days of the issue of this decision to the person making the application (regulation 52 (2) of The Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rule 2013).

If the application is not made within the 28-day time limit, such application must include a request for an extension of time and the reason for not complying with the 28 day time limit; the tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed, despite not being within the time limit.

The application for permission to appeal must identify the decision of the tribunal to which it relates (i.e., give the date, [NAME], and the case number), state the grounds of appeal and state the result the party making the application is seeking.

If the tribunal refuses to grant permission to appeal, a further application for permission may be made to the Upper Tribunal (Lands Chamber).