Tenant Secures Statutory Lease Extension Despite Unlocatable Landlord

OUTCOME: Allowed

© CROWN COPYRIGHT 2014

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference :

NAT/LON/00AY/OLR/2023/0202

Property :

31b [ADDRESS] [POSTCODE]

Applicant : [redacted] : [COUNSEL] [NAME] Respondent : [redacted] : Not applicable (missing landlord) Type of application : Application under sections 50 and 51 of the Leasehold Reform Housing and Urban Development Act 1993 Tribunal member :

[NAME] [NAME] : 10 [ADDRESS] [POSTCODE] Date of paper determination : 7 November 2023

DECISION

2 Decisions of the Tribunal (1) The tribunal determines that the price to be paid by the applicant for the new lease on statutory terms is £34,950. The Background 1. This is an application under section 50 and 50(1) of the Leasehold Reform Housing and Urban Development Act 1993 (“the 1993 Act”) pursuant to an order made by District Judge Keating sitting at the County Court at Croydon on 8th February 2023 (“the order”).

2. Sections 50 and 50(1) of the 1993 Act concerns claims for a statutory lease extension where the relevant landlord cannot be found. It enables the court to make a vesting order in respect of any interests of the landlord which are liable to acquisition.

3. Under section 51 of the 1993 Act, the role of the tribunal is to determine the appropriate sum to be paid into court in respect of the landlord’s interests.

4. The applicant in this matter is [APPELLANT]. They are the qualifying tenants of 31b [ADDRESS] [POSTCODE] (“the Property”). The respondent freehold owner is Ms [APPELLANT].

5. On 23 December 2022 the applicant issued a Part 8 Claim at the County Court at Croydon for an order pursuant to Section 50 of the 1993 Act so that the applicant could exercise the right to acquire a new lease for the property. The applicant has been unable to ascertain the whereabouts of the respondent.

6. The applicant subsequently applied for a vesting order under section 50(1) of the 1993 Act. The order dispensed with the statutory requirement to serve a section 42 notice on the Defendant pursuant to section 50(2) of the Act. The vesting order was granted subject to the determination of this tribunal.

7. The applicant has provided the tribunal with a valuation report prepared by Ms [NAME] BA MRICS RICS Registered Valuer dated 7th August 2023.

8. Ms [NAME] is of the view that the premium to be paid for the new leasehold interest is £30,400 as at the valuation date adopted in his valuation of 23 December 2023.

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The Determination 9. The Tribunal accepts the opinions expressed by Ms [NAME] in her valuation report dated with 7th August 2023 save that: (i) The tribunal has reviewed the comparable transaction evidence submitted to support the opinion that the long leasehold value of the property is £232,000. They have scrutinised the evidence offered in the Expert Valuation report and based upon their knowledge and experience made further adjustments to the basket of the supporting comparable transaction evidence.

(ii) The tribunal note the transaction evidence submitted by the Expert produces unadjusted property values of between £241 per ft² and £586 per ft². This is a wide dispersion of value and to overcome this difficulty the tribunal has discarded the outlier transaction evidence. Four properties are selected to create a smaller basket of comparable properties more closely aligned in value. These are also preferred due to their location, sale status and similarity to the subject property. The addresses of the selected properties is shown in table 1.

(iii) The tribunal apply revised adjustments to the sale prices of the dwellings included within the valuation bundle. These reflect the comments presented in Schedule of Comparable Evidence Appendix E of the Expert Report at page 91 of the bundle. The tribunal analysis of the reduced comparable evidence is also shown below at table 1.

(iv) The revised analysis produces an average value per ft2 of £501ft2 and a long leasehold value of £260,000. This value is adopted in the revised premium calculation.

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10. The adjusted calculation has resulted in a premium of £34,950. A copy of the Tribunal’s valuation is attached to this decision.

11.

Accordingly, the premium payable is £34,950 less the summarily assessed costs of £4,692.14 confirmed by Order dated 27 June 2023 shown at pages 140-141 of the bundle.

12. This matter should now be returned to the County Court sitting at Croydon under Claim Number Ko1CR106 in order for the final procedures to take place. [NAME] 7 November 2023

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