So often we find ourselves advising people to read their lease if they need to find out about covenants and the respective responsibilities of landlord (freeholder) and tenant (leaseholder). Many time-consuming and expensive disputes could surely be avoided if both parties were fully aware of the terms of the lease?
If you have a query or think a dispute is pending, you really do need to know what the lease says and what your position is – but do you actually have a copy of it or know where to get hold of one? Even if you do, are you sure it is up to date with any variations that have been made over the years?
What is a lease?
When you buy a leasehold flat you are, in fact, ‘only’ buying the right to occupy it for the duration of the lease, subject to you meeting certain obligations, which will be specified in the lease. They typically relate to sharing the costs of upkeep and management, being reasonably quiet during night hours, not obstructing corridors, not running a business from the premises, etc. There may be specific requirements such as laying sound insulating floor coverings. The lease also tells you what the landlord (freeholder) is required to do in exchange: typically insuring the building, maintaining the common areas, etc.
There will likely be a sweeping-up clause allowing the landlord (or management company) to recover costs for additional services or costs that might not have been contemplated when the lease was granted. The wording will usually specify that it covers expenditures incurred by a lessor in carrying out its specific obligations under other clauses of the lease and any other costs and expenses reasonably incurred. These costs can be challenged if they are not reasonable.
Remember, a lease is not a proof of ownership – more about that below.
Where is my lease?
While you agreed to the lease terms when you bought your flat, you probably didn’t actually sign a lease document. Nevertheless, your conveyancing solicitor should have given you a copy and explained it to you to make sure you understand your obligations.
You will also have been advised, as they happen over the years, of any variations to the lease affecting you following, say, a successful right to manage the application if all or some leaseholders have bought the freehold.
For leaseholders, buying the freehold is a golden opportunity to sort out outdated lease terms, clarify sub-letting to exclude short-term lets like AirBnB, effectively get rid of ground rent by reducing it to a peppercorn (if demanded), and grant the people who have invested in buying the freehold longer leases, etc. In that case, new clauses are often added to override old clauses and the solicitor dealing with the matter will advise all affected leaseholders. You are unlikely to get a whole new lease, and it may be that, even with the best will in the world, the different documents (original lease and any variations) get separated.
So, yes, it’s easy to lose track. Thankfully, it’s also easy to get hold of a copy of your lease.
Where do I go to get a copy of my lease?
The short answer is that it is quick and easy.
The freeholder and, if there is one, managing agent, should have copies to hand. After all, how else can they be sure to manage appropriately? However, they could charge an administration fee for producing a copy.
Similarly, your solicitor may have a copy on file but again will probably need to charge a fee to send you a copy.
The easiest and perhaps least expensive option is to apply directly to the Land Registry, which holds copies of leases for all registered leasehold properties in England and Wales where the lease was granted for a term of 7 years or longer.
You can make a postal application using form OC2. The current fee is £7.
An alternative, slightly more expensive option is to go to a provider with a commercial account with the Land Registry who will let you go through the whole ordering and payment process online and will supply an Official Copy of the lease by email, usually within an hour of ordering.
What other documents might I need?
As we said above, a lease is not proof of ownership. For that you will need an Official Copy of the Title Register and that, too, is readily available from the Land Registry using form OC1. It is a guaranteed copy of the land register.
This is because a lease creates a leasehold interest in the property for a fixed period of time and will only show the name of the first leaseholder. Whenever the property changes hands, the new purchaser simply becomes obligated by the terms of the original lease as if they were the original tenant. Their name is not added to the lease.
That’s why, In order to prove ownership of a property (freehold or leasehold), you will always need an Official Copy of the Title Register.
The Land Registry can also supply you with the following documents (for any Property, not just your own):
A property summary including:
- The property’s address – the address held by Royal Mail
- The property description
- The ‘tenure type’ – the type of ownership the property has
- Whether there are any ‘restrictive covenants’ – promises to not do certain things with the land, like not building on a particular area.
- Whether there are any ‘easements’ – the rights of one piece of land over another, like a right of way
A title register (this is NOT an Official Copy) including:
- The title number
- Who owns the property
- How much the property was last sold for
- Whether the property has a mortgage
- Details of any ‘restrictive covenants’ and ‘easements’
A title plan including the property’s location and general boundaries.
No one wants to get involved in disputes, but when you do, you really do need to know what the lease says and what it means in practice. If you have legal expenses insurance cover, you can get more advice from your insurers. Check out the Gallagher Legal Expenses insurance solution here.
Disclaimer:
The opinions and views expressed in the above articles are those of the author only and are for guidance purposes only. The authors disclaim any liability for reliance upon those opinions and would encourage readers to rely upon more than one source before making a decision based on the information
The sole purpose of this article is to provide guidance on the issues covered. This article is not intended to give legal advice, and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and/or market practice in this area. We make no claims as to the completeness or accuracy of the information contained herein or in the links which were live at the date of publication. You should not act upon (or should refrain from acting upon) information in this publication without first seeking specific legal and/or specialist advice. Arthur J. Gallagher Insurance Brokers Limited accepts no liability for any inaccuracy, omission or mistake in this publication, nor will we be responsible for any loss which may be suffered as a result of any person relying on the information contained herein.
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