Disposal of freehold interest

[Easy]

This was a question recently sent to the Legal Solutions Homes & Property lawyer in the Homes & Property Section of the Evening Standard.

Q."I own one of the two flats in a property. The landlord sold the ground floor flat along with the freehold in 2000 without notifying me. I have 78 years on my lease."
A."Where a disposal of a freehold interest is taking place, then the freeholder must offer the freehold on the same terms to all qualifying tenants. A long leaseholder such as yourself would in most cases be a qualifying tenant and it may be that you should have received notice. If the freehold has been disposed of without complying with these provisions contained in the Landlord and Tenant Act 1987 then you may be entitled to compel the new freehold owner to sell to you at the price paid.

There may be a limitation period during which you are required to take action and therefore you will need to seek specialist advice".

Can anybody add anymore to this answer please:

1. What is a qualifying tenant? What if the freeholder had been in residence in the flat at the time of disposal rather than non resident?
2. What is the time limitation to take action?

[Richard Webster]

I think you are out of time now, but even if in time, you have the problem that the right of first refusal is exercisable by more than 50% of the flat owners.

As there are only two flats you cannot have more than 50%. Therefore even if the notices had been served etc you would not have been able to compel sale of the freehold because presumably the other flat owner (who was selling ) would not have joined with you in serving the counter-notice!

[jeffrey]

1. What is a qualifying tenant? What if the freeholder had been in residence in the flat at the time of disposal rather than non resident?
2. What is the time limitation to take action?
1A. "Qualifying tenant", for 1987 Act purposes, is defined in s.3 of the Act below.
1B. If F had been resident elsewhere in the block than in the sold flat, the Act would not apply- see s.1(4) below.
2. There are various time limits. If you mean 'action against F for not offering first refusal', see s.11A(3) below.

1(4). This Part also does not apply to any such premises at a time when the interest of the landlord in the premises is held by an exempt landlord or a resident landlord.

3. Qualifying tenants.
(1) Subject to the following provisions of this section, a person is for the purposes of this Part a qualifying tenant of a flat if he is the tenant of the flat under a tenancy other than:
(a) a protected shorthold tenancy as defined in section 52 of the Housing Act 1980;
(b) a tenancy to which Part II of the Landlord and Tenant Act 1954 (business tenancies) applies;
(c) a tenancy terminable on the cessation of his employment or
(d) an assured tenancy or assured agricultural occupancy within the meaning of Part I of the Housing Act 1988.

(2) A person is not to be regarded as being a qualifying tenant of any flat contained in any particular premises consisting of the whole or part of a building if by virtue of one or more tenancies none of which falls within paragraphs (a) to (d) of subsection (1), he is the tenant not only of the flat in question but also of at least two other flats contained in those premises.

(3) For the purposes of subsection (2) any tenant of a flat contained in the premises in question who is a body corporate shall be treated as the tenant of any other flat so contained and let to an associated company.

(4) A tenant of a flat whose landlord is a qualifying tenant of that flat is not to be regarded as being a qualifying tenant of that flat.

11A. Right to information as to terms of disposal, &c.
(1) The requisite majority of qualifying tenants of the constituent flats may serve a notice on the purchaser requiring him—
(a) to give particulars of the terms on which the original disposal was made (including the deposit and consideration required) and the date on which it was made, and
(b) where the disposal consisted of entering into a contract, to provide a copy of the contract.

(2) The notice must specify the name and address of the person to whom (on behalf of the tenants) the particulars are to be given, or the copy of the contract provided.

(3) Any notice under this section must be served before the end of the period of four months beginning with the date by which:
(a) notices under section 3A of the Landlord and Tenant Act 1985 (duty of new landlord to inform tenants of rights) relating to the original disposal, or
(b) where that section does not apply, documents of any other description:
(i) indicating that the original disposal has taken place, and
(ii) alerting the tenants to the existence of their rights under this Part and the time within which any such rights must be exercised,
have been served on the requisite majority of qualifying tenants of the constituent flats.

(4) A person served with a notice under this section shall comply with it within the period of one month beginning with the date on which it is served on him.

[Easy]

I think you are out of time now, but even if in time, you have the problem that the right of first refusal is exercisable by more than 50% of the flat owners.

As there are only two flats you cannot have more than 50%. Therefore even if the notices had been served etc you would not have been able to compel sale of the freehold because presumably the other flat owner (who was selling ) would not have joined with you in serving the counter-notice!

So what does "A long leaseholder such as yourself would in most cases be a qualifying tenant" mean exactly in this circumstance and how would it apply?

Note: This is a question i spotted in the paper, not one i asked! I thought the answer was as you mention.

[jeffrey]

So what does "A long leaseholder such as yourself would in most cases be a qualifying tenant" mean exactly in this circumstance and how would it apply?
This post crossed with my last one.