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Nov, 2014

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  1. #1

    Default Freehold Managers - Permission to Sublet

    Hello.

    I've read a number of posts on this subject, but none seem to apply specifically to my lease, so I am hoping someone can advise me on this.

    I have had a demand for £108 from Freehold Managers PLC for permission to sublet which from previous internet research seems to be possibly not applicable and even if applicable may be excessive.

    I asked them to specify where in my head lease they can charge and the clause they've pointed out gives them the right to change £40+VAT (which is more reasonable) or "such higher fee....shall reasonably deem requisite".

    The clause covers "any transfer assignment mortgage underlease" or "devolution of the Demised Premises".

    My questions are:

    1) Does the clause refer to or apply to subletting under an Assured Short Hold Tenancy Agreement (which I am using)

    2) Can I challenge the fee to be more "reasonable" and if so how?

    Thank you in advance for any advice.

  2. #2
    Join Date
    Jun 2010
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    Foundation trench for New Shed@ Ham on Rye
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    Default

    You need to post the whole clause, not an extract, for it to be understood.
    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers. More ramblings atleaseholdpropertymanager.blogspot.com

  3. #3

    Default

    Apologies - here is the complete clause:

    Within twenty one days next after any transfer assignment mortgage underlease or devolution of the Demised Premises or any part thereof to give notice in writing of such transfer assignee mortgage underlease or devolution and of the name and address of the transferee assignee mortgagee or other person or persons in whom any interest in the Demised Premises is thereby vested to the Lessor or its solicitors and to pay them a fee of Forty pounds plus Value Added Tax (or such higher fee as the Lessor or its Solicitors shall reasonably deem requisite) in respect of each such transfer assignment mortgage underlease or devolution.

    This also seems to suggest that even if the fee is payable, it's on a change of tenant basis not annual. For example, if the ASHT contract is 12 months and the tenant renews with the same details but a new 12 month term, then should a further fee be payable?

    Thank you for any advice.

  4. #4
    Join Date
    Oct 2009
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    5,270

    Default

    You are correct, although Freehold Managers (being a close relative of Estates & Management) will ignore this. They will not listen to any argument you may care to make.

    Either pay up what they ask every year, or go to the LVT for a determination.

    By the way, you need to apply on the Service Charge application form, on this website:
    http://www.justice.gov.uk/global/for...erty/index.htm

    (It has been established that the admin charge legislation does not include notice fees. Thus you need to mention that you are applying for a determination of a management cost, which is included in the service charge legislation.)

    Good luck. You will be the first to try this. Please try not to balls it up like I did with the Admin Charge legislation:

    http://www.residential-property.judi...y/10001AMR.htm

  5. #5

    Default

    Thanks for the quick reply. I've also asked this question to the company to whom I pay service charges (who thankfully are much more helpful and professional).

    Their view is that charges apply because it states this is the case in the lease but a recent LVT decision said that £30 was a reasonable fee.

    My lease says the fee is £40+VAT which I don't really have that much of a problem with so have written back to Freehold Managers quoting the LVT ruling and reminding them that they are not permitted to make a profit on such fees.

    I've also asked for a full breakdown of the £108 charge and pointed out that by virtue of 19(1)(a) of the Landlord and Tenant Act 1927, the lessor is entitled only to require payment of a reasonable sum in respect of any legal or other expenses incurred with such licence or consent.

    If that doesn't do the trick I'll go direct to the LVT. It would be nice to get a good decision on this and then campaign to force them to reduce their fees overall and pay back the overcharges they've undoubtedly made for long periods by people who haven't challenged them.

  6. #6
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    Oct 2009
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    Default

    Quote Originally Posted by srm39 View Post
    Thanks for the quick reply. I've also asked this question to the company to whom I pay service charges (who thankfully are much more helpful and professional).

    Their view is that charges apply because it states this is the case in the lease but a recent LVT decision said that £30 was a reasonable fee.

    My lease says the fee is £40+VAT which I don't really have that much of a problem with so have written back to Freehold Managers quoting the LVT ruling and reminding them that they are not permitted to make a profit on such fees.

    I've also asked for a full breakdown of the £108 charge and pointed out that by virtue of 19(1)(a) of the Landlord and Tenant Act 1927, the lessor is entitled only to require payment of a reasonable sum in respect of any legal or other expenses incurred with such licence or consent.

    If that doesn't do the trick I'll go direct to the LVT. It would be nice to get a good decision on this and then campaign to force them to reduce their fees overall and pay back the overcharges they've undoubtedly made for long periods by people who haven't challenged them.
    SRM39, unless you have done a RTM, you realise the company you pay Service charges to is likely to be ultimately owned by the same person as Freehold Managers, don't you?

    It isn't Peveral OM perchance is it?

    They will doubtless write back and tell you that notice charges are not consent charges, and so are excluded from that legislation.

    As I said above: 'They will not listen to any argument you may care to make.'

  7. #7
    Join Date
    Jun 2010
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    Quote Originally Posted by JK0 View Post
    SRM39, unless you have done a RTM, you realise the company you pay Service charges to is likely to be ultimately owned by the same person as Freehold Managers, don't you?
    That's not quite correct. While some may, many freeholds have tri-partate leases where the management is undertaken by a resident owned company, albeit with an external agents help.

    We have several legacy instructions from developers where a cordial but firm relationship with a new external freeholder (naming no names), and though technically our client, know better and leave well alone. On those schemes residents know who and how to notify, whether and who to get consent from and fees are agreed.

    Works for everybody and for the former owners of certain companies that's how you "do" asset management for long term survival.....
    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers. More ramblings atleaseholdpropertymanager.blogspot.com

  8. #8

    Default

    JK0,

    Thanks for the reply. The company who collect the service charge is unrelated to Freehold Managers, who only collect the ground rent (no insurance etc. which is covered within the service charge). The service charge company are a local firm with whom I've been dealing happily for around 10 years and they have been supportive in how to handle Freehold Managers' unreasonable claims.

    I'm also a director of the management company which deals only with the block which contains my rented flat who in turn are owned by the service charge organisation. This helps with having an influence over their decisions and aids transparency and accountability.

    Unfortunately it doesn't help with Freehold Managers!


    I may not get anywhere with complaining to these parasites, but feel it's certainly worth pursuing further at the moment.

    The service charge company is unrelated to Peveral OM but I have no idea who ultimately owns Freehold Managers.

  9. #9
    Join Date
    Aug 2008
    Posts
    3,433

    Default

    Freehold Managers Plc is part of Consensus Business Group - look for company no. 349 in the sructure posted under LVT on www.cqra.org-

    http://www.cqra.org/index.php/lvt/11...e-march-2011#1) EURO INVESTMENTS OVERSEAS INC VIRGIN ISL.

    What is the name of your freeholder ? They must be a member of the same group ? You should demand to see an appointment letter signed by a director of the freehold company under company headed letter paper authorising FM Plc to demand payment of 108 pds + VAT.

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