Leasehold Details Can Prove Costly for Retirees

16th September 2016 By Arman Khosravi

With an ageing population, purpose-built retirement properties are becoming more and more prevalent. It is important when considering the purchase of such a property to look very carefully at the detail of the contract (this is normally in the form of a long leasehold) and, in particular, to understand the implications of clauses which relate to future events as well as those with more immediate impact.

A recent case illustrates the point.

It involved residents of a retirement village in Hampshire who wished to sell properties they held under long leases. They were appalled to discover that under the terms of the leases they were required to pay to the landlord up to 15 per cent of the open market value of the property on a resale.

The owners of the leaseholds claimed in court that those provisions were unfair under the Consumer Credit Act 1974, arguing that the leases were consumer credit agreements because the resale fees were a form of deferred payment to the landlord.

That argument failed because the leases did not mandate a specific amount that would have to be paid: no debt was created under the original contract for sale, so there was no ‘credit agreement’ created.

However, the leaseholders are not giving up. They are now claiming that the surcharge on resale is an unfair contract term under the Unfair Terms in Consumer Contracts Regulations 1999.

Source: Concious

Latest News

Challenge to Will's Validity Rejected by High Court

12th April, 2024 By

The best way to ensure your assets will be distributed as you wish is to have your will professionally drafted by a qualified solicitor. In a recent case, a challenge to the validity of an elderly man's will was dismissed by the High Court. The man had previously made a will in 2011, leaving most of his estate equally to his three children. In 2018, by which time one of his sons had predeceased him, he made a further will, leaving the residue of his estate to his other son...

Defiance of Family Court Orders Will Always End Badly

10th April, 2024 By

Custodial sentences very rarely come into play in the family courts. Where there have been repeated breaches of court orders, however, judges may have little choice but to clamp down. This was illustrated in the High Court during committal proceedings that stemmed from a child custody dispute. The background to the case involved contested proceedings between the father and mother of a young child. These concluded with a court order establishing that the child – a daughter – would live with the mother. Three months later the daughter travelled with...

Claim for SDLT Relief on Annex Unsuccessful

8th April, 2024 By

When buying a property consisting of more than one residence, it may be possible to claim multiple dwellings relief (MDR) against Stamp Duty Land Tax (SDLT). However, there are certain conditions that must be met for an MDR claim to succeed, as a recent case illustrates. A property was purchased for £1.8 million. Prior to the purchase, the buyer had agreed with the seller that he would be allowed to carry out works to construct a self-contained annex at the property. The buyer's SDLT return included a claim for MDR...

Divorce – Alleged Bigamy Raised in Financial Remedies Dispute

5th April, 2024 By

The issue of bigamy and its potential impact on a person's ability to seek financial remedies in a divorce came under the legal spotlight recently. A husband made an application to strike out his wife's financial remedies claim on the basis that she had committed bigamy and deceived him into a marriage when she knew she was not free to marry. This deceit, he claimed, was so egregious that, as a matter of public policy, she should be debarred from pursuing any claim for financial remedies against him. The husband based...