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If you own a leasehold flat or house and you have an absentee or unresponsive freeholder, it can be very problematic. Common issues which can arise are:
- The landlord’s ongoing obligations under the lease not being fulfilled including insuring the property and maintenance, causing practical problems. In this situation, the leaseholders will often attempt to manage the building on an ad hoc basis, but that is not ideal, because they do not have the legal right to demand payment of service charges from their neighbours. Nor can the leaseholders be compelled to carry out essential work either to the fabric of the building or their own flat. It can also be difficult to insure the whole building when you only have a legal interest in part of it (your flat). This problem may be less acute where there is a management company party to the lease, or Right to Manage (RTM) has been exercised.
- There is nobody to contact if you want to extend your lease, buy the freehold or claim the right to manage.
- You may have difficulty in selling or remortgaging your property.
There are a number of reasons that a landlord may be considered ‘missing’ or ‘absent’. The law – and therefore the potential solution – differs depending on whether the landlord is/was a company or an individual person.
“The insights that you provided have been very helpful and confidence boosting.” MG, Client
Your landlord is/was an individual
If your landlord is no longer at the last known address they provided, it does not necessarily mean they are ‘missing’. Depending on the circumstances you may still be able to serve documents at this address. This is known as ‘deemed’ served. However, whether this will be effective depends very much on the particular circumstances of the case.
You will need to demonstrate to the court that you have carried out a reasonable search. Typical investigations include, but are not limited to searching the electoral roll, placing advertisements, and possibly even instructing an inquiry agent.
If your landlord has died and they did not own the property jointly with another person(s), their personal representatives will be able to deal with the property as soon as they have probate (if there was a Will) or letters of administration (if there was no Will). A search of the probate register should reveal the names and contact details of the personal representatives. If they died without leaving a Will and had no known relatives, the Bona Vacantia Department may deal with the estate.
If your landlord is declared bankrupt, it may be possible to serve notices on the trustee in bankruptcy.
Your landlord is a company
It is relatively straightforward to check whether the company still exists, or has been dissolved, by carrying out a search on the Companies House website. If the company still exists, it is often (but not always) possible to serve documents at the company’s registered office, which will have legal effect even if you receive no response.
When a company is dissolved, legally it ceases to exist. The term ‘bona vacantia’ (Latin for ‘ownerless goods’) is used with reference to any assets held by the company at the time of its dissolution, which by definition have become ‘ownerless’. Whatever the nature of these assets, they pass automatically to the Crown. They are dealt with on the Crown’s behalf by the Bona Vacantia Division (BVD) of the Government Legal Department. For further information see Bona Vacantia Property.
Buying freehold from absent landlord
If you are considering extending your lease or buying the freehold and your landlord is genuinely missing, the law allows you to apply to the court for a ‘Vesting Order’, whereby the court can make an order extending the lease or transferring the freehold.
There are strict procedures to follow and the matter will be listed for a hearing. We therefore recommend that you contact us for advice before proceeding.
Absent landlord indemnity policy
Absent landlord insurance is usually available for a modest premium. It is designed for the situation where the landlord of a single private dwelling is missing, unresponsive or insolvent, meaning that you are unable to obtain ground rent receipts at the date of purchase of the property. The policy will indemnify you should the landlord or their successor subsequently reappear and make a claim against you.