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What is bona vacantia?
Bona vacantia is Latin for ‘ownerless goods’.
On a company’s dissolution, by law, it ceases to exist. Bona vacantia refers to any assets held by the company at the time of its dissolution, which, by definition, are now ‘ownerless’. Whatever their nature, those assets pass automatically to the Crown. On the dissolution of a company owning the freehold or superior lease of your property, we can assist you.
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Bona Vacantia property for sale
The Bona Vacantia Division (BVD) of the Government Legal Department deal with bona vacantia on behalf of the Crown. However, the Crown will not assume any company liabilities or responsibilities. That includes stepping into their shoes as a landlord, which they consider too onerous. So, if the company owned the freehold of a block of flats, the Crown will either:
Bona vacantia freehold purchase
Often, the BVD will consider selling the freehold to leaseholders interested in acquiring it. The price for a freehold purchase depends on:
- the value of the flats;
- the length of the leases; and
- the level of ground rent.
Procedure for freehold purchase
Leaseholders apply for the freehold purchase to the Bona Vacantia office with jurisdiction for the area where the registered office and the assets of the dissolved company are situated.
On purchasing the freehold, leaseholders are liable for both their own legal fees and those of the Crown.
Bona vacantia disclaimer
If the BVD disclaims the freehold, that extinguishes the freehold title, and the property becomes part of the Crown Estate (a different entity from the BVD) in a process known as ‘escheat’. The Crown Estate does not assume any liabilities over land and, although not obliged to sell it, its usual policy is to dispose of it to a suitable buyer.
I need to extend my lease. Can the Crown extend it?
No, the BVD will not extend a lease when the freehold reversion has become bona vacantia.
Can a restored company recover their property?
On a company’s restoration, it can recover bona vacantia assets, provided the property has not been disclaimed by the Crown. However, there may be penalties to pay. An application can only be made by a former director or member of the dissolved company within 6 years of the company’s dissolution.
Bona vacantia waiver letter
If applying for the administrative restoration of a dissolved company, the law requires you to obtain the Crown representative’s written consent. This consent is known as a bona vacantia waiver letter. Full details are available on the government website.