Thirsk Winton LLP

Non-existent Freeholder – how does it happen and what can you do?

Whilst the concept of unregistered Freehold land is possibly well known, though becoming far less frequent, what people are often surprised to hear is that you can even have a Freehold piece of land that appears to have no owner at all! This situation arises where a Company owned the Freehold title but was then dissolved. In that situation the Freeholder no longer exists and so it would appear as if there is no-one from whom you can request either to extend your lease or to Enfranchise and purchase the Freehold.

Thankfully all is not lost, as in reality the assets of the Company become what is called “Bona Vacantia”. This means that they are held by the Treasury Solicitor, and it would be they who deal with the land in the first instance. Whilst they cannot be held bound to the obligations in your lease, so they are not liable to carry out maintenance or building works on the block of flats nor are they liable to obtain insurance for you, they are able to sell the Freehold to you. In that situation you would engage with the Treasury Solicitor, and contract with them to purchase the freehold interest, including paying the premium to them. They would execute all relevant paperwork and the purchase would be registered at Land Registry like any normal process.

However, this itself comes with conditions. Sometimes the Treasury Solicitor may not think that the land has any value or they are concerned that obligations of the landlord under the lease are onerous. In those situations they could “disclaim” the land, meaning that they are formally stating that they do not want to take up an interest in it and so effectively remove their ownership from it.

Should that happen then the land “escheats to the Crown”, and it would then be necessary to engage with the Crown Estate to purchase the land so as to be able to extend your lease or buy the Freehold.

This can be a lengthy and costly process, however it is unfortunately a necessary one if your Freeholder no longer exists and it is the only way of ensuring that your flat lease doesn’t simply come to an end when its terms expires.

A similar issue could arise where your lease has a 3rd party Management Company which no longer exists. In that situation there may be issues of who is liable to carry out the maintenance and upkeep of the building as it is possible that the lease does not require the Freeholder to do it in the absence of a Management Company. In those cases there are some limited options available to lessees and, whilst potentially costly too, it may be worthwhile exploring those so as to protect your flat and the block in general.

If you believe that your Freeholder or Management Company no longer exists and would like to discuss the various options available to you in extending your lease or purchasing the Freehold of your flat, then speak to a member of our Enfranchisement team today.