So you want to buy the freehold to your building, but the landlord has gone missing – what can you do?
There are a number of possibilities. They may have died – in which case there may be executors who can deal on behalf of their estate. It may be there is an intestacy (where there is no will), but even so, there may be personal representatives who can act in this case.
INSOLVENCY ISSUES
The freeholder may be insolvent – in which case, there may be an administrator at the liquidator (if it is a company) you can deal with.
If the freeholder is a company and has been dissolved, then it may be that the government solicitor can help in selling the assets. Sometimes the assets will have moved to the Crown in which case a separate procedure needs to be followed.
Or, they may be just plain ‘missing’ – that is to say, whatever efforts have been made, it is impossible to trace them. This normally means that an inquiry agent cannot track them down based on some fairly thorough searching.
If this is the case and there is definitely no-one else who can speak on behalf of the missing landlord, then you should consider invoking the court process.
WHAT CAN I DO?
In the short term an absentee landlord indemnity policy will cover the risk that the absent freeholder may turn up and try to sue for breaches of lease.
However this will not solve the problem of lease length or, if there are unauthorised alterations, allow a retrospective consent to be given, which may be what a lender or purchaser will require.
COURT PROCESS
Put simply, you are seeking to convince a court that the freeholder is truly ‘missing.’ In order to get to this stage you will need to have placed some statutory adverts in the London Gazette, and perhaps locally, and also hired a private investigator.
Provided you have a detailed report showing the freeholder is missing, and can be shown to have taken reasonable steps to track them down, the court should allow you to file a claim that will take the place of the section 13 notice claiming the freehold.
Remember that for a missing landlord you need two-thirds of the flat owners to take part, if it is a collective enfranchisement.
EXPERT VALUATION
Provided the evidence is clear, the court will send the claim to the First-Tier Tribunal to determine the price payable.
You will need expert valuation evidence before this stage and your surveyor will need to submit a formal report to the tribunal.
Assuming that the tribunal (which stands in place of the missing person) approves the calculations, the tribunal will send the matter back to court. The sum approved will need to be paid into court, which will then seal the lease or transfer as appropriate.
The process is fairly simple in overview, but in a lot of cases the landlord is not ‘missing’ or other factors come up that cause delays. In terms of timing, you should allow at least a year to get through the process from start to finish.
Mark Chick is a property solicitor and partner at Bishop & Sewell LLP
