Are there any conveyancers about please?

[Legallyperplexed]

I posted this in Legal earlier but it is very quiet. I'm hoping there's more "traffic" here.

Sorry - it's a long one!

I am trying to sell a retirement property as the owners have now died.

These properties are notoriously difficult to sell. We may, however, have found a buyer - a property investor who will in theory buy (at a significant undervalue). He is not a qualifying purchaser as he is below the age of 55 and I am presently seeking approval via the Trustees of the development as to whether this sale could continue as we would have then finalised the estate and the status quo would be maintained insofar as the development was concerned - there are currently about 18 apartments for sale!

That is one issue - if the Trustees do not agree to this sale then the whole thing will collapse. I accept that, and I am prepared to lose the solicitors' fees incurred thus far, with the agreement of the beneficiaries.

I do have another issue though.

The buyer is saying that they are yet to receive the management pack. My solicitor is saying that the Landlord’s solicitors will not release the management pack until I pay a £1,100 fee to assign the lease to the prospective purchaser. I declined to make this payment as, as I said earlier, if approval is not given, the sale fails.

I have told my solicitor this.

I have a copy of the original lease which states that “the Tenant (in this instance the estate) may assign this Lease to an Approved Assignee PROVIDED THAT the assignor Tenant must immediately upon the completion of the assignment pay to the Landlord: …..legal professional and internal administrative charges……reasonably incurred in dealing with the Assignment Notice……

There is another clause which states that the Tenant shall, (if requested by the Landlord) procure a solicitors’ undertaking to cover a reasonable estimate of the Administration costs.

My question is: Is it not the case that the completion of the Assignment is effectively completion of the sale for these purposes and that the undertaking that I would be happy to give should suffice? And, therefore, I should not be paying this amount at this stage?

I do not object to paying a reasonable amount for the management pack on behalf of the buyer, but to pay assignment fees seems somewhat pre-emptive. Even if assignee approval is granted then the sale could still fail if there should be something in the management pack which is unsatisfactory from my buyer’s point of view?

Indeed, would I be negligent in my handling of the estate if I agreed to those charges and paid them at this stage given there is no guarantee assignee approval will be granted?

Any advice would be appreciated, thank you!

[ChampagneCommunist]

When you sell a leasehold property (retirement or not) the buyer will always want the managing agents/freeholders info pack, often called the LPE1.

They can charge whatever they want for it and a buyer won't proceed without it.

Have the trustees given a timeline for the decision on the buyer?

[Legallyperplexed]

Thank you @ChampagneCommunist.
No, they haven't given a timeline re approval. I am getting little or no communication from anyone actually. I shall have to chase that. Again.

Also, I appreciate that the landlords can charge what they want for the management pack - but should they be talking about this £1,100 to assign the lease at this stage before Approval has been given and before the buyer and his solicitor has seen the content of the Management Pack and raised any queries on it? I'd have thought that the lease would be assigned upon completion?

[ChampagneCommunist]

It sounds like the assignment fee is part of that £1,100, which will be the info pack too.

I would chance for consent before paying. Or, agree to pay a portion, to enable them to get the info to give consent

[Legallyperplexed]

Thank you again.

I've just read the Landlord's terms and conditions. They say the Management Pack is £200, then £750 plus VAT to assign the lease.

I'm going to chase the approval then ask if I can pay the £200 for the pack to be sent out IF I get the approval!