Difficult neighbour threatening sale. Help!

[HeyPesto55]

Need some advice please. We have a difficult downstairs neighbour who has spent 2 months questioning why they need to provide a piece of easily obtainable information to finalise our sale. I am at my wits end now because this is the last piece of information needed.

It is confirmation of their buildings insurance policy. A 2 min phone call.

I have tried being really nice, getting solicitors to call to explain why it is needed, pleading, begging, getting annoyed... all to no avail. I just don't know what else to do.

Would it be really bad to get the freeholder involved? Maybe suggest we are worried they don't have insurance?

If its in the lease that you insure individually (which can be done, but not in an ad hoc way such as you seem to have) then the only people entitled to see the proof of insurance is the free holder and their solicitor , who should have up to date copies of the insurance held anyway.

Normally each leaseholder insures their contents. The freeholder insures the building. While it may be the solicitor asking for it, it will be because they also act for the lender and the lender will insist on it. Contact the freeholder, although if you already put the freeholder's details on the Leasehold Property Form, I would expect your solicitor to have contacted him directly. Have you had to pay for a Management/Leasehold Pack, because that's usually where the buildings insurance is found?

You can't insure their part of the building as you have no insurable interest. To do it any other way is insurance fraud.

It is unusual in England for leaseholders to insure their own portion of the buildings and this is normally the freeholders responsibility. I'd check your leasehold documentation to make sure it is actually your responsibility if you haven't done so already.

For background I was an insurance underwriter for a non standard home insurer and it was rare to see leaseholders insure the buildings. Happens, but rare. More common in Scotland as laws are different there (don't know where you are, obvs)

so you have your own buildings insurance for your own flat and you need to show proof of everyone's insurance?

surely the freeholder would have that?

just a side note, it's a terrible idea, the insurance should be for the whole building.

This is definitely the case, everyone. Unusual though it may be! Thank you for all the replies, you are helping me see why she thinks it's such an injustice and is being so tricky.

I might speak to the freeholder actually. We haven't provided copies of our insurance but might suggest it's an idea as it's holding the sale up and might be something he's interested in establishing anyway.

The whole situation is just really frustrating.

Slimthisline, assume this is normally covered by an indemnity (and was in my case).

but when you say covered by an indemnity, in practical terms, if a claim needs to be made for a leaky roof that damages flats on all floors, how would you make it?

tbh I wouldn't even buy in a block where the flats were all insured separately, I lived in a shared freehold before (house conversion) but the policy was bought as a block. Otherwise it's incredibly complicated. I don't blame the buyer for wanting to see a copy of the insurance for others and sorry but the neighbour refusing to give it would be a deal breaker for me.

Slimthistime, interesting point.

The lease has a series of variations to clarify responsibilities. In practice, I don't know how a claim would work but would hope my solicitor would think it through adequately for me. This may be naive but conveyancing law is not my forte.

They are in agreement now though that the combination of insurance evidence and variations to the lease mean the buyer is covered. It hasn't really been an issue in past sales, of which there's been a few but i understand these things can shift...

The issue for me is dealing with a neighbour who has been asked to provide one simple document and is refusing... seems a tad OTT to me to prove a point.

I could at this point mention that she has a long term health condition and over the past 5 years we have fixed communal areas free of charge, mowed her garden and put out her bins weekly. But that's beside the point.

Yes, I would be concerned she is refusing because she doesn't have insurance. You're absolutely right to be annoyed with her but sadly I don't know how you get round it other than getting help from the freeholder.

Neighbour may not have insurance.

I wouldn't buy a property that had this set up, it's a recipe for disaster.

Well actually, in this particular situation her not having insurance would be ok because we could pay, she could sort and jobs a good'un! Financial incentive appeals to most. Alas, I don't think this is the reality.

Pesto "In practice, I don't know how a claim would work but would hope my solicitor would think it through adequately for me"

just to say as well, in reality when you need to make a claim, you should be calling one place and making the claim and getting any repairs done.

the situation you are describing, sounds like to get any work done on insurance would involve checking more than one insurance policy and then working out whose insurance should be used to make a claim....all the while if the roof is leaking, for example, in reality, someone is going to have to get work done to prevent things getting worse and then pay and reclaim it after.

Of course some people do buy without querying this sort of thing, but it strikes me immediately as being pretty problematic. There may be an indemnity but that doesn't protect against the huge hassle if anyone has to make a claim.

I really hope this goes through for you. But in the event the buyer pulls out, I would look to the freeholder and see if the insurance arrangement can be altered because as York says, it's a recipe for disaster.

cross post
if she doesn't have insurance, and you pay for her to have the building insurance for a year, what then? The buyer pays for her in the next few years?

Thanks for your advice everyone, as I said this is the first time in a number of sales that it has come up and being no expert, I have to accept the advice I have been given. I'll chat to the freeholder.

Grand, as a PP said, this is a more regular occurrence in Scotland so I would advise you don't search for any property there

It's an education if nothing else. Really blinking annoying though.

Slim, apologies, I didn't see your post previously.

If this sale falls through, you are correct. I will definitely approach the freeholder for clarification. At least to set up the correct procedure to ensure that noone's insurance policies have lapsed as a minimum.

I don't think in reality I would pay someone's building insurance, I was just paying devil's advocate. If I really thought she had no insurance, I would ask the freeholder to check. I do believe she has it but doesn't see why she should provide evidence. She can be awkward in these matters but intelligent and very organized. And trustworthy so I don't think she's lying.

This thread has been very interesting. I am no moron by a long shot but it does make me question the amount of trust I'm placing on my solicitors' advice.

As you do so much for her, is it possible she's hindering your sale for that reason?

You can see why she's not giving the details though. You are selling your flat; her insurance on her flat should be irrelevant to your sale. I can see the Freeholder having a legitimate interest in there being up to date insurance policies, but no-one else. It is intrusive, and frankly, I would be questioning why a third party who was nothing to do with me or my financial affairs, needed to see it.

It's like my NDN wanting to see that I have insurance for my drive over which they have a right of way. MYOB would be my response.

Scary teacher you could look at it that way, but the mortgage company wouldn't. Since the property is their security, they want to be sure that the value won't be affected by any foreseeable event. If it burns down and isn't properly insured, they won't be happy.
Same goes for the drive, if that was something that would ruin the value of the house and would be likely to be destroyed at high cost, they'd be reasonable to confirm insurance.
Some houses or flats are un mortgageable. At least the ops doesn't fall into that category.
You can recognise an un mortgageable property because it's being auctioned, or advertised as cash buyer only.

The mortgage company wouldn't see it that way, no, but they have no rights to see neighbours documents either. Just one more reason why this set up is such a bad idea.

Scary, that's not a good comparison. Again, imagine dealing with a damp problem going through the whole building.

JohnD The mortgage company could look at it however they wanted....as I pay the mortgage on my drive, it is nothing to do with the mortgage company used by next door. Were I to be approached, the response would be negative.

Slim I would hope the freeloader would organise any damp repairs, and normally, you don't claim on your insurance for an on going damp problem.

I dunno - the neighbour holding separate buildings insurance sounds odd to me as others have stipulated. She would have her own contents insurance but that is no one's business. The only reason she might hold the buildings insurance is if you have a right to manage arangement and she is doing the administration. Otherwise the freeholder should take out the buildings insurance. In all cases, you need to a) pay for your portion of the insurance and b) be given a copy of the insurance policy each year. I would contact the freeholder first to see if they are responsible. I would rather suspect you have dropped the ball on this in past years.

Slim that had crossed our minds. She has frequently said she'd be sad to see us go.

Scary I understand your point, though it's not a totally apt comparison. As the owner of the above property, you could argue I (or my insurance company) have a right to see her documents, could you not? To ensure I have the right level of insurance to jointly cover the building.

One of the terms of the lease is to provide cover, so I don't feel it's a stretch to evidence cover to interested parties (my solicitors and me).

Vents thanks for the comments. We have separate arrangements and the freeholder is not responsible. See my previous posts.

Acknowledged this is unusual.