In breach of lease but no Shareholders Certificate

[yaffsimone1]

I purchased my property in March 2006 which is leasehold. I informed the management company that i was the new owner and started to make my monthly payments for maintenance. About 3 months in to living at the property i started to have problems with the management company and their lack of maintenance. I started to complain by phone and letter about various issues and kindly informed them that they were not complying with the terms of the lease. I also complained about not receiving my shareholders certificate (the management company issues this certificate). The reply i recevied was quite shocking, they told me that there was not a case for non-compliance to the lease as no shareholders certificate had been issued in my name, it was still in the name of the previous owner and there cannot be two certificates pertaining for the same property and i didnt legally own the flat!, therefore they cannot be in breach. Basically i did not have a lease even though i had paid my yearly ground rent. Considering this i wrote to the company and informed them that i would no longer be paying anymore maintenance charges and suggested they contact the shareholder. I stopped making payments. I then started to recevie letters demanding the arrears on the account and i that was in breach of my lease, what lease i have not got one! no certificate!, again i asked them to either issue a certificate in my name and i will pay the money due otherwise contact the 'legal' shareholder. Nothing but the letters kept coming. I have now had a letter from thier solicitors demanding payment. But if i am not a shareholder there cannot be a breach of the lease where do i stand with this. I am quite happy to pay the money but not if i dont have rights to the lease.

[AnimalMagic]

A you talk of a share certificate, I am assuming you mean you are a leaseholder of a property which is jointly owned by all the leaseholders as opposed to a leaseholder of a property owned by someone else?

If so, then your company constitution (memorandum/articles of association) will define if you should receive a share certificate. It is normal for one to be issued and indeed you may have been charged a fee for this on purchase. You need to check your purchase documentation. The contract to purchase will define when you became party to the lease.

As for the liability for fees, this is a lease issue and therefore nothing to do with you being a shareholder. There is almost no defence for not paying the fees - again you need to check the leasehold agreement.

As for the management breach of contract, the lease is a contract between you and the freehold owner, presumably a company in which you own a share. Being a shareholder is irrelevant to the lease.

If you can prove the breach by management, I would simply respond pointing out their breach and stating that you will pay up, once they remedy their breach. They will either do so, or take you to court.

If they take you to court, then do not dispute the fees, but make a counterclaim for their breach. If you prove the breach you will be awarded compensation which will offset the fees, usually calculated on the rental value of the property or its market value. Ensure you know what these are, as the judge may ask... Ideally have something in writing, as the management may dispute the value.

I should qualify this advice by saying I am a leaseholder of a property in which I own a share. Our management took me to court recently for failure to pay my fees. Their claim was for 2600, my counterclaim was for 3477. I did not dispute the liability for the fees. I defended it myself against the management's solicitor and I won my counterclaim. The compensation awarded was 5000, limited by the small claims court (it would have been higher).

Hope this helps...