Click here to download a copy of the full article in Adobe PDF format

What is extending the lease?
Under current legislation, an individual leaseholder has the right to ¥extend his/her lease by giving up the current lease and buying a new one which adds 90 years to the time left on the old lease. Under the new lease, the leaseholder no longer has to pay ground rent (currently £150 for flats like ours, but soon to increase substantially). The price paid for the new lease is negotiated between the leaseholder and the landlord. If they cannot agree, as happened with us and Trinity House, the price will be settled by a leasehold valuation tribunal (LVT).

What we did
We have extended the lease on our flat by 90 years to December 2173. Our leasehold extension was a DIY job: I conducted the negotiations myself and presented the case at the LVT. This was the least stressful part of the process: the tribunal members were enormously helpful to me Ë a layman acting against a large firm Ë and allowed me to take liberties with the rules of evidence and in cross-examining Julian Briant of Cluttons.

The LVT decision was nearly 40% below the landlords final offer, so we were very pleased with the result. However, Cluttons then appealed to the Lands Tribunal and refused my request to use the ¥simplified process. There followed months during which I was ¥strongly advised by Cluttons and Forsters to settle the case and not to risk having to pay their large costs if I lost. I held firm.

A few days before the case came to court, Forsters made us an offer and we finally settled ¥amicably at a few hundred pounds more than the LVT had awarded. A final argument over costs seemed also destined for the LVT, but was settled, again in our favour, two days before the hearing.

It was a lot of work. It probably took eight man days over nearly 30 months but it was enormous fun, and winning at every level was enormously satisfying.

What did we save?
We saved about £7,000 on the price, compared with agreed settlements on the estate at the time. We also saved about £1,000 on the landlords costs, and probably over £1,500 on our expenses for a negotiated settlement. Our own expenses could have been over £10,000 if we had had professional representation at the LVT and Lands Tribunal. As it was, they were a bus fare.

Professional costs in lease extensions are out of all proportion to the sum in dispute and it is just not feasible for an individual to go to a full day tribunal with a paid solicitor and valuer, let alone fight an appeal. Cluttons are well aware of this and use the costs issue to pressure tenants to settle on much worse terms than the tribunal awards.

How we did it
I did get help.

The first step is the government-sponsored organisation LEASE. Their web site www.lease-advice.org is excellent at explaining the law and how the calculations are done. It also contains every LVT and Lands Tribunal decision so that you can research properties similar to your own.

I used the relevant pages in the text book Hague on Leases. It was a nice feeling to become an expert on a tiny bit of property law. However, when I first got the book and saw that the author gives especial thanks to Julian Briant for his assistance, I nearly gave up!

We were also helped in the early stages by Roland Jones (tel 020 7379 3475), a solicitor who has represented several people on the estate on leasehold issues.

I tried in vain to interest other tenants in joining a ¥class action or ¥test case which might have meant that we established a better precedent for future cases. In fact, although we ¥won on three occasions, our ¥amicable settlements, ie, outside of the tribunal, carry less weight than formal tribunal adjudications.

Should others do it?
Do I recommend that other long leaseholders extend their lease on a DIY basis? Most definitely yes. Remember, however, that the charity that owns the estate has a duty to maximise the returns to the beneficiaries of the charity, which is not the same thing at all as coming up with a fair deal for tenants. This means that their professional advisers employ ¥tactics. The law books, LEASE and the tribunal literature are not very helpful in advising about tactics. If there is a next time, I will be aware of these tactics and will respond accordingly and be less of a gentleman.

Max Lewis