Harringay, Haringey - So Good they Spelt it Twice!
Legal advice re: excessive freeholder insurance charges
Hi.
I've written on here before about my problems trying to fight my freeholder's agents in their attempts to charge me and my fellow leaseholder neighbours outrageous buildings insurance premiums.
I'm now at the point where I need to pay for specialist legal advice - or concede and pay (for another year!) a charge that I believe to be about 250% over the odds.
So... can anyone recommend a legal expert in this field to speak to for a couple of hours. I'd like to be able to assess the law and governance around these types of situations, and to understand my rights and my options.
Any recommendations gratefully received.
Thanks,
Rich
NB. I've previously posed as the freeholder - using the existing policy detail as reference - to source alternative quotes. These quotes came in at approximately 40% of the existing policy premium. When I quizzed my freeholder's agent and insurance broker about this, they replied with suggestions the comparable quotes weren't suitable for minuscule/ridiculous/incomprehensible reasons, and cited all kinds of legal texts and subclauses in my lease (many of which were referenced incorrectly and therefore impossible to follow) in 'backing up their argument'. I believe this was all intended to baffle me into submission, rather than based on logic or legal facts. It just about worked!
I'm no legal expert and can't spare the time required to read up enough to be able to challenge them. The b*ggers!
Tags for Forum Posts: buildings insurance, first tier tribunal, freeholder, insurance, leaseholder, legal advice, managing agent
Replies to This Discussion
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Permalink Reply by Rich H on
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Thanks Antionette.
I've got half an hour's free advice tomorrow so I'll use that as a gauge as to whether I should pay to take it further.
In terms of the First Tier Tribunal (which I understand would be the step to take), this involves me shelling out a couple of hundred quid, and potentially incurring legal expenses etc. if I lose. I'll speak to the solicitor about this because I'm not willing to take a risk that could blow up in my face financially and sour relations even further.
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Permalink Reply by John D on
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I seem to remember, from when we flat owners were considering buying the freehold, that some managing agents get a kickback from the insurance company that they place their business with so they have no incentive to seek the cheapest company.
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Permalink Reply by sharon on
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Perhaps you need to check whether the freeholders are legally obliged to accept a lower (comparable) quote and go from there
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Hi Sharon.
I'm sure they are legally obliged - but it's what can be considered 'comparable'. They're responding in a language that I don't speak about the intricacies of the policies - particularly relevant to terrorism cover - and suggesting the policies I've found aren't suitable.
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They are not legally obliged to go with the lowest quote. The only test is whether the charges are reasonable. You would have to prove that it is unreasonable not to accept the lowest quote. You can challenge these costs via the Tribunal on your own and don't need the support or cooperation of your fellow leaseholders. Although obviously they would benefit from the determination if the Tribunal finds in your favour.
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Sorry Antionette and Sharon - you're right Antoinette. They have to prove they are supplying a reasonably priced policy. There's no doubt the existing premium is unreasonable if it's directly comparable to the alternative ones I've found. But the agent doesn't see those as directly comparable.
I'm no legal expert to be able to unpick the differences and determine whether they're legitimate. Hence seeking some legal advice.
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Hi Rich
Through my new found experiences with freeholds I would suggest two things;
1) Buying the freehold through collective enfranchisement. If you can get all the flats, if there are any in you building, to agree, the freeholder can be forced to sell you the freehold. Bit of a nuclear option, and expensive ( depending on the years left on the lease).
2) Apply with the other leaseholders, again if there are any, for the 'right to manage' the building. The Commonhold and Leasehold Reform Act 2002. gives leaseholders the statutory right to take over the management of their property from the landlord.
Personally from the information I can see, I would go with getting the right to manage first. Due to the fact that it will be an inexpensive option and resolve the immediate issues with your freeholder. Also if there are other flats in your building you will need to have them on board, if they are in the same situation as you then they should be as motivated as you. And buying a freehold will be a hard swing due to the cost.
You have options to take control, and you have a right to by law. So exercise them.
Ben
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Cheers for the response Ben.
I agree with your suggestions, but unfortunately they're not really suitable in our situation...
1) We, as leaseholders, don't get on brilliantly! There's a particular fracture between the other two, and they would never willingly join forces on anything. There's even less incentive for me to look to push the idea of buying the freehold as I have a very long lease on my flat. Also, none of us have much money in the bank from what I can gather...
2) Again, the relationships between the leaseholders would make this very stressful - if not impossible. I do agree with this in theory though...
Thanks again, Rich
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Ok that's unfortunate.
However surely the other flats can't be happy to be paying more than they should. In my opinion they should feel motivated to put there differences aside I order to save money and not be a the mercy of such a rogue landlord. You will also be able to use a building management company appointed by the leasholdleas, meaning no one in the building is solely responsible for the management of the whole building.
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I'm with you 100% Ben.
Unfortunately their relationship is irreparable - all happened before I turned up. And as I'm likely to the first of us to move on, they wouldn't agree to anything that left either of them in charge (or even associated) with the other.
Pain isn't it.
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Then maybe get your own insurance?
https://www.telegraph.co.uk/property/house-prices/expensive-insuran...
Mike Carter, head of conveyancing at Paul Crowley & Co, a solicitor, said: “The owner of a leasehold house is not required to use the landlord's choice of insurer, as long as they comply with the terms of the legislation.“This includes making sure that they insure the house with an authorised insurance company, choosing an insurance policy that protects the interests of the landlord and themselves, which covers at least the same risks as the policy offered by the landlord’s preferred company.
"Finally, the house owner should send a copy of the notice of cover to the landlord. If these terms are met, then the owner is well within their legal rights to choose their own policy."
I have recently bought share of freehold on an property with and absent freeholder, I used the services of Roulla georgeiou roullageorgiousolicitor@hotmail.com.
She’s very good.
Ben
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The owner of a leasehold HOUSE can arrange their own insurance, but the owner of a leasehold FLAT cannot. It will be dicrated by the terms of your lease and if the responsibility is laid out as being that of the freeholder, you cannot insure on their behalf.
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