Campaigner’s Legal Action vs Conveyancing Firm in Leasehold Scandal
15th February 2019
A leasehold scandal campaigner devastated to learn that she had been duped into signing up to ‘crippling and scandalous’ ground rents and permission fees on her new build property has today confirmed that she is to take legal action against the conveyancing firm which advised her on the purchase.
The co-founder of lobbying and support group the NLC (National Leasehold Campaign), Jo Darbyshire has instructed Professional Negligence Solicitors at Simpson Millar to investigate why more wasn’t done to protect her from a ‘disgraceful and opportunistic’ onerous ground rent clause rendering her home unmortgageable and unsellable.
Buying what she thought would be her family’s ‘forever home’ for £399,950 in 2010, Jo followed the recommendation of house builder Taylor Wimpey when it came to choosing a Conveyancing Solicitor to carry out the necessary searches and advise her accordingly.
She says the full implications of the ‘innocent looking agreement’ were never explained to her by her Solicitor, and it was only when a neighbour’s property sale fell through that the issues came to light.
Jo is now being represented by Professional Negligence Solicitor, Robert Godfrey, who is a Partner at Simpson Millar and Head of the firm’s professional negligence team. Robert said, “As part of the leasehold terms on Jo’s property there were a number of very complex and somewhat sinister terms.
“Her ground rent was scheduled to double every 10 years, she needed to seek permission to carry out any kind of alternations on the property which comes with an associated fee, and, perhaps most worryingly, the freehold could be sold on to a third party at any time.
“Indeed, that’s exactly what happened to Jo, and having been told initially by the sales advisor that she could buy her freehold at any time for a fixed cost of around £5,000 - it has transpired that the cost to buy her freehold is in fact now around £30,000
“Needless to say, that is going to make a future sale incredibly difficult to secure, as her neighbours have discovered. Many mortgage lenders are tightening lending criteria and will not lend on properties where the ground rent doubles more frequently than every 20 years.
“A property lease is a very complex document which needs to be carefully and simply explained to clients so they can understand the issues which may arise and make an informed decision in continuing with the purchase.”
According to the Leasehold Knowledge Partnership, as many as 100,000 homes have onerous lease terms.
Jo Darbyshire, who has been campaigning for the abolition of leaseholds across the UK to prevent others suffering as she has, says the ‘wholly unethical’ clauses and onward sale of the freehold have left her feeling uncertain of her future financial security, leaving her with no other choice but to take legal action against the Conveyancing Solicitor who advised her.
Jo, who lives in Lostock near Bolton said, “The leasehold scandal is having huge financial and emotional impacts on hard-working families.
“Ultimately, I feel that I was mis-sold my home, and that the Conveyancing Solicitor that Taylor Wimpey recommended I should use, failed to ensure that I was aware of vital information that would have been material to my decision making with regards the purchase.”
Robert from Simpson Millar - which has a dedicated legal team to manage the number of leasehold enquiries they are receiving daily - says awareness of the issue, brought about by a government consultation which took place last year, has prompted hundreds of people to get legal advice.
He said, “We have been receiving calls from people who have bought properties only to subsequently discover they have a leasehold property with onerous ground rent clauses which start off at a high annual amount and are forecast to double every 10 years, and the number of enquiries is growing by the day.
“This issue, as is the case with Jo, can clearly impact on the value of the property and the ability to sell it on. Indeed, in some cases, our clients have only become aware of the issue when they, or a neighbour, have tried to sell their property and the sales have fallen through.
“Buying a house is the biggest single investment most people make. To find out it may be a financial trap is distressing. People should not be placed in this position.
“Those now looking to pursue legal action have instructed us to consider whether there is a claim for professional negligence against the Conveyancing Solicitors.
“With Brexit immanent, the property market is uncertain enough, and this issue is putting many of our clients who are hoping to move up or along the housing ladder, at a significant disadvantage.
“Our investigations are in the early stages, but it’s already apparent that more could, and should, have been done to educate people on the longer term ramifications, and to take action to knock such ludicrous clauses on the head in the first place!
“To that end, it is right that the Government also look at whether house builders - many of whom have benefitted hugely from government schemes in recent years - have taken advantage of the public.”
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Simpson Millar Solicitors are a national law firm with over 500 staff and offices in Billingham, Bristol, Cardiff, Catterick, Lancaster, Leeds, Liverpool, London and Manchester.