My client, having accepted the landlord’s offer to settle the premium to extend the lease on his flat and basement garage space together with quoted statutory costs in open correspondence, was astonished when the landlords valuer came back 10 days later saying the premium can only proceed at a higher price because one of his 3 landlord clients hadn’t appreciated that the offer to settle included the basement garage space – this space not being formally identified on the s42 notice claiming the extended lease.
In the end – the attempt to secure an additional premium came to nought because:
- All prior negotiations referred to the garage space with reference only to comparable sales of flats in similar blocks in the nearby area inclusive of garage spaces.
- S7(6) of the Act states:
Where in the case of a flat there are at any time two or more separate leases, with the same landlord and the same tenant, and – (a) the property comprised in one of those leases consists of either the flat or a part of it (in either case with or without any appurtenant property) and (b) the property comprised in every other lease consists of either a part of the flat (with or without any appurtenant property) or appurtenant property only, then in relation to the property comprised in such of those leases as are long leases, the Chapter shall apply as it would if at that time – (i) there were a single lease of that property, and (ii) that lease were a long lease.”
& where Hague clarifies:
‘The appurtenant property must be demised by the lease of a flat held by a qualifying tenant. If it is let under a separate lease, prima facie, it will not be included. However there is a special provision [s7(6) above] whereby if there are separate long leases of the flat and appurtenant property with the same landlord and tenant there is deemed to be a single long lease.’
- The leases in question were both demised from the same landlord to the same tenant and where the garage lease was clearly marked supplemental to the flat lease.
- The acceptance offer was made openly despite the final open confirmation email being removed from the email trail in response to his confirmation that they would accept the [agreed] premium.
After taking further legal advice – the landlord accepted that to claim additional premium simply because of the failure to identify the garage as an appurtenant property initially in the notice would in effect come to nought. The previously openly accepted premium was reconfirmed and peace was restored.