Lease on a small piece of land

[MyNameIsUrl]

An elderly relative has a 90-year lease (from 1997) on a small piece of land next to her house where she parks her car. The owner of the land, and the much larger adjacent field, was a small limited company.

She has three things worrying her:

- The limited company was dissolved last year (according to Companies House). There has been no communication and she doesn't want to rock the boat. Is that sensible or should she be more proactive?

- Annual rent cheques for £10 have been sent but not cashed for the last 8 years. Is there a risk she might lose her rights to the land?

- She is concerned about having to move (into a care home) and sell the house. The availability of parking obviously adds to the value of the house. Would new owners have the lease transferred to them automatically or would the lease simply cease even with over 60 years to run?

[Charlottesquare]

An elderly relative has a 90-year lease (from 1997) on a small piece of land next to her house where she parks her car. The owner of the land, and the much larger adjacent field, was a small limited company.

She has three things worrying her:

- The limited company was dissolved last year (according to Companies House). There has been no communication and she doesn't want to rock the boat. Is that sensible or should she be more proactive?

- Annual rent cheques for £10 have been sent but not cashed for the last 8 years. Is there a risk she might lose her rights to the land?

- She is concerned about having to move (into a care home) and sell the house. The availability of parking obviously adds to the value of the house. Would new owners have the lease transferred to them automatically or would the lease simply cease even with over 60 years to run?

Can she/you check Land Register to see if company land interest has been transferred?

If it was not conveyed prior to company dissolution then it passed to the Crown , Bona Vacantia.

https://www.gov.uk/claiming-money-or-pr ... ed-company

it may be possible to purchase the land from the Treasury Solicitor but whether that would be too much like poking the bear for her/you I do not know.

https://www.gov.uk/claiming-money-or-pr ... any-assets

Notwithstanding the company ceasing existence her lease, in my non solicitor opinion, still endures.

[stevensfo]

An elderly relative has a 90-year lease (from 1997) on a small piece of land next to her house where she parks her car. The owner of the land, and the much larger adjacent field, was a small limited company.

She has three things worrying her:

- The limited company was dissolved last year (according to Companies House). There has been no communication and she doesn't want to rock the boat. Is that sensible or should she be more proactive?

- Annual rent cheques for £10 have been sent but not cashed for the last 8 years. Is there a risk she might lose her rights to the land?

- She is concerned about having to move (into a care home) and sell the house. The availability of parking obviously adds to the value of the house. Would new owners have the lease transferred to them automatically or would the lease simply cease even with over 60 years to run?

Can she/you check Land Register to see if company land interest has been transferred?

If it was not conveyed prior to company dissolution then it passed to the Crown , Bona Vacantia.

https://www.gov.uk/claiming-money-or-pr ... ed-company

it may be possible to purchase the land from the Treasury Solicitor but whether that would be too much like poking the bear for her/you I do not know.

https://www.gov.uk/claiming-money-or-pr ... any-assets

Notwithstanding the company ceasing existence her lease, in my non solicitor opinion, still endures.

If she has a 90-year lease and has been sending cheques for the amount required, then common sense says that it is 'their' problem.

Maybe she sent them registered post - or whatever it's called these days.

If she signed a lease, then the onus is on them to respond and explain about the lease and cheques. Unless claiming bankruptcy, I don't see how a Ltd company being dissolved makes any difference.

Though others will be able to give better advice.


Steve

[mc2fool]

If she has a 90-year lease and has been sending cheques for the amount required, then common sense says that it is 'their' problem.

Maybe she sent them registered post - or whatever it's called these days.

If she signed a lease, then the onus is on them to respond and explain about the lease and cheques. Unless claiming bankruptcy, I don't see how a Ltd company being dissolved makes any difference.

As Charlottesquare says, Bona Vacantia. If the company has disappeared then fair chance there's nobody there for it to be "their" problem, let alone to respond and explain, and the property might well have reverted to the Crown.

‘Bona Vacantia’ means vacant goods and is the name given to ownerless property, which by law passes to the Crown.

The Treasury Solicitor acts for the Crown to administer the estates of people who die intestate (without a Will) and without known kin (entitled blood relatives) and collect the assets of dissolved companies and other various ownerless goods in England and Wales.

https://www.gov.uk/government/organisations/bona-vacantia

I agree that the Land Registry should be the first port of call.

[didds]

An elderly relative has a 90-year lease (from 1997) on a small piece of land

given that > 20 years has passed in that time of uninterrupted use of said land, does that in itself convey any "right" - even if ones to the general public?

(purely speculation based on something to do with rights of way etc).

I suspect the answer is of course "no" :-0

[Lootman]

An elderly relative has a 90-year lease (from 1997) on a small piece of land

given that > 20 years has passed in that time of uninterrupted use of said land, does that in itself convey any "right" - even if ones to the general public?

(purely speculation based on something to do with rights of way etc).

I suspect the answer is of course "no" :-0

There is a concept under UK law of "adverse possession", whereby if you trespass on land for a sufficiently long period of time, and the owner of that land knows about it and yet does nothing about it, then a claim can be made by the trespasser for formal rights to that land. Squatters have attempted to employ that mechanism in some cases.

However this case is not trespass. There is a lease/contract in place for the use of the land. And payment under the terms of that lease have been offered, even if they have not been recently accepted.

[didds]

and that makes perfect sense.

WRT that " the owner of that land knows about it and yet does nothing about it" - if the owner doesnt - even couldnt - know about it does that make sucgh adverse possession null and void for purposes of claiming formal rights?

(This is a possible derail, so admins feel free to create a secondary separate thread}

[Lootman]

and that makes perfect sense.

WRT that " the owner of that land knows about it and yet does nothing about it" - if the owner doesnt - even couldnt - know about it does that make sucgh adverse possession null and void for purposes of claiming formal rights?

(This is a possible derail, so admins feel free to create a secondary separate thread}

It is my (amateur) recollection when looking into this that the use of the land must be "loud and notorious" (or some such phrase). What that means is that if you sneak around and use the land surreptitiously, such that the landowner might never notice the use, then a claim of adverse possession would fail.

The critical factor is that the owner knew about the use and elected to ignore it for a sustained period of time, leading to the inference that he didn't care enough to complain or take other actions to preserve his property rights.

It is fairly rare for property to change ownership in such a manner, but it has happened.

https://en.wikipedia.org/wiki/Adverse_possession

[MyNameIsUrl]

Can she/you check Land Register to see if company land interest has been transferred?
If it was not conveyed prior to company dissolution then it passed to the Crown , Bona Vacantia.

If she signed a lease, then the onus is on them to respond and explain about the lease and cheques. Unless claiming bankruptcy, I don't see how a Ltd company being dissolved makes any difference.

As Charlottesquare says, Bona Vacantia. If the company has disappeared then fair chance there's nobody there for it to be "their" problem, let alone to respond and explain, and the property might well have reverted to the Crown.
I agree that the Land Registry should be the first port of call.

I’ve now checked the Land Registry and the entry still shows the name of the company which was dissolved just over a year ago. There are caveats that the information may change, that there may be an application currently being dealt with, and so on. Presumably it will take some action by someone to change this entry if it has reverted to the Crown? Should I initiate this action or avoid rocking the boat unnecessarily?

Meanwhile, presumably it would seem sensible to continue sending the annual cheques as before, as she has had no communication asking her to do otherwise?

As to whether the lease could be passed on with the main property (ie the house), the Land Registry Title Register under ‘Proprietorship Register’ shows ‘Title absolute’ and the name of the householder (not the company, which I find confusing) and the wording ‘There are excepted from the effect of registration all estates, rights, interests, powers and remedies arising upon, or by reason of, any dealing made in breach of the prohibition or restriction against dealings therewith inter vivos contained in the Lease.’ I don’t understand this sentence except ‘inter vivos’ makes me suspect things will change on death. However, if the company no longer exists, how could the land revert to it if the lease were to expire on the death of the occupier?

[didds]

Meanwhile, presumably it would seem sensible to continue sending the annual cheques as before, as she has had no communication asking her to do otherwise?

A thought just occurred to me...

1) cheques are invalid after 6 months of the date ISTR? So if nobody cashes them year on year the previously sent ones in effect mean nothing even if somebody at the company did suddenly discover them and attempt top pay them in.
2) how can she prove she sent the cheques if they've never been cashed? She can show a cheque stub of course - but that deosnt eman the cheque was ever actually written and sent, just that theer is a missing cheque and a stub saying it was sent to Company X for £Y. As they werent cashed they arent even in some archaic banking system gathering dust on a shelf (or whatever happens to cashed cheques!).

This isn't intended to dispute her actions, just it seems that even by following instructions, she may have absolutely no way to prove she ever did try and pay.


didds

[Clitheroekid]

Because the landlord company has been dissolved all and any property that it may have owned - including the freehold to the land - is bona vacantia, and is now vested in the Crown (assuming the land isn't in the Duchies of Cornwall or Lancaster).

However, the Crown will quite often `disclaim' title to freehold land in a situation where the freehold has little value, or is subject to onerous obligations - for example repair obligations in a lease.

In this case there must be a significant risk that the Crown will disclaim title, as the lease continues to exist notwithstanding the dissolution, but as it still has 64 years left to run at what is presumably a fixed nominal rent the value of the reversion may well be minimal.

If the land does, for some reason, have a substantial value, and it has simply been overlooked by the owners of the company (it happens remarkably often) then they can apply to the court to have the company restored, and everything goes back to how it was.

However, if the Crown does disclaim then a process takes place with the marvellously medieval term - the land "escheats to demesne". For all practical purposes the land is then ownerless. However, it can still be dealt with by the Crown Estate, which is not the same as the Crown - it's complicated!

My own view is that it would probably be sensible to approach the Treasury Solicitor, who deals with bona vacantia property, and see whether they would be willing to sell the freehold to your relative. Obviously, the likelihood of reaching agreement and the terms of any proposed sale would to some extent depend on the terms of the lease. However, if your relative could obtain the freehold then it would remove any doubt about parking rights, and would almost certainly enhance the value of the house (something the Treasury Solicitor will also, unfortunately, realise!)

[NomoneyNohoney]

If they won't sell the freehold, then is it fair to assume the remaining lease will continue until 2087 at £10.00 pa?

[didds]

If they won't sell the freehold, then is it fair to assume the remaining lease will continue until 2087 at £10.00 pa?

and - who gets sent the cheque? payable to whom? etc.

[pochisoldi]

Personally, I would do the following:

* Not send any payments until either (a) the company is restored to the register, and the company makes a demand for payment, or (b) the ownership of the freehold has been transferred, and the new owner makes a demand for payment (at which point I would confirm that the Land Registry entry has been updated).

* See what would be involved in buying or "obtaining" the freehold reversion. (Obtaining - meaning having Bona Vacantia disclaim)

As far as "buying the freehold" is concerned, I would take a look at https://www.gov.uk/guidance/apply-to-bu ... rsion-bvc4
It seems to deal more with leasehold flats and houses, probably because that covers 99% of all cases, but I don't see why it can't apply in this case.

It would appear to me that if Bona Vacantia may either sell the freehold reversion, or may disclaim interest.

You may need to consider whether the freehold title and leasehold title cover the same area (if yes - should be easier), or whether the leasehold title covers only part of the freehold (which might be more problematic, as you only want the freehold title for the plot which is currently leased, and Bona Vacantia may only want to deal with the whole freehold plot)

PochiSoldi

[DrFfybes]

For a company to own a field and rent a bit out, it sounds like a property holding company buying bits up to sell to builders if the area ever gets developable, perhaps they have 'restrucutred' due to debt concerns. Did the LR show a mortgage on the plot?

I would look at Companies House and see who the directors of the ownership company were, and whether they are directors of any other company. If it is a small company the assets may have been sold on (for a nominal sum) to another company controlled by the same people.

Another line of enquiry is who uses the rest of the field? It may be they rent that out too, or the renter has bought it and doesn't realise they also own 'your' bit or is unaware of the lease.

And contact the Treasury Solicitor. There is also a list of Unclaimed Estates https://www.gov.uk/government/statistic ... tates-list but I think it only applies to provate Estates on Death.

Any thought of Adverse Possession or 'claiming' the land require 12 years of continuous use for unregistered land, 10 years if registered, so she has to wait a while yet.

As for transferring the Lease - what does it say?

Paul