Historic rentcharges Bristol Bath Manchester

This forum is for Garden Law problems that don't fit into the other categories. Please treat it with respect.

Moderator: Angelisle

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Tue Jul 23, 2019 8:16 am

Is there anyone around who can help me with a few queries ?

Specifically ,if a Management Company owns the freehold ( house subdivided into 3 units all of which have leases ) can the MC redeem the rentcharge ?

There is no contact with the rentowner ,I'm not aware of efforts to trace the heirs of the person named in the title .

To redeem I'm guessing it's necessary to know who the current rentowners are ? Is that correct ?

Generally - do investment companies/others have to trace the current rentowner in order to buy the rentcharge interest ( or whatever it's called ) ?

- is it straightforward to get an indemnity insurance relating to rentcharges ?

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Tue Jul 23, 2019 9:34 am

I guess this isn't really related to gardens ! Apologies .

FilthWizzard
Posts: 37
Joined: Wed Aug 15, 2018 2:00 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by FilthWizzard » Tue Jul 23, 2019 10:59 am

Please, be EXTREMELY cautious with regards to rentcharge. It is a very complicated and evil system which is being used by companies to completely ruin peoples lives and to effectively take huge sums of money from freeholders or even put a 99 year lease on their properties.

Note that it does not matter a jot that you don't know who currently owns the rentcharge (often called Chief Rent in some areas including yours) and who to pay. If it is owed and not paid, the freeholder is in breach and could face significant penalty at any time.

Do you own the property or are you seeking to buy? If buying, get in touch with your solicitor about this ASAP. Note that many solicitors won't think this is a big issue due to the belief it could not be used that grew up some time ago. This is no longer a sensible legal belief as courts have demonstrated, and it is currently being used to make big problems for people. Make sure you get a solicitor who really knows about this stuff.

You need to know if this is a constructive rentcharge or not (a charge for maintaining something). Note that the thing need not have been maintained for you to owe the money. It is quite possible that the Management Company owns the rentcharge if it is a modern one and are using that archaic mechanism to get around the new ground rent rules. They can and likely will completely shaft you with this mechanism, as no decent company would use such so it is very telling if they have.

If it is an old one who knows who owns it, but it could be bought up at any time by a number of very shonky companies who would then be able to make you dance to their tune.

Please don't expect anything regarding rentcharge to operate in a fair or normal manner. This is very ancient law and does not operate as our modern views on fair play would suggest. This mechanism was all about the local bigwigs pushing around the little people back in history, and its design for that purpose is as effective now as it was back then.

Look up rentcharge on the internet and quake in legitimate fear. If you find out the rentcharge is not constructive (check your deeds carefully) then post here for further advice. You do not need to know the current owners of the rentcharge to redeem (though it helps a lot) but the rentcharge MUST NOT be constructive to allow for any redemption. If you are buying and this cannot be resolved before exchange, run far and run fast.

To answer your questions:

Specifically ,if a Management Company owns the freehold ( house subdivided into 3 units all of which have leases ) can the MC redeem the rentcharge ?
- Possibly, is it constructive or not?

There is no contact with the rentowner ,I'm not aware of efforts to trace the heirs of the person named in the title .

To redeem I'm guessing it's necessary to know who the current rentowners are ? Is that correct ?
- I'm not 100% sure, but it helps significantly. Best to get solicitor advice on this. There may be a way around it, but the system is designed around knowing who the rentowner is. I never found an explicit way to deal with this without knowing, but if the rentcharge is not constructive a solicitor may know a way forward. If it is constructive, without the rentowner agreeing you will find you are shafted.

Generally - do investment companies/others have to trace the current rentowner in order to buy the rentcharge interest ( or whatever it's called ) ?
- Yes, but there are some very nasty companies well practiced in doing this and they particularly operate in the areas of the country you mention.

- is it straightforward to get an indemnity insurance relating to rentcharges ?
- Nothing about rentcharge is straight forward. I would not buy anything with a rentcharge on it that has not been sorted out before exchange. I looked in to the insurance situation, and whilst it may be possible (MAY, depending on your situation and if anyone else knows the rentcharge exists, certainly don't tell anyone but your solicitor) personally I would not rely on it. You could still end up in a very tricky situation that you can't get out of. Any insurance would need to pay out significantly to extract you if it goes wrong.

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Tue Jul 23, 2019 12:46 pm

Hi ,thank you for your reply . I believe there was a thread ( yours? ) about a tithe rentcharge,even worse and even more complicated ?

I have googled a bit and read the horror story and the strange?terrifying power that rentcharge law has .

My query is in reference to a friends property that it is being sold . When friend bought not so long ago her slcr ( who was not in the part of the country that has these charges ) did not draw attention to it . I am anxious it might put a buyer off.

The rentcharge has not been introduced by the MC, it dates back to eighteenth century .

I have ordered a copy of the relevant deed and won't know what type ,if any ,covenants are referenced .

I really don't understand who can buy or redeem these rentcharges if the rent owner is unknown .Do unscrupulous individuals/firms locate descendants and find one who is vunerable who they can get to sell to them ?

FilthWizzard
Posts: 37
Joined: Wed Aug 15, 2018 2:00 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by FilthWizzard » Wed Jul 24, 2019 10:40 am

Yes, that was me. Tithe rentcharge no longer exists but due to a typo on my title document it was stated as a 'title' rentcharge which looked very much like a problem. All tithe rentcharge was extinguished in the 30s (1936 I think?) and one of the finance acts ended all liabilities from that in the 70s (77 I think?). If it is stated as a tithe rentcharge, you are lucky and can breath a sigh of relief.

Yes, often these things were not spotted as they were thought by the legal profession to be unenforceable at one time. Some may still think that is the case, but they would be very wrong. Courts do uphold this stuff unless or until someone on the political side does something about it (when they've finished taxing milkshakes...).

Rentcharge issues are very likely to put a buyer off if they have good legal advice. I had poor legal advice but I was on the ball enough to deal with it myself. It almost ended the sale but mine was luckily not valid. The only real chance if you can't get rid of it before selling is to palm it off on someone who doesn't have a scooby. Not nice, but there it is.

Whilst some areas have a lot of this rentcharge stuff (the ones in your post title), it does crop up all over the country. I guess there is a better chance that buyers will not be aware in areas that don't see this issue much (such as where I live as it happens).

It is good that it is nothing to do with the MC. That hopefully means no-one knows about it. This is important if any insurance is to be bought as these awful companies that acquire these rentscharge have to do a lot of detective work to find these things. Don't let people know about it, other than a solicitor, as insurers will ask you who is aware it exists.

If the owner can't be traced, it gets very difficult and may not be possible to redeem. Check with a solicitor who knows about this stuff, but it may not be possible if you can't trace the owner. That said, if no owner crops up to cause issue then that is a good thing to a degree. It is to be noted that once you get insurance, you cannot even look for the owner as that would invalidate the insurance.

If it is a constructive rentcharge (ie. to maintain a fence, paint a lamp-post or whatever) then it cannot be redeemed even if you find the owner. The owner may agree to sell it to you, but you'd be best advised not to even look for them because they may not even know they own it and once they find out they may cause big problems for you as you cannot redeem it as it is constructive. You are then in a nasty trap. You MUST find out if it is constructive before even starting to do anything about it. Getting those title docs is the first step. When you have the text referring to the rentcharge, post it here (removing all identifying content).

Yes, your view of these dodgy companies is about right. That is pretty much how they behave.

So, best outcome is it is tithe rentcharge. Next best is that it has been recorded as redeemed already. Next best is that it is not constructive and the owner is known/can be traced. Next best is that it is not constructive and the owner has been missing for a long time. Any situation where it is constructive and valid (so not tithe) is bad, and personally I would not buy anything in such a situation.

Best of luck, do post again when you have those documents.

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Fri Jul 26, 2019 9:13 am

Hi - yes documents in hand courtesy of the lovely Peter at the LR in Durham where they have no air conditioning .

The property in question is a friends . I am hoping that her buyer isn't googling and reading about rentcharges . And that the slcr being used is as unconcerned as the one who did the conveyance to said friend .

Nothing to do with tithes but yes the grant has positive covenants .And a very detailed description of the process that could be deployed if rentcharges are in arrears and how notice isn't required for it all to swing into action .And how endless costs can be added .

On and on it goes ,using 4 lines where one word would do . For clarity and the avoidance of doubt one imagines . I only have a hard copy and limited access to any technology that might help me reproduce here .

Later ,when cooler and I have the time I might try and capture with the web cam on my laptop and then fiddle around redacting . Or type out some of the relevant bits .

Do you have any idea about insurance for a rent charge of this nature ?

Thank you for your helpful and knowledgeable input .

FilthWizzard
Posts: 37
Joined: Wed Aug 15, 2018 2:00 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by FilthWizzard » Fri Jul 26, 2019 11:19 am

Firstly, the title documents may contain many positive covenants, but the only ones that matter re. the rentcharge are those specifically linked to that charge (so those that the rentcharge is supposed to pay for). In my case, it was only for maintenance of a fence but that would have been enough to be an issue if mine had not been tithe. Note that it matters not if the fence had not even existed in living memory, or if the historic position could not even be determined. It should also be realised that the worst results of rentcharge are that if not paid, the rent owner can place a lease on the property for 99 years which is hellish to get removed, effectively seizing the property, and has rights to gain access to the property. It is all very scary.

Often the mention of rentcharge in a title document is a short line or two. It is unfortunate that so much detail is in the title document as that increases the chances of a prospective purchaser or their legal representative taking note of the issue and getting the fear.

I was offered the option of the insurance route, but I did not need to take it for reasons explained. Your pal's solicitor should be able to source something like that. Your pal should be ready to pay for said insurance to give confidence to any seller. You may have issues getting that insurance if the rent owner is known or knows about the rentcharge they own as this significantly increases the chance that something will happen. If it is archaic and the owner is lost in the mists of time, you should be able to get insurance I think. The seller will also be expected to put some money by (so take from price of property) to cover 6 years of payment arrears for the rentcharge in case the rent owner shows up (assuming there is no proof of it having been paid for the last 6 years).

The only other possibility, this being constructive, is to find the rent owner and buy the rentcharge from them (arranged formally through the Land Registry, as it needs to be recorded). The risk is that if the rent owner is found and told about all this they may not be a nice person, or they may want to charge an unreasonable price. I would think a fair price would be the same price as would be calculated for a rentcharge that could be redeemed, but there is no obligation on the owner of a constructive rentcharge to be fair. They may choose to become a problem directly, but they may feel they can get more money by selling to one of the difficult companies that hoover up these things. So, much good judgement needs to be used. If it was owned by ie. the Church perhaps you could sort something out. Just be careful when investigating, and don't let on to the owner unless you are very sure. If they won't sell to your friend and are made aware of what they own, you will likely find insurance impossible to obtain and could make the property practically unsaleable.

I think you have reached the point where your friend would be best advised to get legal advice. You can paste the wording (carefully removing identifying features) from the title docs here and possibly there is some way out that people could spot like I had, but the way you have described things does not sound like great news for your friend.

The only other hope is that the politicians sort this out. There have been attempts made, last one being in the 90s (failed due to incompetence in drafting new law, seriously, it was a huge government clock-up). There has been talk of addressing this, but Parliament can move very slowly and unpredictably at the best of times. With Brexit going on, I would not expect swift attention.

Ignore any talk of the eventual end of rentcharge as 'they will all expire in a few years' or some such. There is a thing relevant to redeemable rentscharge (though it's not happening any time soon) but constructive stuff is set to last for eternity unless the law is changed.

I really feel for your friend. They need to get legal advice ASAP. Note that once they sign up for insurance for this, they will be banned from trying to find the owner at all as the insurers will be terrified of the owner resurfacing.

FilthWizzard
Posts: 37
Joined: Wed Aug 15, 2018 2:00 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by FilthWizzard » Fri Jul 26, 2019 11:48 am

ADDITIONAL:

Think about how such insurance will work, and take care that it will do what you want. For example, imagine it all suddenly gets real and a rent owner causes issue. So you manage to track them down and pay them off with insurance money and get the house back. Sorted, right? Well, not really. So the rentcharge would still exist and regular (usually very small) payments are required. So you just keep them up, right? Easier said than done. Remember, with such small payments rentcharge ownership is almost worthless without getting the poor freeholder into a bad situation so that is the only goal of a rent owner who won't sell. So, they move office and change bank account details, and they don't tell your friend about this. She can no longer pay, and gets in arrears. There is no obligation on the rent owner to tell the freeholder how to pay, where they are or anything. All the obligation is on the freeholder to pay, whatever. Or perhaps they sell it on to another company and they don't tell the freeholder.

At this point, when the insurance policy comes to an end it will likely be impossible to get more insurance for it as the rent owner is now aware and active. The property has become very hard to sell (and certainly devalued) and at any point the freeholder could find big problems tracing the person they need to pay. Next time it all goes off, and there will be a next time, what does the freeholder do?

Personally I would be very concerned about buying, even with insurance in place. I would at least expect a sizable discount on the property price and may well not bite even then. Perhaps it would be easier to sell to a landlord or something (at discount), someone who would not be looking at the property to be their home and so might be willing to take more of a risk.

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Fri Jul 26, 2019 1:34 pm

Thank you FW ,situation doesn't seem too hopeful .

This is a just a trial image ,will look for positive covenants examples .

RC1 on CS.jpg
You do not have the required permissions to view the files attached to this post.

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Fri Jul 26, 2019 2:32 pm

The document is very long and wordy and I'm anxious that I can't give it my proper attention right now .

It starts

This indenture is made day month 1865 btwn important person and lowly builder .

Witnesseth that in consideration of the yearly rentcharge of £x hereinafter reserved and of the covenants hereinafter contained on the part of the said LB his heirs executors administrators and assigns to be respectively paid and performed He the said IP Doth hereby grant unto the the said LB his heirs and assigns all that plot of land situate in the Parish etc 11 lines of description delineated in the said plan etc

another extract .I don't understand the sentence that I have put in bold .And it may be important ( I have no idea ) to note that the Land Reg notes that the deeds and documents of title have been stolen.

And the said IP doth hereby for himself his heirs executors administrators and assigns further covenant with the said LB his heirs and assigns that he the said IP his heirs or assigns will upon every reasonable requst in writing by the said LB his heirs or assigns or any person lawfully or equitably claiming any estate right title or interest in or to the said hereditaments hereinbefore expressed to be hereby granted or any part thereof at the cost of the person or persons requiring the same produce and shew to him them or any of them or to such person or persons as he or they shall require or at any trial hearing or examination in Court of Law or other Judicature or in the execution of any Commission or elsewhere as occasion shall require every or any of the Deeds specified in the schedule hereto for the mainifestation defence and support of the estate title and possession of the said LB his heirs or assigns and every or any such other person as aforesaid and will at all times at the cost of the said LB his heirs or assigns or any such other person as aforeside make and furnish to him or them such true copies attested or unattested of all or any of the same Deeds as he or they may require and will in the meantime keep the same Deeds safe whole uncancelled and undefaced ( unless prevented from so doing by fire or other inevitable accident )
PROVIDED ALWAYS and it is hereby agreed and declared that if the said IP his heirs etc shall deliver the said Deeds or any of them to any person or persons lawfully entitled to the custody thereof and shall thereupon at his or their own expense procure the person or persons to whom the same Deeds shall be so delivered to enter into a covenant with the person or persons then entitled to the benefit of the covenant hereinbefore contained to the same effect then and from thenceforth the covenant hereinbefore contained shall become void so far as relates to the Deeds the subject of such substituted covenant.And the said LB doth hereby for himself his heirs etc covenant with the said IP his heirs etc that he the said LB his heirs etc will henceforth pay the said yearly rent charge of £x in equal portions on ....


I don't know if you've waded through that ,complete understanding if not .Also complete understanding for need for proffesional input .

I have some other calls on my time now ,so if I don't reply I'm not being rude !

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Sat Jul 27, 2019 11:53 am

This extract from one of the court cases Morgoed Estates and Keegan gives a small insight into how Morgoed obtaint rentcharges and persue them.


By a conveyance dated 25 September 2003, Miss Moorse conveyed to the Third Applicant (Moergoed) 102 rentcharges including that in respect of the property. I note that by that time she was in a nursing home, and I also note that her previous address as given in the conveyance is not the same as that on the demand which she had sent to “The Occupier” of the property. It is possible that Miss Moorse used an old address on the demand with the result that the postal order and letter sent in return never reached her.


It would appear that a firm of solicitors, Veale Wasbrough, acted for her on this sale of rentcharges, which realised £3500. The average annual amount due in respect of each of the 99 rentcharges was in the region of £3-£4. Veale Wasbrough provided Morgoed with a form of authority on their headed notepaper for Morgoed, dated 9 October 2003, to send to each of the owners of the 102 properties informing them of the assignment of the benefit of the rentcharge in question.

FilthWizzard
Posts: 37
Joined: Wed Aug 15, 2018 2:00 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by FilthWizzard » Mon Jul 29, 2019 10:45 am

Firstly, good grief they've gone to town with that wording. Secondly, I'm not seeing the constructive element with my brief reading of what's here (that scan is not easy to read). What is this rentcharge being paid for? If there is no maintenance or such like positive element then this would not be a constructive rentcharge, which would be a good thing. If this rentcharge is not supposedly paid for any constructive purpose and is just money for the well-to-dos then it should be redeemable (upon tracing the rent owner).

It seems like there's a clause which renders the rentcharge invalid under certain conditions. Problem is, it is very difficult to understand that clause (as you've spotted) due to it being written in fairly elderly legalese. This needs taking to a solicitor who is experienced in handling rentcharge issues to get a sure understanding. There may be someone on here who can clarify a bit, but I would still seek a professional legal opinion on that as it may offer a way out without the need to trace anybody. That said, it may also be an overly complicated way of saying that once the property is sold on, the vendor no longer has to pay rentcharge as the requirement is passed on to the buyer (I know these things don't need to be detailed on title documents, but it seems they commonly did so anyway in earlier British legal traditions).

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Tue Jul 30, 2019 8:55 am

Hmm ,thanks for posting FilthWizard .

I was aware that I hadn't posted any extracts about positive covenants ,mainly because there seemed to be so many . But on a v quick re skim this morning I,m not so sure .

But there is certainly one relating to a piece of land at the front of the building the use of which is shared with houses facing it . About maintaining walls and fences .

I could type it out if you were interested ? i'm off to the wilds shortly and internet access is poor .

I might post the baffling passage in the conveyancing section of the Landlord zone .

FilthWizzard
Posts: 37
Joined: Wed Aug 15, 2018 2:00 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by FilthWizzard » Tue Jul 30, 2019 11:11 am

That would be helpful to post. Please note that the title docs may contain many positive covenants. None of them matter for this issue unless they are explicitly linked to the rentcharge, so the rentcharge is explicitly paid for the purpose of maintaining one or more covenants.

So the rentcharge is paid in order to fund the maintenance of a fence/path/wall/hedge/ditch etc. by others? That is constructive.

So the rentcharge needs to be paid, but there is a separate covenant about maintaining a fence/path/wall/hedge/ditch etc. yourself? Then the rentcharge is not constructive.

violetqueen
Posts: 34
Joined: Tue Jun 24, 2014 8:57 pm

Re: Historic rentcharges Bristol Bath Manchester

Post by violetqueen » Wed Jul 31, 2019 4:27 pm

some extracts re things that must be done ( positive covenants ? ) and things that musn't be done ( negative ? )

"hereby grant unto LB all that plot of land ...part of a certain close of Pasture Ground ...and adjoining other land lately granted by the same IP to the same LB and the messuage now being erected thereon.AND ALSO ALL THAT messuage dwelling house or Villa with the outbuildings and appurtenances now being erected by the said LB"


stuff about connecting to drains gutters sewers "which now exist or from time to time may be made Together also with the use in common with the said owners and occupiers of a certain pleasure ground delineated on the said plan he the said LB his heirs etc paying a proportionate part in common with such several owners and occupiers of the expense of keeping the said pleasure ground in order and of maintaining and painting the fences hereof......"

"And also that the said LB his heirs executors etc will within 6 calendar months from the date hereof at his and their own cost enclose the said plot of ground hereinbefore expressed to be hereby granted with a Wall which shall be then several lines of what the wall must be built of ,topped with height etc

plus stuff about not having a pigsty on plot ,having a flat roof on any stable/coachhouse etc

Post Reply