Your questions answered

Dear Colin,
Technically the landlord is correct. However, if you went down the right to manage route you would be able to select your own insurer. The landlord is taking commission or his broker is taking a high commission, either way even in your quotation there will be commission. So the premium is excessive. I would recommend going to the landlord and saying that you could take over his responsibilities through right to manage and he will loose all commission or he goes with your better value quote for the premium. It might be worth asking for details of the commission and also checking who is FSA or RICS registered.
Roger Southam, chairman and chief executive, Chainbow

Dear Colin,
Insurance comes within the definition of a service charge under Section 18(1) of the Landlord and Tenant Act 1985. You can challenge the reasonableness of the charge and your liability to pay on application to the LVT. If your landlord will not accept your like-for-like quote, and you don’t want to go down the right to manage route then this is another option for you.
Nicolas Shulman, director,
News on the Block
 

Q Dear News on the Block,
I am a shareholder in and director of the company that owns the freehold of a 33-unit estate. The lease is defective. The directors and shareholders want to either alter the existing lease or draw up a new one. We are having difficulty in finding a solicitor who is willing to take on the work and we are unable to assess how much the venture is likely to cost. Can we use the services of the LVT to (a) extend the lease by 90 years and (b) amend one of the clauses relating to the payment of service charges?
Audrey Jones, The Croft Ealing Ltd

Dear Audery
Getting a defective lease amended and extending a lease are both areas that the LVT will have some involvement with, however the process is not straightforward.
To quote the LEASE website (www.lease-advice.org) regarding lease extensions: “There is a substantial amount of work to be completed before you start.” The areas that need to be considered are:
Checking eligibility (including identifying the competent landlord)
Selecting and instructing professional advisers
Assessing the premium
Establishing the finance
Gathering the information
Preparing the notice
Thereafter preparing for the subsequent applications

You will need professional advice and assistance from a solicitor and a valuer at some stage and you may well find that your local high street solicitor/ valuer is not able to deal with this kind of work because it is a specialist area.
The LVT has the power to vary long leases of flats – a long lease is defined as one that has been granted for a term exceeding 21 years.
Your question does not specify in what way the lease is defective. The grounds for seeking a variation of a lease are in Part IV of the Landlord and Tenant Act 1987 and include where the lease fails to make satisfactory provision with respect to the following:
(a) The repair or maintenance of
(i) the flat in question, or;
(ii) the building containing the flat, or;
(iii) any land or building which is let to the tenant under the lease or in respect of which rights are conferred on him under it;
(b) The insurance of the building containing the flat or of any such land or building;
(c) The repair or maintenance of any installations (whether they are in the same building as the flat or not) which are reasonably necessary to ensure that occupiers of the flat enjoy a reasonable standard of accommodation;
(d) The provision or maintenance of any services which are reasonably necessary to ensure that occupiers of the flat enjoy a reasonable standard of accommodation;
(e) The recovery by one party to the lease from another party to it of expenditure incurred or to be incurred by him, or on his behalf, for the benefit of that other party or of a number of persons who include that other party;
(f) The computation of a service charge payable under the lease.

Any party to a long lease of a flat may apply for the variation of a lease. Also, applications for variation may be made in respect of two or more flats where there is a consensus for that variation from the majority of parties to the leases. Furthermore, where the variation of one lease would affect other leases, then an application may be made to vary those other leases.
Parties affected by the variation have to be notified. For example, this may include other tenants or any superior landlord or mortgagee.
When you apply to the LVT you must provide a draft of the wording of the lease variation. If the LVT decides that it will vary the lease it will either adopt that wording or substitute other wording, as it considers appropriate. You will find more information at www.rpts.gov.uk