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Freehold covenant (or not?) in a Building Scheme

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  • Freehold covenant (or not?) in a Building Scheme

    This is my first post and I would be very grateful if anyone could offer me some guidance because I am at my wits' end.

    I own a freehold house in a building scheme governed by a common deed of covenant. The deed of covenant contains both restrictive and positive covenants; for example, the management company allegedly provides services such as repairing and externally redecorating my windows as well as common services such as maintaining the private road and communal gardens, in return for an annual service charge. Well, theoretically anyway.

    In practice, the management company allowed my windows to rot for 18 months after I first reported signs of deterioration. The rot was probably made worse by the fact that instead of carrying out external redecoration every four years, as per the covenant, the management company have only done this once in 11 years.

    I recently wrote to the management company, offering to repair and repaint my own windows to the same specification and standard as those of my neighbours, and to absolve the management company from all future responsibility in return for a corresponding reduction in the annual service charge. At first, they agreed in writing but followed this up two weeks' later with a letter stating that while they were content for me to repair and pay for my own windows, they still wanted £1700 as a contribution towards the cost of repairing and repainting my neighbours' windows "as per the covenant" (service charge based on floor space, not on actual cost of work). My neighbours are also freeholders and I can find nothing in the covenant to justify this demand.

    I am actually the third owner of the property. I didn't sign a covenant of any kind because the person from whom I bought the house hadn't signed it either. In fact, this previous owner had obtained indemnity insurance - for himself and his successors in title - because the original deed and covenant had been lost. I have searched the deeds of my house thoroughly and although there is a reference to the covenant, there is no reference at all to a rentcharge or estate rentcharge.

    I have no wish to breach any of the restrictive covenants and I am perfectly willing to carry on paying for the services I use or enjoy such as the private road and the gardens. However, I really want to take over responsibility for maintaining my own windows instead of waiting for the rather useless management company to get around to it. I have offered to provide a legally binding document that would absolve the management company of any responsibility for maintaining my windows, in return for a correspondence reduction in service charge - but the management company is adamant that because my house is situated in a building scheme, there can be no variation to the current arrangements. They are quite immoveable on the subject.

    I have found lots of references to restrictive covenants + building schemes, but very little about positive covenants + buildings schemes, particularly if a freeholder wishes to reject or decline a service and take up the responsibility themself.

    If anyone has had a similar experience or can offer any help, I would be very grateful. Thank you.

  • #2
    Re: Freehold covenant (or not?) in a Building Scheme

    A building scheme doesn't help with the enforcement of positive covenants. Unless there is a rent charge secured on the property if you did not sign any dee d of covenant when you bought I can't see how they can make you pay anything so I would start off by asking them to justify the legal basis on which any money is collected.

    Having said that there are cases that seem to say that if you are given rights in return for payments e.g to use an access way in return for paying for its maintenance then the money may possibly be collected with the collector perhaps having to go to the last resort of preventing you using the access way or other facility. This is not very clear cut though so I would ask them to justify how they claim legally to be collecting the payment and see what they say.

    A lot of these management schemes on freehold estates break down because they weren't thought through properly in the first place. Essentially if a rent charge is not used they have to have a system of restrictions on the title register of each house that prevents a transfer being registered without a certificate from the management company which is only provided when a deed of covenant has been signed. If you did not sign any such deed then someone must have forgotten to include this provision in the original estate transfer deeds.
    RICHARD WEBSTERwww.rwco.co.uk
    As a conveyancing solicitor I want to be helpful (England/Wales only) but can't accept liability for this.

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    • #3
      Re: Freehold covenant (or not?) in a Building Scheme

      Thank you for such a quick response. If I understand correctly, the fact that it is a building scheme does not mean that it automatically and completely falls outside the usual conventions regarding a freehold positive covenant - which is what the management company is claiming?

      The title register does say that the property cannot be transferred without a certificate from the management company. In fact, the management company did provide the certificates, both for the purchase by the second owner and for my subsequent purchase of the house. However, on neither occasion did they obtain a signed deed of covenant, probably because they really are so useless. Does this mean that I am no longer bound by the covenant? Or that I can offer to replace it with a similar arrangement? Sorry if these are obvious questions. Thanks.

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      • #4
        Re: Freehold covenant (or not?) in a Building Scheme

        However, on neither occasion did they obtain a signed deed of covenant, probably because they really are so useless. Does this mean that I am no longer bound by the covenant?
        That would seem to be the case, Yes. (You have already told us that there is no rent charge or estate rent charge which would be the only other way it could be collected.)

        You can of course offer to sign a deed but you could seek to limit your liability under it so as to exclude the matters you are not happy to pay for.
        RICHARD WEBSTERwww.rwco.co.uk
        As a conveyancing solicitor I want to be helpful (England/Wales only) but can't accept liability for this.

        Comment


        • #5
          Re: Freehold covenant (or not?) in a Building Scheme

          I am very grateful to you for your kind help, which has clarified my understanding and has also given me the heart to continue challenging this selectively-deaf management company. I will do as you suggest and let the forum know how I go on in case it is of benefit to others in similar circumstances (although it could be some time before I have any news to report because the management company is not only intransigent but painfully s-l-o-w to respond). Thank you again - much appreciated.

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