Earlier this summer Mark Loveday of Tanfield Chambers was successful in the Court of Appeal on a key point which could affect hundreds of thousands of existing shared ownership lessees and more in the future.
The case of Avon Ground Rents v Canary Gateway concerned the lessees of Canary Gateway and their lengthy attempt to take over the management of their building using the Right to Manage process. They started their claim in 2019 pre covid and several First Tier Tribunal and Upper Tribunal decisions later found themselves in the Court of Appeal on this specific point.
Avon Ground Rents argued that twelve of the leaseholders who were taking part did not qualify because they had not staircased their leases to 100%. The Court of Appeal disagreed with Avon Ground Rents and preferred Mr Loveday's evidence on behalf of the leaseholders. They said "Tenants who have long shared ownership leases who have not staircased to 100% will still have an obvious interest in how the premises are managed, the more so since they will typically pay full service charges. That being so, Parliament might have been expected to have intended them to be able to participate in management issues".
This was good news for Canary Gateway and meant that they could go on to take over the Right to Manage and will undoubtedly be good news for other blocks where there are shared ownership flats who might not otherwise have had enough participants to take over the management.
There are wider implications however and further good news for those same lessees because the wording of the Commonhold and Leasehold Reform Act 2002 which defines a " long lease" is identical to that of the Leasehold Reform Housing and Urban Development Act 1993 which governs lease extensions and collective enfranchisement, meaning that those lessees will also be able to extend their leases or join in a collective claim.
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