Where a landlord of a block of flats wishes to sell certain interests in that building, in most cases, he must offer “first refusal” to the tenants of the flats in the block. Where the right applies the landlord must serve a formal notice on the leaseholders setting out the terms he proposes and offering to sell to them first. He must then allow at least two months for the leaseholders to consider and (if they wish) accept the offer. The provisions are slightly different where the proposed sale is to be at auction but similar rights apply.
A failure to do so is a criminal offence and where your landlord does fail to comply with his legal obligation you may be able to force the new landlord to sell the interest to you on the same terms he acquired it.
Clarke Mairs has extensive knowledge and expertise in acting for landlords and tenants in rights of first refusal transactions and can guide you through the whole process – from offer notice to completion – providing clear advice and guidance at each stage.
If you think your landlord may have breached his obligations, you would like to know whether the right of first refusal applies to your block of flats or you have received a notice offering you the right of first refusal, please contact Katy Rushworth directly on 0191 245 4725 or firstname.lastname@example.org.
In addition, some useful independent guidance on the rights of first refusal can be found at www.lease-advice.org.
Frequently Asked Questions
I received a notice offering me the right of first refusal. What should I do?
You should contact a solicitor, ideally with a copy of the notice and any other correspondence you have in relation to the matter, as soon as possible.
The notice should set out a date by which you must respond if you wish to accept the offer. If you do not respond within that time frame then the landlord is entitled to dispose of the interest without any further consultation with you. Bear in mind that you will need to gather together the other leaseholders, agree how the purchase will proceed, how much each of you will contribute and likely incorporate a company and instruct solicitors to act for you before you are able to accept the offer. It is therefore imperative that you contact solicitors as soon as possible so that you can obtain advice in relation to the notice and what you need to do to accept the offer well within the time frame given in the offer notice.
See the collective enfranchisement page for general information on buying the freehold of a block of flats.
I recently found out that my landlord sold the freehold or the head lease without telling me. What can I do?
You should contact a solicitor as soon as possible with any information you have about the disposal. We can consider the terms of the disposal and advise you as to whether the right of first refusal applied and, if so, what action can be taken.
I received a rights of first refusal offer notice. Can I accept it on my own?
No – an “acceptance notice” must be served by more than 50% of the leaseholders of the total number of flats in the building let to qualifying tenants (tenants with long leases). Where there are only two flats in the building the leaseholders of both those flats must together serve the acceptance notice.