The scandalous ground rent charges at Blythe Court featured on BBC Radio 4’s You & Yours programme just before 1pm today.
It can be heard here at 31.43
Leaseholders at the site were interviewed, including Kadian Kennelly, 32, and Patrick Majszyk, 32.
Sir Peter Bottomley said he was still seeking explanation from the site’s freeholder and manager, Martin Paine and his wife Margaret Anne Kirmond.
Sebastian O’Kelly, of LKP, who was also interviewed, advised that leaseholders facing similar circumstances should make sure that their freeholder’s actions become very well known, through the involvement of MPs, press, LKP etc.
He described the deed of variation as a “poison pill”, compared the ground rents at Blythe Court to One Hyde Park in central London and suggested commonhold as an alternative to leasehold with its incessant game playing.
It now emerges that Martin Paine and Margaret Anne Kirmond “understand the need for a more ethical approach to charges, in line with our company philosophy”.
In addition, Martin Paine claims: “We are keen to highlight that many of the points made in the Leasehold Knowledge Partnership online article (published 21st January) are not correct and we are seeking legal counsel on the inaccuracies made.”
Martin Paine acknowledged receipt of the article, which he had for 72 hours before publication.
He has made no effort to address any alleged inaccuracy.
It is understood that Martin Paine is now employing a media consultant / public relations executive.
After the programme today, Kadian Kennelly received the following communication and “press release”.
Dear Ms Kennelly
We are aware that the lease terms at Blythe Court have been gaining considerable press interest.
On Friday we issued the following statement and would now like to start a dialogue with you regarding this issue.
I appreciate you are busy, so please let me know when would be convenient for me to chat with you.
I will be liaising with all affected residents on a one to one basis in order to allow for individual diaries, differences in circumstances and contracts.
Kind regards
Martin Paine
Press statement
Following concerns raised by residents at Blythe Court in Coleshill, Warwickshire, Circle Residential Management Limited has agreed to a dialogue with leaseholders regarding payment of their ground rent.
Company director, Martin Paine said;
“While the terms of the lease at Blythe Court are not uncommon and were advised by our legal team at the time, we understand the need for a more ethical approach to charges, in line with our company philosophy. Although we have tried to give direction to owners in the past, we will now start a more formal dialogue with the affected leaseholders.
“We are keen to highlight that many of the points made in the Leasehold Knowledge Partnership online article (published 21st January) are not correct and we are seeking legal counsel on the inaccuracies made.
“Our priority now, however, is to liaise with the leaseholders so that they can feel positive about their homes and the investment they made in Blythe Court.”
ENDS
Notes to editors:
· The article and blogs published on this matter attack company director, Anne Kirmond. Anne, nor the freehold owning company sold flats to the current tenants nor were they involved in the auction of flat one.
· The CBRE 2010 report into ground rent states; “We consider a rental uplift pattern of every 10 years to be optimal. This provides a regular review without becoming too frequent as to cause administration issues or to create discontent among lessees.”
Related posts:
Barnard Marcus withdraws Blythe Court flat from auction
Hogan Lovells property solicitors report Blythe Court scandal on website
Stop auction of ‘worthless’ flat at Blythe Court and alert authorities, Commons asked
Guardian reports the Blythe Court ground rent scandal
Martin Paine sells on Blythe Court, where ground rents reach £8,000 a year
80% of Londoners like living in a flat, even ones run by FirstPort
I want to know what the leaseholders conveyancing solicitors have to say about these crazy leases.
conveyancing solicitors genuinely defending the interests of their property buying /first-time buyer clients should warn their clients against signing a document (lease or head lease) designed to serve the interests (profit-maxiimisation in the long term) of the freeholder.
Leases are one-sided documents with huge consequences for the lessee.
Unfortunately the solciitors profession is benefiting immensly from these activities
One example: The very lucrative “lease extensions” where solicitor firms can pockets two, three , four or ten thousand pounds simply to read, draft a lease, a few letters and a signature.
Any industry benefiting from “leasehold laws” will have little appetite for ending the system
I have a cunning plan! Could it work?
What would happen if the leaseholders applied for a statutory 90 year lease extension?
Would that not reduce the ground rent to a peppercorn amount?
The cost of the extension would then have to be challenged in the Tribunal, thus possibly reducing the extortionant fees being currently charged?
The CBRE 2010 report into ground rent states; “We consider a rental uplift pattern of every 10 years to be optimal. This provides a regular review without becoming too frequent as to cause administration issues or to create discontent among lessees
Yes, maybe every 10 years going forward from NEW signatory… but not back dated to the year of the original build (In this case constructed before the lass was even born!!) for new lease holder to deal with…..what a shabby, greedy system.
I’m still amazed (or should that be amused) that the useless conveyancers are getting caught out and suffering as a consequence. It really is Rat eat Cockroach out there
In my view there should be no liaising one to one and cosy chats. This is what freeholders and their lawyers do, when it’s time to cover things up. The legal position as a whole needs to be made clear and the leaseholders need to form an association or RTM if eligible. ( and if not why not? Change the eligibility factors) and present a unified stance to the freeholder. That is our only chance, till Parliament chooses to save us.
Agreed 100%, do not get involved in one to one and cosy chats. This is what freeholders and their lawyers do, when it’s time to cover things up.
It needs to be leaseholders and their representatives, at any meetings. Total, total transparency.
I am sure the leaseholders won’t mind so what problem has the freeholder/Paine got
No cosy chats under any circumstances. It is too late for that,. Everything must be in the open.
Whether my previous idea is a runner or not, at the very least the lease is flawed and needs to go before a court to be repaired by an agreed variance of lease..
This is the only way to protect leaseholders.
If the affected leaseholders are to begin ‘liaising’ with the freeholder, then it is certainly advisable to enlist the assistance of a legal professional who is familiar with the business interests of Martin Paine and Anne Kirmond. More haste and less speed perhaps?
If the offer by Martin Paine to act in a more ethical manner IS genuine, then it should be persued. The only advice I could offer would be to remain cautious.
How wonderful to see Mr Paine rushing gallantly to save the reputation of the damsel Anne whose escutcheon has been blotched by some piffling inaccuracy, Or has it? We can’t tell.
I have a hunch, and it’s only a hunch, that Anne’s conscience has been troubled and there have been domestic recriminations; fear, perhaps, of being seen in Lower Slaughter to have the blood, sweat and tears of the less well off on one’s hands. Fear of being seen as enriching oneself unjustly through deeply unethical, shameful, anti-social, predatory behaviour. That would be a very justified fear if there were any decent people in Lower Slaughter. Or any tumbrils.
Blaming the lawyers is neither credible nor good enough. What would be is this:
1. A public apology to the leaseholders
2. An offer to sell them their freehold for a token amount
3. A donation to any of the charities working to end leasehold exploitation by monetising freeholders
4. A commitment never to engage in such behaviour again
Headline: MARTIN PAINE DOES THE DECENT THING.
Circle Residential is our freeholder’s manager so this caught my ear. Thank you for bringing it to public notice. Martin Paine seems to be a Fellow of the Property Consultants Society, a Member of the Institute of Residential Property Management and a Member of the Institute of Directors. It would be worth checking what the professional conduct panels of those institutions think of his behaviour.
The IRPM code of conduct is below (1. and 6. seem particularly relevant)
CODE OF CONDUCT
This code of conduct forms an integral part of the conditions of membership. It relates solely to the way in which the Society requires members to conduct their activities. The code must not be taken by clients, applicants or others as in any way affecting the legal relationship between themselves and the firm or member.
1. No member shall engage in any practice which is deemed by the Council to be inconsistent with the standards required of members of the Society
2. No member whilst acting as a consultant shall divulge to a third party, confidential information relevant to a client’s affairs without the specific consent of the client.
3. Members who are principals shall be held responsible to the Council for the acts of their business partners and staff. In so far as they relate to conduct and matters within the scope of their practice.
4. Each member must make full and immediate disclosure of any conflict of interest arising from their involvement in a transaction. In such circumstances they should withdraw from the transaction unless the client, after taking advice, specifically requests that they continue.
5. No member shall exert undue pressure or influence on any person with the object to obtain business.
6. Members must behave lawfully, honestly and avoid issuing misleading information or statements. This applies to dealings with clients, potential clients or other professional representatives including fellow members.
7. No member shall engage in a practice considered by the Council to be unfair toward another member. Members in dispute must bring it to the notice of the Executive Council before engaging in litigation. In the event that the Council is asked to arbitrate, its considered decision is binding on all parties.
8. Members must be familiar with, and act strictly in accordance with the relevant laws of the country or countries in which they operate.
9. Every member shall keep personal and business trading finances separate from that of their clients.
10. When accepting instructions a member must notify the client in writing of the terms, conditions, charges and expenses.
From James B
Dear Sir Peter Bottomley MP
I confess to not being a constituent of yours, and I have CC’d Richard Drax MP as he represents South Dorset, but I wanted to extend my heartfelt thanks on behalf of my family for your committment to changing the feudal form of leasehold tenure that persists into the modern age in England & Wales.
After being informed about the problems at Blythe Court by Sebastian O’Kelly of LKP, and listening to the resident’s accounts on ‘You and Yours’, it resonates particularly deeply because this has been pretty much my family’s and neighbour’s experience since property developers acquired the freehold in 2005. There is nothing more insidious to one’s lives than issues affecting one’s home and principal asset. Once a property is blighted through disputes raised by the freeholder, you cannot just walk away from it, and so leasehold has become a modern form of slavery.
It is time for these issues to be brought to a head and be resolved once and for all, preferably by Commonhold tenure as in the rest of the civilised world, and no-one, as far as I know, has done more than yourself in working towards that conclusion.
Yours sincerely
James B
Excellent point: “these issues to be brought to a head and be resolved once and for all, preferably by Commonhold tenure as in the rest of the civilised world, and no-one, as far as I know, has done more than yourself in working towards that conclusion.”
Ultimately this is the way forward to resolve all issues and the exploitation – us leaseholders- are having to endure.
Has anybody trawled through the Circle Residential Management website. You couldn’t make 90% of the stuff up. Many of the statements have no credibility whatsoever.
The founding Director Martin Paine FPCS, MIRPM has over 25 years in the property industry,
Martin’s attention to detail and sound judgement is highly valued by clients.
We believe in solving any problems swiftly, fairly and equitably.
We are equally accessible to both freeholders and their lessees.
Professional, worry-free management of leasehold properties.
Circle Residential Management is committed to providing a courteous and professional service to Flat Owners and to members of the public.
We’ll organise maintenance for the building and communal areas.
We are delighted to answer any questions, queries or concerns you may have at any time.
Move onto the “Lessee” section, of the website, scroll to bottom of page and open up the “Management Fees” pdf list.
Excluding London Areas, never in my working life have I seen management costs to Lessees as bad as most of these.
£70.00 to supply a copy of the Lease. £70.00!!
In my business model its FOC if you want it electronically by e mail. Takes 5 minutes to draw a copy lease off files. Prefer it in hard copy form, no problem, £10 plus postage.
I could just go on and on but…………..
Martin Paine, you make Peverel/Firstport look like angels
I totally disagree about Peverel/ Firstport “look like angels”.
I have been their (OM, Estate & Management, OM Peverel previously & all the other names they have used) ” so called customer ie Leaseholder over 30 years.
Nothing but constant problems, lies, poor maintenance the list could go on and on.
It took a year to get a dispute over replacing windows settled, every trick was played.
It also took a year to get the Lease extended it was absolutely nightmare. I can only be grateful to LKP/Campaign against retirement leasehold exploitation and About Peverel Home for advice and help. Since I never have heard of The antiquated rip off Leasehold.
I had a narrow escape not to fall to the trap of the additional clause “only change of wording, all the Leases have the same clause” in fact it was a clause that “I could have loose “my property” for any excuse” as my Solicitor put it.
Estates & Management offered a copy of the Lease: one page £25 and £75 for three pages without even asking as my Solicitor had the original hard copy of the Lease document.
The only way to stop the Leaseholders abuses, rip offs is to abolish it completely. It is not fit for any Century let along the 21st.
Mystified, I think you misunderstood my sarcastic comment. I did NOT say Peverel/First Port ARE angels.
I am fully aware of what position they hold in the worst in the country to best in the country scale!!
Urging everyone reading this, even if they are not leaseholders themselves, but perhaps have a child or a close friend who is. (and house prices being what they are, a leasehold flat is often the only stepping stone to the property ladder.) Write to your MPs, ask them what is their stance on commonhold and what steps are being taken to make ‘home ownership’ accessible and diminish the power of freeholders. (they should be taxed into oblivion making it unprofitable for residential freeholds to be a viable business – starting by disallowing them the perk of passing costs on to leaseholders. ) Don’t wait for disaster to strike on your door, it will be too late by then, write to your MPs now and ask them how exactly, they are planning to resolve this unfair and antiquated law. The ground rent fiasco demonstrated here, is only one type of gross exploitation, there are numerous cosy arrangements, most not quite as obvious to spot or easy to understand.
This clearly an extreme case. normally it is not the ground rent which is often only a few pounds and costs a lot to collect that makes a profit for the freeholder.
It is the power that a freeholder has(for very little outlay) to appoint themselves as managing agents, arrange insurance and invent a need for work to be done, plus all manner of charges they impose on leaseholders that is the golden goose. By the use of connected companies, they can liberate service charge funds in an exploitative method, which technically gets around the law that the freeholder is entitled to recover costs from a freeholder, but not make a profit.