24 Caldershaw Road, London W13 9DX LON/00AJ/OAF/2024/0009
DECISION
2 Description of hearing This has been a determination by remote hearing on the papers. The form of remote hearing was P:PAPERREMOTE. A face-to-face hearing was not held because no-one requested the same and all issues could be determined in a on paper. The documents that the Tribunal were referred to are in a bundle of 51 pages, which included the Order of Brentford County Court (Claim Number L00BF465) and a valuation by Mr M Geoghegan MRICS dated 15 July 2024. A draft Transfer was not in the bundle but, at the request of the Tribunal, was provided subsequently. Determination[1]The Tribunal accepts Mr Mr Georghegan’s valuation of the premium at thirty one pence but finds it appropriate to round this up to one pound (£1.00).[2]Under the Act it is for the County Court to approve the form of conveyance. Background[3]This is an application made by the applicant qualifying tenant pursuant to section 27 of the Leasehold Reform Act 1967 (“the Act”) for a determination of the sum to be paid by it for the vesting in it of the freehold of 24 Caldershaw Road, London W13 9DX (the “property”) where the freehold landlord cannot be ascertained.[4]Since 27 November 2012 the applicant has been the registered leasehold owner of the Property under a lease dated 12 May 1891 made between Charles Jones (1) and George Witney Pearce(2) and Loiuse Westwood Pearce (3) for a term of 999 years from 25 December 1889 at a rent of 6 pence (2 ½ p) per annum.[5]By an Order of the Brentford County Court (Claim Number LooBF465) dated 21 March 2024 the matter of the determination of the price of the freehold was remitted to the Tribunal. The issues[6]In the absence of the Landlord there are no matters agreed. The Tribunal’s determination[7]The case was dealt with on the papers on 4 December 2024 with the documents referred to above provided by the applicants’ solicitor.[8]The Tribunal was not asked to inspect the property and the Tribunal did not consider it necessary to carry out a physical inspection to make its determination. 3[9]The applicants relied upon the expert report and valuation of Mr M Georghegan MRICS dated 15 July 2024. The valuation report[10]The valuation report prepared by Mr Martin Geoghegan, a RICS registered Valuer and dealt with the following matters.[11]That the appropriate basis of valuation of the Property is in accordance with section 9(1) of the Act. Mr Geoghegan had been unable to ascertain the rateable value of the Property in 1966 but had been able to establish, verbally from Thames Water on 22 February 2024, that its rateable value in 1973 was £290.[12]Mr Georghegan considered the three sections to a valuation under section 9(1) of the Act in turn.[13]Capitalisation of the ground rent Mr Georghegan submitted that a capitalisation rate of 8% was appropriate, where, as in this case, the ground rent is particularly low and fixed for the duration of the term, referring the Tribunal to the decision in Nicholson v Goff [2007] 1EGLR 83.[14]Capitalisation of the section 15 modern ground rent Mr Georghegan submitted that given an unexpired lease term of 864.73 years any capitalisation of rent deferred for that length of time will produce a nil valuation.[15]Value of the freehold reversion at the end of a 50 year lease extension Mr Georghegan submitted that no sum should be attributed to this element of the valuation as any 50 year lease extension will be in 864.73 years and the valuation of any sum will be nil when deferred by this unexpired lease term.[16]Mr Georghegan valued the price payable under the Act for the freehold at thirty one pence (30.31p). The Tribunal’s determination[17]The Tribunal determines that the price payable for the freehold is one pound (£1) Reasons for the Tribunal’s determination[18]The property is subject to a lease of 999 years from 25 December 1889. The valuation date is 18 March 2024, which gives an unexpired lease term of 864.73 years. 4[19]The Leasehold Reform Act 1967 requires the rateable value of the property in the 1966 rating list to be of less or equal to £400 for a property in Greater London for a valuation in accordance with Section 9(1) of the 1967 Act. The Applicant’s surveyor was only able to establish the rateable value of the property of £290 in the 1973 rating list. The Tribunal finds on the evidence before it that the rateable value in the 1966 rating list would have been considerably less than £400.[20]The Tribunal agrees with the Applicant’s surveyor that the capitalisation rate for the capitalisation of the existing ground rent should be set at 8%.The Tribunal also agrees with Mr Georghegan that the capitalisation of the Modern Ground Rent, being deferred by 864.73 years would result in a nil valuation. It also agrees with Mr Georghegan that the value of the 50 year lease extension would also be nil when deferred by the unexpired lease term. Its valuation is set out in the Appendix.[21]The Tribunal agrees with Mr Georghegan’s valuation but finds it appropriate to adopt a premium of one pound (£1) rather than £0.31. Say £1.00 The Transfer[22]Under the Act it is for the County Court to approve the form of conveyance. Name: Judge Pittaway Date: 4 December 2024 APPENDIX 5 Valuation Valuation Date 18 March 2024 Unexpired lease term 864.73 years FHVP Value Nil Capitalisation of Modern Ground Rent Existing Ground Rent £0.025 pa YP 864.93 years @ 8% 12.5156 £0.31 Reversion Nil Total Premium £0.31 Say £1.00