Home Information Cases Falmouth House Ltd v Lidouch Rahmizadeh (2008)

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Falmouth House Ltd v Lidouch Rahmizadeh (2008)

Summary

The first determination by a surveyor of the cost to a nominee purchaser to purchase the freehold of a block of flats under a collective enfranchisement was final and it was not open to the nominee purchaser to seek further contributions from certain leaseholders towards the purchase price.

Facts

The appellant nominee purchasers (F) appealed against a judge's decision on a purported determination as to the cost of enfranchising the respondents' leases. The respondents (R) cross-appealed against the judge's decision that an earlier determination was invalid. F had been formed for the purpose of acquiring the freehold of a block of flats pursuant to a collective enfranchisement of the occupying leaseholders' leases. R occupied flats under leases that had approximately seven years left to run. F entered into participation agreements with R to enfranchise their leases. Under the agreements R covenanted with F to pay their contribution of the price payable for the transfer of the property to F, to be determined exclusively by F's surveyor. F's surveyor carried out a determination of the cost of purchasing the freehold and prepared a schedule showing the appropriate contributions required from the various leaseholders of the block. They paid the sum requested of them and F granted them new 999-year leases. Thereafter F's surveyor produced a further determination that purported to show that R owed additional sums by way of a further contribution to the enfranchisement of their flats. The instant proceedings were commenced. The judge held that the first determination by the surveyor was provisional and that it had been open to F thereafter to call upon the surveyor to make a final determination pursuant to the participation agreements. The judge found that the second determination was valid and made a declaration to that effect. The judge further held that F was not entitled to a money judgment against R.

Held

On the evidence it was clear that the first determination made by F's surveyor was not provisional and that it was made for the purpose of identifying the contribution to the freehold purchase price which would be contractually due from the respective leaseholders. The participation agreements provided for the determination exercise to be carried out once in relation to any particular price. The evidence before the judge was that the price was apportioned by the surveyor and that that price did not change. Accordingly it was not open to F to invite its surveyor to carry out a second determination.

Appeal dismissed, cross-appeal allowed

Chancery Division
Morgan J
Judgment date
12 February 2008
References

​LTL 19/2/2008 : (2008) NPC 17 

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