Conveyancing solicitor’s negligence in failing to advise adequately about onerous ground rent review clause
Our client, Miss C, purchased a flat in 2005 for £120,000. She was a first time buyer and had no experience of leasehold properties. The lease she was buying contained a very onerous ground rent clause which allowed the landlord to increase the ground rent every 21 years to an amount equal to one sixth of the open market rent for the property. The next increase took place within 15 months of our client’s purchase and the ground rent went from £100 per annum to £1374 per annum - a thirteen-fold increase. Miss C’s conveyancing solicitors, Rumke Joseph and Rabin, failed to adequately report the terms of the ground rent review clause to her, when the next review would take place, send her a copy of the lease which contained the ground rent clause, or explain how unusual a term this was. The increase in ground rent was significant when given the modest value of the property.
We obtained expert evidence regarding the loss in value of the property as of the time that Miss C bought the property and issued a claim on her behalf after her conveyancing solicitors denied liability for the claim. The claim settled shortly after service of the solicitor’s Defence.