Leasehold valuation tribunal
Encyclopedia
A Leasehold Valuation Tribunal (LVT) is a statutory tribunal
in England
which determine various types of landlord
and tenant
dispute involving residential property in the private sector
. An LVT consists of a panel
of three; one with a background in property law (generally a solicitor
); one with a background in property valuation generally a qualified surveyor
; and a layman
, although some decisions of an LVT may be decided by a single member. LVTs are Non-Departmental Public Bodies
.
which transferred jurisdiction from the Lands Tribunal (a Superior tribunal of England
and Wales
), functions have since been expanded by the Leasehold Reform, Housing and Urban Development Act 1993 and the Commonhold and Leasehold Reform Act 2002
.
Historically, when a lease
ran out the property held there under would revert to the possession of the landlord/freeholder. In this case, the job of the Leasehold Valuation Tribunal is to hear evidence from both sides as to what the long leasehold value of such a property would be and to determine what proportions of value of the said property should rightfully be ascribed to leaseholder and the freeholder under the legislation. Generally such evidence is given by an expert witness
for each side who will argue that a particular value is more applicable based on an analysis of recent sales of comparable properties around the date that the Leasehold Enfranchisement Notice was served.
In many parts of the UK there are substantial freeholders who historically have owned and continue to own large land holdings, and this ownership has been and continues to be passed under leased ownership to sub landlords and leaseholders; this system was particularly suitable when areas of London
were initially built on greenfield land, and later in the period immediately after the WWII, when considerable renovation and rebuilding was urgently required, the estates were able to effectively sub contract redevelopment to sub landlords, known as head lessors.
The most notable London
estates are those of the Crown Estate
, the Duke of Westminster
, Earl Cadogan
, and Lord Howard de Walden; with the changes in legislation these freeholders are now obliged to sell lease extensions under the various Acts of Parliament which have been passed at prices agreed by negotiation or determined by the Leasehold Valuation Tribunal. Appeals against decisions of the Leasehold Valuation Tribunal are made to the Lands Tribunal.
A legally qualified chairman sitting with a Chartered Surveyor
and a lay member usually constitute the tribunal. However, a small number of chairmen are chartered surveyors and a small number of members of other professions have also been appointed to sit. Chairmen are appointed by the Lord Chancellor
and other Members by the Secretary of State.
Tribunal
A tribunal in the general sense is any person or institution with the authority to judge, adjudicate on, or determine claims or disputes—whether or not it is called a tribunal in its title....
in England
England
England is a country that is part of the United Kingdom. It shares land borders with Scotland to the north and Wales to the west; the Irish Sea is to the north west, the Celtic Sea to the south west, with the North Sea to the east and the English Channel to the south separating it from continental...
which determine various types of landlord
Landlord
A landlord is the owner of a house, apartment, condominium, or real estate which is rented or leased to an individual or business, who is called a tenant . When a juristic person is in this position, the term landlord is used. Other terms include lessor and owner...
and tenant
Leasehold estate
A leasehold estate is an ownership of a temporary right to land or property in which a lessee or a tenant holds rights of real property by some form of title from a lessor or landlord....
dispute involving residential property in the private sector
Private sector
In economics, the private sector is that part of the economy, sometimes referred to as the citizen sector, which is run by private individuals or groups, usually as a means of enterprise for profit, and is not controlled by the state...
. An LVT consists of a panel
Judicial panel
A judicial panel is a set of judges who sit together to hear a cause of action, most frequently an appeal from a ruling of a trial court judge. Panels are used in contrast to single-judge appeals, and en banc hearings, which involves all of the judges of that court.In the United States, most...
of three; one with a background in property law (generally a solicitor
Solicitor
Solicitors are lawyers who traditionally deal with any legal matter including conducting proceedings in courts. In the United Kingdom, a few Australian states and the Republic of Ireland, the legal profession is split between solicitors and barristers , and a lawyer will usually only hold one title...
); one with a background in property valuation generally a qualified surveyor
Surveying
See Also: Public Land Survey SystemSurveying or land surveying is the technique, profession, and science of accurately determining the terrestrial or three-dimensional position of points and the distances and angles between them...
; and a layman
Layman
A layperson or layman is a person who is not an expert in a given field of knowledge. The term originally meant a member of the laity, i.e. a non-clergymen, but over the centuries shifted in definition....
, although some decisions of an LVT may be decided by a single member. LVTs are Non-Departmental Public Bodies
Non-departmental public body
In the United Kingdom, a non-departmental public body —often referred to as a quango—is a classification applied by the Cabinet Office, Treasury, Scottish Government and Northern Ireland Executive to certain types of public bodies...
.
Jurisdiction
They currently determine:- Prices to be paid by tenants compulsorily acquiring either the freehold of houses or lease extensions of flats or collective freehold purchase of flats
- Disputes in relation to service charges
- The appointment of managers and receivers for flats improperly managed
- Findings as to whether a leaseholder is or is not in breach of the terms of his lease
History
Initially created by the Housing Act 1980Housing Act 1980
The Housing Act 1980 was an Act of Parliament passed by the Parliament of the United Kingdom that gave five million council house tenants in England and Wales the Right to Buy their house from their local authority. The Act came into force on the 3 October 1980 and is seen as a defining policy of...
which transferred jurisdiction from the Lands Tribunal (a Superior tribunal of England
England
England is a country that is part of the United Kingdom. It shares land borders with Scotland to the north and Wales to the west; the Irish Sea is to the north west, the Celtic Sea to the south west, with the North Sea to the east and the English Channel to the south separating it from continental...
and Wales
Wales
Wales is a country that is part of the United Kingdom and the island of Great Britain, bordered by England to its east and the Atlantic Ocean and Irish Sea to its west. It has a population of three million, and a total area of 20,779 km²...
), functions have since been expanded by the Leasehold Reform, Housing and Urban Development Act 1993 and the Commonhold and Leasehold Reform Act 2002
Commonhold and Leasehold Reform Act 2002
The Commonhold and Leasehold Reform Act 2002 is an Act of the Parliament of the United Kingdom. It introduced commonholds, a new way of owning land similar to condominiums, into English and Welsh law.-External links:...
.
Lease extension
One of the earliest functions of the LVT was to determine disputes concerning the extension of leases.Historically, when a lease
Lease
A lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
ran out the property held there under would revert to the possession of the landlord/freeholder. In this case, the job of the Leasehold Valuation Tribunal is to hear evidence from both sides as to what the long leasehold value of such a property would be and to determine what proportions of value of the said property should rightfully be ascribed to leaseholder and the freeholder under the legislation. Generally such evidence is given by an expert witness
Expert witness
An expert witness, professional witness or judicial expert is a witness, who by virtue of education, training, skill, or experience, is believed to have expertise and specialised knowledge in a particular subject beyond that of the average person, sufficient that others may officially and legally...
for each side who will argue that a particular value is more applicable based on an analysis of recent sales of comparable properties around the date that the Leasehold Enfranchisement Notice was served.
In many parts of the UK there are substantial freeholders who historically have owned and continue to own large land holdings, and this ownership has been and continues to be passed under leased ownership to sub landlords and leaseholders; this system was particularly suitable when areas of London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
were initially built on greenfield land, and later in the period immediately after the WWII, when considerable renovation and rebuilding was urgently required, the estates were able to effectively sub contract redevelopment to sub landlords, known as head lessors.
The most notable London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
estates are those of the Crown Estate
Crown Estate
In the United Kingdom, the Crown Estate is a property portfolio owned by the Crown. Although still belonging to the monarch and inherent with the accession of the throne, it is no longer the private property of the reigning monarch and cannot be sold by him/her, nor do the revenues from it belong...
, the Duke of Westminster
Duke of Westminster
The title Duke of Westminster was created by Queen Victoria in 1874 and bestowed upon Hugh Grosvenor, 3rd Marquess of Westminster. The current holder of the title is Gerald Grosvenor, 6th Duke of Westminster....
, Earl Cadogan
Earl Cadogan
Earl Cadogan is a title that has been created twice in the Peerage of Great Britain. The Cadogan family descends from Major William Cadogan, a cavalry officer in Oliver Cromwell's army. His son Henry Cadogan was a barrister in Dublin. His eldest son William Cadogan was a noted soldier, politician...
, and Lord Howard de Walden; with the changes in legislation these freeholders are now obliged to sell lease extensions under the various Acts of Parliament which have been passed at prices agreed by negotiation or determined by the Leasehold Valuation Tribunal. Appeals against decisions of the Leasehold Valuation Tribunal are made to the Lands Tribunal.
Composition
Tribunals technically comprise members drawn from one of the five Rent Assessment Panels of England, constituted under Schedule 10 of the Rent Act 1977. Such members also sit on Rent Assessment Committees which determine Fair Rents under s. 70 of the Rent Act 1977, Rent Tribunals under the same Act which determine rents payable under Restricted Contracts (room lettings) and Residential Property Tribunals which were created by the Housing Act 2004.A legally qualified chairman sitting with a Chartered Surveyor
Chartered Surveyor
Chartered Surveyor is the description ofProfessional Members and Fellows of the RICS entitled to use the designation in Commonwealth countries and Ireland...
and a lay member usually constitute the tribunal. However, a small number of chairmen are chartered surveyors and a small number of members of other professions have also been appointed to sit. Chairmen are appointed by the Lord Chancellor
Lord Chancellor
The Lord High Chancellor of Great Britain, or Lord Chancellor, is a senior and important functionary in the government of the United Kingdom. He is the second highest ranking of the Great Officers of State, ranking only after the Lord High Steward. The Lord Chancellor is appointed by the Sovereign...
and other Members by the Secretary of State.