The dark art of right of first refusal notices
Summary
The article explains the practical and legal complexities of serving right of first refusal notices under the Landlord and Tenant Act 1987 when a landlord disposes of a freehold or other relevant interest in a building containing flats. It highlights recent enforcement activity by a local authority and notes that an appeal decision in SGL 1 Ltd v FSV Freeholders Ltd has not fully resolved uncertainty about when an estate or building structure falls within the regime.
Why it matters
Residential property surveyors may encounter these issues in leasehold, mixed-use and estate contexts where the status of a building or common parts affects transaction structure and compliance risk. The article underlines that errors in notice service can have serious legal and criminal consequences, so accurate identification of the relevant property interest is important.
Key points
- Right of first refusal notices are required in certain freehold or relevant-interest disposals involving flats.
- Local authority enforcement appears to be increasing, with potential prosecution for non-compliance.
- The appeal in SGL 1 Ltd v FSV Freeholders Ltd offered limited clarity on what constitutes a building for these purposes.
- The landlord may decide which common parts of an estate are included in the disposal.
- The article notes that government reform focus is elsewhere, including commonhold and new leasehold flat restrictions.
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