We are currently not accepting instructions in respect of the conveyancing of Foundry Lea Estate, Bridport, due to concerns, particularly regarding the service charge provisions, adoption and maintenance of roads and bridges, and other elements of the transfer document.
Nantes have extensive experience in the purchase of new build developments, and we are trying to avoid a repeat of a previous situation whereby the service charge increased from £19.30 per month in 2021/2022 to £32.75 per month in 2025. It was only a service charge strike by the house owners that forced a handover of the control of the management company to them, and the sacking of the managing agent installed by the developer.
This firm does not want to see the same happen at Foundry Lea.
Service Charge
The main problem is the service charge (“S/C”). According to the terms of the Plot Transfer to each owner, the S/C starts straight away, even though there are no realistic common areas to enjoy for the owners. It will take some time before they are built, and there will be no need for any reserve fund to be built up for the future (except for the flats, of course). The initial annual budget includes £98,700 for “landscape maintenance” and £45,600 for the “management fee”, yet there is very little to manage and very little to maintain in the short term.
In an email to Nantes dated 19th May, it was confirmed that, apart from an initial payment, no service charges would be collected until the site had been completed and handed over to the management company. The guidance document states that control of the management company will be handed over to the property owners, and ownership of the common parts will be handed over to the management company once all of the houses and flats have been sold. However, neither of these assurances is in the contract or the transfer, which the developers have refused to amend, so that the promises they are making in correspondence are not binding.
Clause 10.3 of their contract requires all new terms to be in the contract, and anything that is merely in correspondence, even between lawyers, will not be binding.
River Bridges (Section 38 Highways Act)
The documentation suggests that the estate roads and river bridges will have the benefit of a s38 Highways Act agreement, but there is no obligation to enter into one. A section 38 agreement is a guarantee from Dorset Council that the roads and river bridges will be built to adoption standards and that the Council will take over their long-term maintenance. It has been explained to Nantes that the developers have no intention of entering into such an agreement until the estate has been completed, which could be in 15 years’ time. That means that if the developers are not in existence during that period, the roads and river bridges will need to be maintained out of the service charge. That is likely to be unacceptable to many mortgage lenders, causing problems with the initial purchase or resale. It is the river bridges that are of particular concern.
We have asked the developers if it would be feasible to at least enter into an S38 to include the river crossing bridges and the major estate roads, just leaving the spur roads to be adopted at the end of the build, and await their response.
There are various other issues in the transfer that we think need to be corrected, in particular amendments to the cumbersome and expensive sale transfer procedure, which Bridport will be stuck with forever, and a restrictive covenant relating to the keeping of vans; however, the developers are currently refusing a dialogue on the terms of the transfer.
Nantes remains available to continue a dialogue with the developers, and we have put our concerns in writing to them. For the moment, and in the best interests of our clients, we have decided, for the time being, not to act for any buyers, in the hope that we can resolve the issues set out above.
Solicitors in Bridport, Dorchester, Portland & Weymouth
Why Choose Nantes Solictors
Choose Nantes Solicitors for your legal needs in Dorset and benefit from our reputable law business. With a history extending back to the 1800s, we have established ourselves as a leading authority in the region, famous for our legal knowledge and great client service.
We can customise solutions to our clients thanks to our considerable business and local experience. With offices in Bridport, Dorchester, Weymouth, and Portland, we are easily accessible throughout the region.
Each department at Nantes Solicitors is overseen by an experienced Director, ensuring competence and insight in every case. We simplify difficult legal issues with our forward-thinking guidance.
We prioritise your objectives, actively listening and collaborating with you to obtain the desired results. Our expert solicitors deal with any concerns that arise and provide thorough help throughout the procedure.
Nantes Solicitors is known for its legal quality, local knowledge, convenient locations, forward-thinking approach, and uncompromising dedication to customer satisfaction. We are your reliable legal partner in Dorset, ready to help you with all of your legal needs.
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