My SO Home: No. 29

Today I staircased to 100%. But I had to go to court to do it. This is my story.

In 2016 I paid £145,000 for a 50% share in my shared ownership flat. It was originally marketed at £125,000 but, following construction delays, the housing association increased the price. I heard that some buyers had to pull out as the price increase meant they no longer met affordability criteria, but I was able to proceed.

Then, five years later, in early 2021, I decided to purchase the remaining 50% share.

Building safety remediation and staircasing

At the time my block was undergoing building safety remediation works. In order to obtain a fair valuation, I contacted my landlord, Estuary Housing Association, to establish costings and liability for remediation works between September 2020 and March 2022. I spent 18 months asking Estuary if leaseholders would be liable for those costs, but they refused to give a definitive answer.

“You will appreciate that Estuary could not unequivocally state that no charge would be made, as the legal position and legislation around fire safety remedial works was at the time of the survey in March evolving and the position still remains very dynamic.” (Estuary Housing Association)

In May 2021, I emailed the Greater London Authority (GLA) to see if they could intervene and compel Estuary to provide me with an estimate of costs. They refused.

Estuary Housing Association challenge my RICS valuation

Finally, in 2022, I gave up and just went ahead with staircasing. Estuary’s policy is to ask the shared owner to apply to a valuer on their behalf. They asked me to get a RICS valuation, and I did. I noticed that Estuary’s staircasing documentation seemed to indicate they had a right to object to a valuation. Consequently I wrote to them to query this. They responded that this wasn’t in the lease, but was their procedure.

“It is not within the lease. However, if Estuary do not agree with your valuation and have evidence to back this up, we will dispute the valuation. This is our procedure.“ (Estuary Housing Association)

As they had confirmed to me that they had no right under the lease to object to my valuation, I proceeded with staircasing and instructed a RICS valuer.

The firm sent me an initial valuation report to review. I made several comments, including to correct the valuer’s misunderstanding that remediation works only included cladding replacement. I also provided a Freedom of Information request which showed funding Estuary had already received for cladding replacement. The valuer requested my view on the initial report in respect of costs of the remediation works that were ongoing. Given Estuary hadn’t responded to my requests for information about leaseholders’ liabilities, I provided an ‘educated guess’.

Could Estuary Housing Association refuse to allow me to staircase?

I received the final version of the valuation report in April 2022, and submitted this to Estuary. But, on receiving my valuation, they ceased all communication with me despite my making formal complaints about their inaction.

In a series of internal emails Estuary Housing Association staff say:

“We have no obligation to sell if we do not wish to.”

“We do not wish to sell at a loss”.

“I think our response should be that we are unwilling to sell at the moment while we are resolving the safety issues. There is no compulsion on us to sell is there?”

“We do not want to sell to anyone at the moment. We have no obligation to sell (as far as I am aware) so why would we sell at a discounted rate? I thought that I had made this clear.”

In early July, Estuary contacted me to state that the valuation was too low, that they wanted a new valuation, and would not allow me to staircase with my RICS valuation. Their representative told me that they would go to the District Valuer Service for a new valuation, per the lease. My response… Estuary was breaking the lease, and I would be compelled to take legal action. In email correspondence between Estuary and the GLA, my housing association admitted that their refusal to let me staircase had no foundation in the lease.

“Simply the lease provides for the shared owner to staircase and Estuary has no right to refuse.“ (Estuary Housing Association)

Taking legal action

I proceeded to court in July 2022.

Prior to the trial date – in 2024 – Estuary’s solicitors, Devonshires, sent me a letter in which they urged me to discontinue my claim. They stated that, if I lost the case, I could be liable for Estuary’s legal costs – which they estimated could be as much as £56,000 + VAT. The firm stated that, in this eventuality, I would be given 14 days to pay legal costs in full. Otherwise, enforcement measures could mean:

(a) I wouldn’t be able to sell my home without first discharging the debt, or

(b) my employer would be compelled to pay the debt from my wages, or

(c) my bank could be obliged to pay the debt from my bank account.

Fortunately, I finally won my case on 22 November 2024.

(At the time I was spending some time in Ireland as my aunt was terminally ill. I agonised over whether or not to come back for the trial, but decided I owed it to myself to see the case through.)

The ruling

In their initial defence, Estuary said: “We acknowledge Mr Doran’s claim but challenge the basis of the valuation of the property, as it should have been on a ‘shared ownership’ basis rather than a ‘full’ basis.” They subsequently changed their defence to argue:

• the RICS valuation was not carried out in accordance with the terms of the lease, and
• it gave inappropriate weight to the assumption that leaseholders would be liable for ongoing building safety costs in respect of a failed EWS1 inspection.

However, Deputy District Judge Boon disagreed. Her view was that a statement made by Estuary – “It is unlikely that any costs will be passed to leaseholders” – did not constitute a cast-iron guarantee that leaseholders would not be liable for costs. (It was not confirmed that no leaseholder would have to pay until after my RICS valuation report had been obtained).

She concluded that: “the valuation of £200,000 is binding on both parties”. Estuary had to allow me to purchase the remaining 50% for £100,000: “in accordance with the staircasing provisions of the lease and the valuation of £200,000 by 22 February 2025”.

Deputy District Judge Boon also ordered that Estuary should repay the rent I’d paid while I was prevented from staircasing (£13,661.71), and my legal costs (£7,250).

Unfortunately, my relief was short lived. I have just discovered that my EWS1 form was signed off by Adam Kiziak, a fire engineer who is currently under investigation for potential malpractice and forging signatures. Per my solicitor, this could make my flat unsellable. I decided to proceed anyway and am hoping for the best.

Additional Resources

HomeOwners Alliance: Shared ownership staircasing explained

Shared Ownership Resources: Can I challenge a staircasing valuation?