What are the Changes? 

The Act includes a number of new measures to strengthen and protect prospective and existing homeowners, including:

• Banning the sale of new leasehold houses, except in exceptional circumstances.
• Making it cheaper and easier to extend leases (including removing the two-year ownership requirement before leaseholders can exercise their statutory rights to lease extension) or buy freeholds.
• Increasing the standard lease extension term to 990 years for houses and flats (up from 50 years for houses and 90 years for flats).
• Abolition of ‘marriage value’ for leases of less than 80 years. Marriage value is the increase in the value of the property following the completion of a lease extension (reflecting the additional market value of the longer lease).
• Enhancing transparency over service charges by requiring freeholders or managing agents to issue standardised bills.
• Simplifying and reducing the cost for leaseholders to manage their buildings and appoint their preferred managing agents.
• Removing the obligation for leaseholders to cover freeholders’ costs when exercising enfranchisement rights.
• Expanding access to redress schemes for leaseholders to challenge poor practices. Freeholders who manage directly will now be required to belong to a redress scheme, as managing agents already are.
• Accelerating and simplifying the buying or selling of leasehold properties by setting maximum times and fees for necessary information.

What’s not Covered?

The general election and subsequent change of government in July 2024 has, to some degree, interfered with the passage of the Act. Many commentators were expecting a cap on ground rent and a ban on the forfeiture of long residential leases, but this is not included. However, with implementation of the Act not expected until 2025 or even 2026, there may be further changes ahead.

If you have any questions regarding the Act and the proposed changes, our property department is on hand to assist you.

Trustee meetings are an important way for trustees to come together and make decisions about the charity collectively. However, in order for decisions made at a meeting to be valid, the meeting must be held in accordance with the charity’s governing document. This is especially important in a post COVID era where many charities choose to hold their meetings online. Unless your charity’s governing document expressly permits meetings to be held electronically, decisions made at an online meeting will not be valid.

What should you do? 

Firstly, you should certainly double check your charity’s governing document for the charity’s rules about meetings. It is essential that a charity follows the concept of holding a valid meeting, complying with any specific requirements in your charity’s governing document and ensuring that everyone at the meeting can see and hear each other.

Secondly, consider the methods your charity currently uses and would like to use to hold meetings.

There are three ways which your charity can hold meetings.

• a traditional face-to-face meeting.
• a virtual meeting where everyone joins the meeting electronically (i.e. Teams or Zooms etc).
• a “hybrid meeting” where some people meet face to face whilst others join the meeting virtually.

If you want to hold virtual and hybrid meetings, the Charity Commission requires an express power to hold electronic meetings in your charity’s governing document.

Your governing document should include:

• Whether all your charity meetings could be virtual or hybrid
• How you give notice of virtual and hybrid meetings
• How you will hold votes at virtual and hybrid meetings
• How you may adjourn virtual and hybrid meetings

Further, the Charity Commission recommends that the governing document include how people can ask questions, join in the debate and finally, what would happen to the meeting if there were technical problems if the charity chooses to hold meetings virtually.

If your charity’s current governing document does not include any provisions about charity meetings, or  does not include the power to hold electronic meetings, then we strongly recommend that you seek to amend your governing document.

This is something our Charity Department can certainly help with, so please do not hesitate to get in touch today or if you have any general questions on the Charity Commission’s recent update.

Will Disputes

The recent Central London County Court judgement in Langley v (1) Qin & (2) Shi is a prominent case which highlights the risks of predatory marriage and undue influence.

The key facts of the case were that Robert Harrington (“the Deceased”), died in May 2020, aged 94 years old. In June 2019 (just eleven months earlier), the Deceased married his “carer”, Guixiang Qin (“the First Defendant”), when he was 93 years old, and the First Defendant was 54 years old.

The Deceased was pre-deceased by his first wife, Eileen Harrington, who died in January 2018, after 66 years of marriage. They had a single child, Jill Langley (nee Harrington) (“the Claimant”).

The Deceased’s will dated 24 March 2020 (“the Will”) is one of the key subject matters of this claim. The Will names the First Defendant as the sole beneficiary and executrix, and the First Defendant’s adult son, Mr Zhibin Shi (“the Second Defendant”) from her earlier marriage in China, in her place.

The Claimant brought proceedings against the Deceased’s estate on the grounds that:

• the First Defendant and the Deceased’s marriage was a predatory marriage;
• undue influence was exerted on the Deceased by the First Defendant to leave his entire estate to her; and
• the Deceased lacked testamentary capacity when making his Will.

The Claimant was successful in proving undue influence, and that the Defendants did not discharge the burden on them to establish that the Deceased did know and approve the content of the Will. Accordingly the Will was set aside, and the Claimant therefore also succeeded on costs against the First Defendant. This meant that the Deceased died intestate, as his previous wills dated 10 June 1997 and 4 May 2012, were revoked by the marriage to the First Defendant. Under the rules of intestacy, the First Defendant, being the Deceased’s wife, would receive a lump sum of £270,000 together with half of the residue of the Deceased’s Estate. Evidently, the automatic revocation of a will by a later marriage can still cause lasting problems for families. Fundamentally, however, this case raises a deeper concern over predatory marriage, which the court did not make specific findings about.

Predatory marriage is a topical issue since there is currently no law in place which prevents the emotional and financial burden placed on the victims. In essence, a predatory marriage occurs where one party coerces and grooms the other party (who is often, more vulnerable) into marriage, in order to (usually) secure financial gains.

Further litigation is expected to follow since it was discovered at trial that the First Defendant may have already benefited by £230,000 from the Deceased’s bank accounts up to the Deceased’s death.

With the unfortunate ever-rising issues of predatory marriage, challenges to testamentary capacity and undue influences coupled with the current rule of automatic revocation of wills upon marriage, disputes are likely to arise.

The Dispute Resolution Department at PWW can certainly help navigate around these sensitive topics so please feel free to contact them today.

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Below we summarise the key changes that came into effect in March:

Changes to Governing Documents

Charity Trustees of unincorporated charities (i.e. trusts and unincorporated associations) have been granted new statutory powers to amend their governing documents [s.280A Charities Act 2011]. Now charity trustees can amend their governing documents by passing a trustee resolution with a 75% majority. If the charity has a wider membership, a members resolution passed by a 75% majority is required in addition to a trustee resolution passed by a simple majority.

If charity trustees wish to make a “regulated alteration” (e.g. change of name, change of objects etc) to their governing document, the Commission’s consent will be required in the same way it is for charitable companies and CIOs. Any regulated alteration will only become effective upon registration by the Commission.

The Charity Commission are now obliged to apply a new statutory test when considering any application to amend a charity’s objects. The new statutory test requires the Commission to have regard to:

• The existing objects of the charity;
• The desirability for new objects (so far as seasonably practicable) to be similar to the existing objects of the charity; and
• The need for the charity to have suitable and effective objects, in light of current social and economic circumstances.

Disposals of Land

Dispositions of charity land made by a liquidator, receiver, mortgagee or administrator are now exempt from the usual Charities Act 2011 disposal rules.

Charity trustees are no longer required to certify compliance with the Charities Act 2011 when disposing of charity land. Instead, statutory statements are required to be included in both contract and transfer documents.

The Charities Act 2022 seeks to clarify that transfers to another charity, which further the objects of the transferring charity, are exempt from the usual Charities Act 2011 disposal rules. However, transfers to another charity for financial gain (or social investment) will still be covered by the usual disposal rules.

Charity Mergers

New provisions implemented by the Charities Act 2022 will enable more gifts made to a former charity which has merged with another charity to have effect as if it were a gift to the new charity.

Charity Commission Powers

The Charities Act 2022 has also granted the Commission new powers to authorise trustee payments for work performed for the charity in situations where withholding such a payment would be inequitable. The Commission is also now authorised to confirm defective or potentially defective trustee appointments and the decisions made by such a trustee.

The Commission’s powers to require public notice of changes to a charity has been broadened to include changes to a governing document as well as orders made by the Commission. The requirement for public notice is at the Commission’s discretion.

If you have any queries about how these changes might affect your charity please feel free to contact our Church and Charities team at PWW who would be happy to answer any queries you might have.

Property owners, both residential and commercial, should be aware that there is a bill being considered by Parliament, the Minimum Energy Performance of Buildings (No. 2) Bill (the “Bill), that seeks to increase the minimum energy efficiency standards for all buildings in England and Wales.

Introduced in 2007, an Energy Performance Certificate, typically referred to as an ‘EPC’, is a certificate which provides property owners with details of a property’s energy efficiency, graded from ‘A’ (most efficient) to ‘G’ (least efficient). If implemented, the new Bill (which is currently on a second reading in Parliament) would make it illegal for domestic rental properties in England and Wales rated below Band ‘C’ to be let to tenants. For new tenancies, the requirement would take effect from 31 December 2025; for existing tenancies, the deadline would be 31 December 2028. Owner-occupied properties must achieve Band ‘C’ by 2035, whilst all rented non-domestic properties must achieve Band ‘B’ by 2030.

The new measures are part of a government drive to improve the energy efficiency of buildings, combat waste and reduce carbon emissions. In 2018, regulations were introduced that made it illegal to rent out a residential property with an EPC rating of less than ‘E’. The same regulations became applicable to domestic owner-occupied properties in 2020. The new Bill will increase this minimum standard even further as part of the sector-wide movement towards more energy efficient buildings, and there will be fines for failure to comply.

The challenge facing many landlords and property owners is, where their buildings have an EPC rating of less than ‘C’, what improvements they ought to be making to meet these new minimum standards. EPCs are issued with recommendation reports which give property owners details of improvements that can be made to increase its energy performance, for example, by installing insulation, replacing single glazed windows or switching to low energy lighting, so that is a good place to start.

Many landlords and property owners will however be just as concerned with the overall cost of implementing these improvements as they will with the improvements themselves. The Bill includes certain exemptions, and caps on the cost of making improvements, but it remains to be seen whether such protection wording remains in the Bill as it makes its way through Parliament.

If you are a landlord or homeowner, and you would like to speak to a legal specialist about the energy efficiency of your property, please contact our Property team today.

Under the Administration of Estates Act 1925, an executor has a legal obligation to access, value and administer the assets of a deceased estate. In practice, this means that the executor is responsible for taking care of all the physical assets of the estate during the process. But it is more of a sticky situation in relation to digital assets.

Digital assets are not currently defined in English law, but can include assets such as social media accounts, photographs stored in the iCloud on a computer, cryptocurrency e.g. Bitcoin), bank accounts, medical records, digital music libraries etc.

Theoretically digital assets should be treated like any other form of property. However, there are key notable differences. Unlike more traditional assets, there is often no physical documentation that proves the deceased’s ownership of the digital data and it becomes necessary to access the deceased’s online accounts in order to prove ownership.

Before any executors consider accessing a deceased’s digital devices, they should draw their attention to the Computer Misuse Act 1990 (“the Act”). Currently, the Act makes it a criminal offence (a fine or an imprisonment for a term not exceeding two years or both) for anyone to gain unauthorised access to any computer device, and this includes using another person’s password without their permission or prior authorisation. Undoubtedly, this poses an obstacle for personal representatives or executors to distribute any digital assets in accordance with the deceased’s wishes.

A further significant issue which executors should consider when faced with digital devices on death is that many online service providers have their own terms and conditions dictating what happens when a user dies. There are different rules for different digital providers and a prudent executor should check first before determining whether access on behalf of the deceased is permitted.

We have recently encountered issues with executors gaining access to a deceased’s devices. It is important to note that organisations such as Facebook and Apple have systems in place for bequeathing digital assets. For instance, Apple’s (current) privacy agreement is that it only allows access to data, photographs and notes stored in its iCloud to a named legacy contact. According to Apple, this implementation strongly protects account holders’ data from falling into the wrong hands. As a result, this could mean that it is impossible to unlock an Apple device without the log in ID and password even if executors make a request to Apple with a court order, such as a Grant of Probate.

The Law Commission has recently acknowledged the challenges posed by accessing a deceased’s digital assets and consequently, reforms such as Digital Devices (Access for Next of Kin) Bill (“the Bill”) are currently underway. The aim of the Bill is to allow authorised individuals, such as executors or personal representatives, to access the digital devices of the deceased more easily and also creates exceptions to the Act. However, the Bill is still only on its second reading in Parliament so is not law yet.

Overall, an executor’s right to access the deceased’s electronic devices still remains very much a grey area. Moreover, as a person making their own will, the issue of digital devices is here to stay yet remains a tricky area. If you find yourself faced with this situation, you should seek specialist legal advice first, before proceeding.

As legal practitioners, we are certainly able to help by providing advice. Please contact our Private Client Department today.

The charities team at PWW is proud to be ranked in the Legal 500 and Chambers again this year.

We would therefore like to take this opportunity to thank all our clients that contributed to the process for their fantastic feedback and continued support. The excellent testimonies received from both new and established clients has ensured our listing in these prestigious legal directories, which recognises the best law firms across the country.

Our rankings on Legal 500 and Chambers are a testament to the charity team’s professionalism and commitment, which continues to assist clients with identifying the right advisors for each organisation or individual’s needs and offers cost-effective legal advice on a broad spectrum of governance and property issues.

Small charities are the lifeblood of local communities. Every year small charities work tirelessly for the public benefit with little recognition or appreciation. That’s why PWW is proud to support Small Charity Week 2023 #SmallCharityWeek #SmallCharitiesTogether

At PWW we specialise in providing legal advice and assistance to small charities, from incorporation, through the highs and lows of running a charity to a charity’s closure. Each June we help to raise awareness of small charities in the UK so that they get the recognition and appreciation they deserve.

With the ongoing cost of living crisis it has never been a more important time to support small charities and that’s why we support Small Charity Week 2023 #SmallCharityWeek.

Visit www.smallcharityweek.com to find out more about the free events designed with small charities in mind #SmallCharityWeek.

For legal assistance during small charities week and beyond please contact us or call on 0207 821 8211 for an initial consultation with one of our small charity experts.

The key provisions of this new phase came into force on 14 June 2023 and are intended to simplify property transactions for charities.

Under the Charities Act 2011, when disposing of charity property, trustees were required to obtain and consider a report by a RICS qualified surveyor that the terms of the transaction are the best that can be reasonably obtained for the charity. This overall process has not changed under the Charities Act 2022, but there are some new provisions aimed at simplifying it:

• Whereas under the Charities Act 2011 trustees had to get advice from a RICS qualified surveyor they now have the option of obtaining a pre-disposal report from a “designated adviser”. This means that suitably experienced charity trustees, officers and employees will also be able to provide a report or advice on the proposed disposition, in addition to RICS qualified surveyors and estate agents.

• The old regulations governing what information a pre-disposal report must contain have been revoked. A new set of regulations, the Charities (Dispositions of Land: Designated Advisers and Reports) Regulations 2023 are now in force instead. The new regulations simplify the information that should be included in a pre-disposal report, which should help ease the decision-making process for trustees.

• Trustees will no longer have to advertise a proposed disposal of land in such manner as their surveyor advises. This gives trustees some more flexibility over how they choose to dispose of their property. For example, when selling, they could put the property into auction, or sell to a third party without having to advertise it for sale on the open market.

These are welcome changes. Charities now have more choice over who they take their advice from, and the likelihood is that the new regulations will cut down on the administrative costs charities face when disposing of land. In addition the new regulations governing pre-disposal reports replace a set of regulations that are now thirty years old and no longer fit for purpose.

If you are a charity and require further legal advice on land disposal in England and Wales, please get in touch for expert advice and guidance on land disposal transactions.

The Legal Ombudsman’s rules for making a complaint about legal services changed on 1 April 2023.

There are four areas that are effected, which are as follows:

• A change to time limits.
• Discretion to decline to issue a formal Ombudsman decision after an investigator case decision if neither party raises any substantive objection to the findings.
• Changes to the Ombudsman discretion to dismiss or discontinue a complaint in certain circumstances.
• Minor drafting changes to update Scheme Rules including new dates and correcting previous typographical drafting errors.

The most significant change for clients is the change to the time limits for referring a complaint to the Legal Ombudsman. The previous six year limit has been reduced and is now no later than one year from the date of the act or omission being complained about or one year from the date a client becomes aware that there is cause for complaint.

The Legal Ombudsman will retain the ability to exercise discretion to extend the one year time limit for specific clients if, on the evidence, it is fair and reasonable to do so.

More detailed information about the changes can be found in The Legal Ombudsman’s Consumer guidance on Scheme Rules changes publication.