Tenants Win Right to Acquire Subsoil and Airspace in Guideline Case

Qualifying apartment dwellers have a right to acquire the freehold of the buildings where they live, but does that extend to the subsoil beneath the premises and the airspace above? The Court of Appeal addressed that critical issue in a guideline decision.

The case concerned a purpose-built block of 45 flats, the tenants of which sought to exercise their right to acquire the property's freehold under the Leasehold Reform, Housing and Urban Development Act 1993.

A stumbling block in their path, however, was that third parties had acquired leasehold interests in respect of most of the building's basement, the subsoil beneath the whole premises and the airspace above it to a height of seven metres.

An issue thus arose as to whether the tenants' entitlement to acquire the building's freehold extended to a right to acquire those leasehold interests. In a ruling that was subsequently affirmed by the Upper Tribunal, the First-tier Tribunal answered that question in the affirmative.

In dismissing the leaseholders' challenge to that outcome, the Court noted the general rule that, once constructed, a building becomes part and parcel of the land on which it stands. The same applies to the airspace above the built structure.

The Court found that the rights and premises demised by the leases formed part of the building and that to prevent the tenants acquiring the leasehold interests would produce a result that was undesirable and impracticable, if not actually absurd. They would in effect  be left with only the filling to the sandwich, without the airspace and subsoil which formed its two outer slices.

The basement, subsoil and airspace were properly viewed as common parts of the building. It was reasonably necessary for the tenants to acquire all of those parts in order to enable proper maintenance and management of the roof space and basement, in which common facilities were located.