: Lease and trustees  ( 695 )

dimogga

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Lease and trustees
« : February 05, 2015, 10:53:57 AM »
We're nearly at the point where we can sign a lease. We need four trustees.

The info from the federation says:

OBLIGATIONS OF TRUSTEES – ALLOTMENT ASSOCIATION

The following are some of the basic responsibilities of Trustees when they agree to act as such for their Allotment Association and when the Allotment Association has taken a lease from the local authority.

Although the following responsibilities are for general information it is not by any means an exhaustive list and any person considering taking on the duties of a trustee is advised to take independent legal advice before agreeing to do so.

A Trustee has the duty to

hold the land leased to their allotment association on behalf of the Allotment Association for the term of the lease
ensure that all rent due for the lease of the land is paid to the local authority
produce any accounts that need to seen by the local authority
pay water rates
be responsible for looking after all monies collected from members
be responsible for the management of the land leased to the Allotment Association
ensure that all covenants in the lease are duly observed and performed
be aware that any legal action taken out against the Allotment Association will be in the name of the trustees




So who do we get independent legal advice from?
I've emailed a solicitors who have said its £500+VAT to review the lease and create a full and detailed report and then she says as we are considering a trust it'll be £500+VAT for trust advice..

I've emailed the FED to ask for the details of the solicitors who have been dealing with the council lease for every other site but he's just sent me back the info again. Is it cos they will not be independent?




Big Gee

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Re: Lease and trustees
« #1 : February 05, 2015, 12:59:35 PM »
Hmmm - not sure about the 'independent' bit. Solicitors fees is the reason I sat down for days on end slaving with our CIO constitution.

Are you a members of the N.S.A.G.? If so then they have a legal department that gives legal advice for free to members if I remember correctly.

Here's their URL:

http://www.nsalg.org.uk/[/size]]http://www.nsalg.org.uk/
 

dimogga

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Re: Lease and trustees
« #2 : February 05, 2015, 01:21:05 PM »
Not members - and it's only the initial bit of advice given free - so it's not going to cover very much reading time even.

I don't understand whether we're just holding trustees - I think we are - but I've read that even holding trustees can be sued.
There's nothing in the lease that says trustees have any rights to control the way the group is run - which backs up the holding trustee idea... but the thing the federation bloke sent out says

OBLIGATIONS OF TRUSTEES – ALLOTMENT ASSOCIATION

The following are some of the basic responsibilities of Trustees when they agree to act as such for their Allotment Association and when the Allotment Association has taken a lease from the local authority.

Although the following responsibilities are for general information it is not by any means an exhaustive list and any person considering taking on the duties of a trustee is advised to take independent legal advice before agreeing to do so.

A Trustee has the duty to

hold the land leased to their allotment association on behalf of the Allotment Association for the term of the lease
ensure that all rent due for the lease of the land is paid to the local authority
produce any accounts that need to seen by the local authority
pay water rates
be responsible for looking after all monies collected from members
be responsible for the management of the land leased to the Allotment Association
ensure that all covenants in the lease are duly observed and performed
be aware that any legal action taken out against the Allotment Association will be in the name of the trustees



Big Gee

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Re: Lease and trustees
« #3 : February 05, 2015, 07:16:49 PM »
I'm not qualified to give you proper legal advice Di, but it seems that basically what it boils down to is that they are lining up the ducks should something go pear-shaped.

A Charitable Incorporated Organisation guards agains that, because the 'charitity' has the same protection as a limited company, so the trustees are not responsible for the debts of the 'charity' and if there is any suing to be done the 'charity' itself is responsible because it's a legal body corporate i.e. it has it's own personage.

I would investigate that option if I were you.
 

dimogga

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Re: Lease and trustees
« #4 : February 06, 2015, 08:53:54 AM »
There's nothing in the lease saying the trustees should manage the allotment. That's down to the committee. So the trustees have no rights to tell the committee what to do, or how to run the right. So I think that makes them holding trustees only.
I've looked into insurance we could all be listed as named persons on the insurance to be covered. Although you only find out how good insurance is when you find out how bad it is.

I need to find four people at our meeting next week willing to at least think about being named as trustees. If we can't then we'll have to look at the CIO option (or even ltd company which would be easier) and that can hold the land for us instead.  And then find the people willing to do that too.

It'd have been easier if the fed had done the ltd company and had all sites leased through them. They've been working on this longer than we've had our allotment - and their leases all started when they started that process so are going to have 20 years left to run not the full 25 we will have.

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Re: Lease and trustees
« #5 : February 06, 2015, 10:57:45 AM »
The big advantage of having a CIO over a limited company is that it unlocks the doors to resources available for registered charities (like the Big Lottery Fund - as an example), but with all the attributes of a ltd. company when it comes to personal liabilities.

Ltd. companies have to have Memorandums & Articles, like a CIO has to have a governing document (constitution), and like a CIO a ltd. company can have custom mems & arts specifically written up for an individual company that suits it's activities, r you can make do with an 'off the shelf' company with basic bog standard mems & arts, likewise you can write your own constitution (as I have - and you're welcome to use that for your purposes) or you can choose between one of two 'off the shelf' governing documents that the Charities Commission provides for CIOs. There is more involved in end of year accounts for a ltd company than the returns you need to submit to the Charities Commission annually.

Also there is the tax relief aspect to consider, contributors to charities can have their donations written off against their own taxes and you don't need to worry about HMRC corporate tax returns for a charity. Plus the fact you have trustees and not directors. Ltd. companies are really designed for businesses that have profits and turnover, charities are far easier and are designed for the purpose of providing services to the public - which is exactly what you do with allotment groups and the sites they manage for the benefit of the public. And finally you have to pay to register a limited company at Companies House, registration of a CIO with the Charities Commission is free.

I would definately do a bit of homework before you start inviting trustees into something you have there which seems a bit hazy at the moment.
 

dimogga

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Re: Lease and trustees
« #6 : February 06, 2015, 11:05:36 AM »
All the other allotment groups are (have) signed their leases with people as trustees. They're all long established groups without maybe the concerns of our slightly trouble group at the moment.
I emailed the secretaries out and only responses I got were that none had looked into independent legal advice for being trustees.

I take your point of the advantages of the CIO!
That would have to be approved by the council too and the separate bit that manages stuff like that/ (Where lots of the delays have come from)

I was told none of the leases were being 'stamped' at the land registry until they were all done, but I think ours is outside of that so we're holding no one else up.

The fed man has asked me where my D pack is and as I have no idea what that is I've emailed back saying so.
It's all really far more complicated than growing carrots.






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Re: Lease and trustees
« #7 : February 06, 2015, 11:24:57 AM »
Bureaucracy reigns supreme in our modern world Di! How is the Land Registry involved in your set-up?

However, having had a moan about bureaucracy,  I'm a great advocate of getting the 'papers' in order right at the start - before you start growing carrots! Without doubt the biggest problem by far (especially amongst the older long established allotment groups that were set up over a century ago & the new - privately run & very naive new sites set up by inexperienced people) is a lack of a proper constitution document and proper tenancy agreements. Get those two sorted and 99% of all the problem solving when things go pear shaped are resolved in advance, otherwise it can become a pig's breakfast with permanent problem solving that drags everyone down, after all the objective is to grow carrots, but in a peaceful and harmonious environment. A sloppily run site with vague (or no) rules and nothing signed is a recipe for disaster.
 

dimogga

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Re: Lease and trustees
« #8 : February 06, 2015, 11:31:58 AM »
Because we are signing a lease for the land.

The idea is we will be self-managed (We sort of are now, but we were only formed as an allotment site after all the other allotment sites started the process for self-management, so we've not known anything else.)
The idea for making allotments go self-managed was to relieve the cost burden on the council for repairs - so we have to hold the leases for the land.

The lease is signed by four trustees and then the council and then gets registered at the Land Registry to show that we are the leaseholders.



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Re: Lease and trustees
« #9 : February 06, 2015, 12:04:47 PM »
Because we are signing a lease for the land.

The idea is we will be self-managed (We sort of are now, but we were only formed as an allotment site after all the other allotment sites started the process for self-management, so we've not known anything else.)
The idea for making allotments go self-managed was to relieve the cost burden on the council for repairs - so we have to hold the leases for the land.

The lease is signed by four trustees and then the council and then gets registered at the Land Registry to show that we are the leaseholders.

Ah - right, that makes sense now!

It helps them escape their responsibilities and very conveniently lets them dodge their statutory obligations under the Smallholdings and Allotments Act 1908. Especially as a bit of pressure is being brought on local authorities these days to provide more land, especially here in Wales, where the Welsh government is about to bring out separate legislation to stiffen up the existing powers of the UK wide allotments act with this new Welsh legislation putting  further pressure on local authorities to provide more land for plots but within a stipulated set time frame (councils now often use the huge loophole in the current act - where there is an obligation placed on them to provide allotments, but no time scale stipulated, so if they wish they can drag their feet until kingdom come). So what do they do? Make their sites self managed and give the allotment groups a business lease which is governed by totally different guidelines in law. And consequently they neatly wash their hands of the problem caused for them. It's also a neat time for them to do this because the standard excuse for any inactivity or the dodging of work by councils is now the local government cuts - it's an excuse for all ails. It doesn't stop them paying their chief executives hundreds of thousands of pounds in salaries though - or give their managers wage rises whilst capping all the lower worker's wages. Parasitic self centred toe rags in my opinion, with a few exceptions, where some councils take their responsibilities for allotments seriously.
 

dimogga

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Re: Lease and trustees
« #10 : February 06, 2015, 12:15:05 PM »
25 year leases give 25 years security of it being allotments though.
And it means the rents are managed by the federation rather than the council.

They're the two biggest gripes of allotmenters aren't they? Land under threat and rents going up.

It does mean though that if we need a new fence it's got to be paid for our of our funds - or from fundraising or grants. We are lucky that we get on very well with our local councillors and they are very supportive.

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Re: Lease and trustees
« #11 : February 06, 2015, 03:12:21 PM »
Good points, but under the provisions of the 1908 Allotments Act, any council who takes away land that has been allocated for allotment use by them must be replaced by suitable like for like land in the same locality. Their rents are also supposed to be 'fair & affordable' so to a point it's partly regulated by statute. 'Self managed' sites where the rent is set by the 'management' has no similar constraints. Also you'll probably find that the lease from the council will contain a lease payment review clause, so every stipulated few years the cost of the lease may be reviewed with an upwards only clause.

By leasing out the land & ducking their direct obligations to maintain a site by dodging their statutory obligations, they can in theory at the end of the lease period dispose of the land to developers - without the need to provide anything else instead. 25 years - in the big picture of things - is a VERY short period. We're not talking about a 99 or 999 year leases here! It's not even one generation of use. The devil is often in the detail. I believe it's a devious way of eroding the availability of land for allotment use in the future, and the shaking off of the constraints of their obligations through the said act. I also believe it's the process of circumnavigating their problem by stealth, divorcing themselves from the need to provide allotments, and eventiually divorcing growers from access to the soil. Quite clever really.


 

dimogga

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Re: Lease and trustees
« #12 : February 06, 2015, 03:22:03 PM »
The rent is a peppercorn for the 25 years.
I agree a 99 year lease or even a 999 year lease would be better.

The rents will be affordable - it's up to the fed to set that level. The fed is made up of all the allotments in Oldham (Well all the council ones, there are some private ones who are out there too) and secretaries and chairs make up the meetings. They get 5% of the rents levied. Which goes to pay for the group liability insurance that covers all the allotments. If we all had to pay for that ourselves we'd be paying far more than the group rate!

It'll be the membership fees that'll go up to ensure there's an emergency fund for fencing repairs etc. And all sites with water will now have to pay the bill themselves. The latter I don't have a problem with at all!

That's an interesting point about the 1908 act saying they have to replace any allotment land they "take away".