[2023] UKUT 108 (LC)

In 2016 the freehold of Ilfracombe Holiday Park was acquired by Green Parks Holdings Limited (“GPHL”), a company now in liquidation.

GPHL granted two long leases, together comprising the whole property, to Tuscola (106) Limited, a company controlled by Mr Michael Gubbay, for whom the leases were an investment purchase.

Tuscola (106) Limited granted development leases of the property to Green Park Holdings (Ilfracombe) Limited (“GP Ilfracombe”).

GP Ilfracombe granted 273 long residential leases of units within the park, most if not all of which either required refurbishment or were to be demolished and rebuilt. 195 of those lessees are the appellants in this appeal. Some commercial units were also leased.

The long lessees then each granted sub-leases to Green Park Holidays Limited (“GP Holidays”); the idea was that GP Holidays would then sub-let the holiday units, giving the long leaseholders a guaranteed rental income for ten years. GP Holidays went into administration in 2019, and in 2020 the administrator disclaimed the underleases of the residential units, leaving the residential leaseholders in a position where if they were going to reap any rental income from their units they would have to grant holiday lets themselves. It appears that at least one of them did so, but the majority have commenced proceedings in the High Court against the freeholder and the shareholders in the freeholder, Mr Spence and Mr Kewley, seeking to have their leases rescinded for fraud.