Landlords’ champion takes senior role at Lee & Priestley

Geraint Pinches has moved to Leeds-based Lee & Priestley from rival firm Gordons to lead a specialist team. Mr Pinches is seeing a growing number of cases linked to allegations of mortgage fraud, which is partly due to the property boom turning to bust.

He is leading Lee & Priestley’s five-strong dispute resolution team, and he plans to attract “high net worth” individuals and bosses of owner-managed businesses as clients.

“As times are tight, people are having to be a lot more pragmatic and commercial when considering litigation,’’ he said. “I plan to make the team bigger but the immediate plan is to build the quality of work. Back in the early to mid noughties, so-called ‘armchair investors’ were seeing the chance to make a fast buck by investing in buy to let residential properties. Then the bottom fell out of the market and some of those investors found they could no longer afford the mortgage payments if the property was vacant for a few months.”

When an investor defaults, the lender calls in the mortgage and sometimes finds that the property had been overvalued when the mortgage was applied for.

Mr Pinches added: “There were a few unscrupulous property development companies knocking around who were ‘gifting’ deposits to investors and telling them and their solicitors to keep quiet. That artificially inflated the price of the property and lenders were unwittingly lending 100 per cent LTV (loan to value) rather than, say, 80 per cent LTV. The rise in mortgage fraud was partly down to that sort of activity by the unscrupulous few, but desperation to get on the ladder may make some people less likely to be absolutely truthful when buying from a developer or a property investment company.”

According to Mr Pinches, the level of tenant insolvency has grown over the last four years because many companies don’t have enough cash flow to pay the rent.

He added: “There are, however, some tenants who use the recession as an excuse for not paying or trying to get their landlord to agree to a rent reduction or dispensation when in fact they can probably afford the rent. It’s a question of flushing those types of people out. There are some people who cannot pay; there are others who use the recession as a reason to try not to pay.”

Earlier in his career, Mr Pinches defended an importer in a case related to an alleged breach of EU registered trademarks. He recalled: “I acted for a medium-sized owner managed business which imported motorbikes into the UK from outside the EU. The business was pursued by Honda for trademark infringement and breach of parallel import legislation. It was a case brought in the High Court in London but we settled it very cheaply and long before it got to trial. It was a very good result for the client.”

According to Mr Pinches, people are generally more cautious about suing in downturn.

He added: “It is all very well obtaining judgment, but that judgment is worthless if the company which has the judgment against it does not have the means to pay. We take more time in exploring other possible methods of settlement.”