Lawyer faces losing £1.2m Chelsea flat after it was used as a brothel for ‘transsexual prostitutes’

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A London solicitor faces losing her £1.2million apartment amid claims she failed to stop a brothel for transsexual prostitutes operating out of her property. 

Solicitor Fiorella Marchitelli has been accused of disastrously breaching the terms of the 987-lease on her exclusive Chelsea flat after a tribunal ruled there was ‘considerable circumstantial evidence’ that the property had been ‘used as a brothel’. 

Rich neighbours complained about ‘older men in suits with young girls’ walking upstairs to the flat and, at least once, female occupants of another apartment had been propositioned for sex by late-night callers, it was claimed.

Investment banker Julius Hugelshofer complained about ‘tranvestites or women dressed like prostitutes,’ in the building in Westgate Terrace, West Brompton.

Mr Hugelshofer ‘came to believe’ Ms Marchitelli’s flat was ‘occupied by a person calling themselves Natalie Ferraz, who appeared to him to be a transvestite,’ and that it was being used as a brothel, having learned of a sordid web page advertising her sexual services online.

The banker, who lived in the building during 2017 and 2018, claimed that trouble continued after Ms Ferraz moved out in January 2018 and made further complaints about ‘the prostitutes, the brothel, the noise, the dirt, the parties, the rubbish.’

This led to aristocratic heir Rupert Foley, who owns one of the flats and is sole director of the company which owns the freehold of the building, issuing proceedings through the company against Ms Marchitelli for forfeiture of her lease – essentially seeking to take possession of her flat.

Mr Foley, who is heir presumptive to the title 9th Baron Foley, claimed at the First Tier Tribunal (FTT) that by not doing enough to stop the ‘immoral activities’ taking place in her flat, Ms Marchitelli was in breach of the terms of her long lease.

The lease contains a clause compelling the leaseholder ‘not to do or permit or suffer…any illegal or immoral act or any act or thing which may be or may become a nuisance or annoyance or cause damage to… the lessors or the tenants of the lessor or the occupiers of any part of the building.’

Mr Foley claimed Ms Marchitelli was advised regularly about the activities at the flat, but persistently refused to acknowledge them or take any action to prevent them continuing.

Denying she breached the lease, Ms Marchitelli said she was seriously ill with cancer at the time, but had visited the flat on several occasions and saw nothing to suggest tenants were using it for prostitution.

After two hearings last year, the tribunal ruled that it was ‘entitled to conclude that immoral activities in breach…of the lease were being carried on’ in Ms Marchitelli’s flat, paving the way for the lease to be forfeited. 

But Ms Marchitelli has now won a rehearing of her case after successfully appealing to the Upper Tribunal and telling Judge Martin Rodger QC that she was seriously ill at the time the complaints were made.

The judge said that, although there was enough evidence to find that the flat had been used as a brothel, the tribunal had not made specific findings about what Ms Marchitelli did, or didn’t, do about it and so could not say she had breached her lease.

Setting out the nature of the complaints made about activities in the flat, the judge said Mr Hugelshofer’s evidence concerned complaints he had made to Ms Marchitelli – who let the flat through an agent – about the noise of people going up and down the staircase.

‘Eventually he came to believe that (the flat) was occupied by a person calling themselves Natalie Ferraz,’ he said.

‘Mr Hugelshofer recorded that, in the early hours of 16 December 2017, he had confronted the occupier of the flat whom he took to be Natalie Ferraz, and who appeared to him to be a transvestite. He formed the view on that occasion that the flat was being used as a brothel.

‘Mr Hugelshofer recorded in his witness statement that he had spoken to the tenants of [another flat] and that they had found material on the internet advertising Natalie Ferraz’s services as a transsexual escort.

‘Mr Hugelshofer inferred that those services were being offered at the appellant’s flat.

‘According to Mr Hugelshofer, Natalie Ferraz left the flat on January 27, 2018.

‘A few months later, in April, the flat was said to have become occupied by what Mr Hugelshofer described as “a number of different individuals, usually transvestites or women dressed like prostitutes”.’

‘He informed the appellant on April 29, 2018 and in May and June he complained to her agent…about the misbehaviour of her tenants: “the prostitutes, the brothel, the noise, the dirt, the parties, the rubbish”.’

‘When his complaints appeared not to be taken seriously by (the agent), Mr Hugelshofer again contacted the appellant, who was in hospital, informing her of a regular traffic of “older men in suits with young girls walking upstairs to your flat every day.” He asked the appellant to put pressure on her agent to change the tenants.’

The judge said the claim against Ms Marchitelli did not suggest that she herself was using the flat as a brothel, but that her tenant was doing so.

‘The complaint against the appellant was that she had refused to acknowledge what was going on in her flat or to take steps to prevent it,’ he said.

According to Mr Foley, who rents out his flat on the ground floor of the building, his two female tenants had on at least one occasion been propositioned for sex by late-night male callers, said the judge.

At the lower tribunal, Ms Marchitelli’s lawyers argued that there was insufficient evidence that the flat was used as a brothel, suggesting that Mr Hugelshofer might not have been able to tell the difference between prostitutes and students on a night out.

She had also been undergoing intensive cancer treatment at the time of the events complained of, but had visited the flat and found nothing to suggest it was used as a brothel, they claimed.

Ms Marchitelli said she had been ‘extremely vulnerable and stressed’ due to her illness, but a letter to the panel from her oncologist had not reached the tribunal before the first hearing and her health condition had not been properly taken into account.

In its ruling last year, the FTT said there was ‘circumstantial evidence that the property was being used as a brothel…or an immoral purpose,’ although that had now stopped and the tenants changed. 

Ruling on her appeal against the decision, Judge Rodger upheld the finding that the flat had been used as a brothel, but overturned the decision that she had breached her lease by not stopping it.

He said: ‘Even if the FTT was entitled to conclude on the evidence that the appellant’s flat was being used as a brothel, the FTT had not made any finding that the appellant herself had permitted that use, or suffered it to continue, and in those circumstances she could not be found to have committed a breach of covenant.’

The FTT had not found she did nothing in the face of the complaints, but did not say what ‘few active steps’ she had taken consisted of, he said.