Court action threat over service charge arrears

paulkeeb

My late mother lived in a flat in a Fold Housing Association sheltered housing complex in Belfast under a 70/30 ownership scheme. She paid a monthly Service Charge for upkeep, care services etc. After her death in (January 2008) the full Charge was still payable until the flat was sold. However, Fold clearly told my sister and myself this would be taken as a lump sum in arrears out of the sale price (along with all fees etc)). The flat was put on the market in February 08 and due to the housing market downturn in Northern Ireland has been slow to sell.

Last January, with no prior warning, Fold sent me a brief letter asking me to pay the accumulated Charge - around £830. I replied by email asking for an explanation for this sudden change and pointing out that I would have a problem finding this lump sum and then over £80 a month. No reply was received. A further request for payment came in April and a further request for explanation was not answered. Last month they threatened Small Claims Court. I sent a 2 page letter to their CEO, again outlining my queries. The response once again ignored them, though did offer to let me pay £120 a month...

- I have never queried paying the back service charge (even though part of what it is for no longer applies).
- I have queried the arbitrary change on the timing of the payment... several times, but it and several other points have not been addressed.
- I have evidence in writing going back to last summer of my understanding that the accumulated charge would be taken out of the sale price. This would have been an ideal opportunity for Fold to correct me, but their reply to that letter (which was about something else) did not pick up on that point.
- The Lease says under deductions from sale price "9.1(i) such sum as may be due and owing or but for the determination of this Lease would become due to Fold in respect of service charge..."

I feel Fold are being unreasonable and hard-nosed and very selective in what they choose to respond to from my letters and emails. I've been trying to find out whether they actually have a case, but when I have made tentative inquiries for legal advice have either been told "our fee would be more than the dispute amount" or "it's Northern Ireland, we can't comment". I live in Manchester and don't qualify for legal aid (basically because I have saved hard and paid off my mortgage).

I'm now quite angry about this situation, and the amount of time I've had to devote to it (I've omitted a lot of details). Part of me is tempted to take THEM to court for harassment... but my wife would never let me!

How can I get Fold to explain why they have changed when they want the service charge paid, and how they justify it? How can I find out if they have any sort of case?

silvercar

Is the flat now part of your late mothers estate or have you inherited it?

If it is still part of her estate then Fold can wait and get the money from the sale. Though they might be impatient that they have to wait so long and go to court and get a charging order on the property. This doesn't matter as it will still come from the sale.

If you have inherited the property, then things have moved on since January 2008 and you as owner of the property are liable for the service charge.

I know this may not be what you want to hear, but the HA need the money to carry out maintenance etc. Whereas waiting a few months may be possible, waiting 18 months may not.

The second issue is why the flat hasn't sold. OK the market is tough, but you need to price realistically and sell.

paulkeeb

Thanks for your response.

>Is the flat now part of your late mothers estate or have you inherited it?

I think yes as the probate stuff has happened. What's the difference? How can I tell?

I know we're liable for Service Charge and have never questioned that. My issue is with the timing of its payment which has been arbitrarily changed from 'out of the sale price' to 'now'!

I am aware of what the HA use the money for, and 18 months is a long time, but with a surplus last year of £2.4m they're better able to withstand this arrears than I am to pay it out of pocket rather than from the sale price WHICH WAS WHAT THEY ORIGINALLY SAID! If they had said at the start something to the effect of the charge would have to be paid after say 3 months, then I could actually have sorted something out from my mum's bank account when that was released. For reasons that I cannot go into on a public forum that is now not possible.

We have asked the HA to have the flat re-valued at some 26% less than originally and there is now a potential buyer. The HA have written to say they will delay legal action for 3 months for the sale to go through and then take the charge, plus interest (first ever mention of that), but if the sale hasn't gone through by then... it's as you were. This was phrased like it was a new option being offered!!!

I've left out a lot of detail from this post and my previous, some of it stuff I can't detail here, which includes some severe communication lapses from the HA. If you want to advise me further (for which I'd be really grateful) then please contact me off the forum.

LinasPilibaitisisbatman

More than likely they just think that as it isnt sold yet the micks being taken.

silvercar

I think yes as the probate stuff has happened. What's the difference? How can I tell?

If probate has happened then you are the owner of the property, it is you that is selling it and you that owe the service charge.

If it is part of the estate, then the estate is selling the property and the service charge is owed by the estate.

Whereas the HA may have patience with a deceased person's estate (especially as they can't get blood out of a stone), if you are the new owner it is easier to chase a person.

As Linas.... says, they could just think that enough is enough.

Fire_Fox

Your OP is not clear as to how much of the communication has been in writing? Also if this is a leasehold property what does the lease/ contract say about arrears? In England at least, interest can only be charged if the terms of the lease allow.