Am I legally obligated to pay administration charges for Companies House Documents

emma1983_2

Hi, I am a leaseholder and I am in a tough situation with my freeholder who has appointed a managing agent to produce and submit documentation to Companies House on behalf of his property developing company. The problem is that he is charging us leaseholders for this work but surely this doesn't concern the estate where we live? I have a meeting with my freeholder in about a week's time and I would like to know exactly where I stand and whether or not he is acting against the law. I have tried Googling this subject for answers but nothing useful comes up in the search results.

I would be very grateful for any help.

Thanks, Emma

Fire_Fox

Why don't you think the work relates to your development?? Assuming the work does include your property, you need to read your long lease to see what is and is not chargeable to leaseholders. Also see here for general advice on all matters leasehold:
http://www.lease-advice.org/publications/

Doozergirl

The submission of accounts to Companies House for the business relating to a block or estate would normally be payable by the leaseholders.

Essentially, a freeholder pays for nothing. If you have accounts that have to be submitted then you should pay for that. Perhaps not the entire bill if the company includes more than ust your estate, but you should pay proportionately. It depends on how large the estate is but if you were being charged for the full accounts of his whole company, you'd know about it.

emma1983_2

The reason why I don't believe we should pay is because the work doesn't refer to maintenance of the estate although I haven't looked in my lease to see if he can impose this charge but I will do tonight. I do find the Companies House documentation charge very odd because as soon as we disputed this charge, the freeholder and the managing agent said we will not be charged for this in future but they have refused to credit us for the Companies House charges we have already paid (which is £411 split between 6 flats). I know his property developing company owns at least 10 properties so is he charging all leased properties £411 (multiplied by 10 is £4,110! For just some paperwork to be completed and submitted to Companies House?!) I have been to Citizens Advice about this and they agree with me that I should not be charged for this service. I would accept the charge for this service if we were a Right to Manage Company but because we are not I really do think this charge is unacceptable though I think its best that I am 100% sure before taking my dispute further.

Thanks for the Lease Advice link although I have already been in contact with them to arrange a mediation which the freeholder turned down.

Fire_Fox

Well done for trying to organise mediation - if you end up going to an LVT this will count in your favour. Why are you having a meeting without LEASE mediating? This doesn't seem wise unless you know the legal position and it doesn't seem like you do - it's likely they will tie you in knots and blind you with jargon.

I'm still struggling to understand exactly what this charge is, and on what basis you know it doesn't relate to your property (yet you are still being charged it). Do you have a written explanation of what this charge is for and why the freeholder has charged any of it to you? As Doozergirl says, a charge cannot legally be imposed if it is for another property entirely. Your idea about RTM is a red herring - either this charge is "reasonably incurred" (Landlord-Tenant Act 1985) or it is not.

I have found CAB next to useless in leasehold disputes, they just don't have the expertise. Read the LEASE website inside and out, get your head around your long lease, get your head around the Landlord-Tenant Act 1985 and threaten an LVT. Also speak to LEASE on the telephone before the meeting, they are absolutely brilliant.

emma1983_2

Sorry for the delay! Below is the description of the charge I received from the managing agent.

"Filing details of directors and company secretary
Maintaining the register of members
Maintaining a register of directors and company secretary
Recording directors interests
Filing statutory forms
Serving notice of the annual / extraordinary general meeting (AGM/EGM)
Filing resolutions and agreements
Supplying copies of audited accounts to members
Keeping minutes of directors and other meetings
Receiving notices of transfer and charge
Receiving stock transfer forms
Preparation and issuing share certificates
Provision of accounts to Companies House
Filing of notices with Land Registery
Arranging insurance cover and receiving policy documents
Administering the insurance policy
Helping with claims
Notifying the insurers of any mid-term adjustments
Negotiating renewal terms
Supplying information of the policy to tenants/lessees"

Like I said before, the managing agent has told us leaseholders we will not be charged for these duties in future which I find odd.

I know I'm taking a step backwards by arranging a meeting without LEASE involved but its only because the freeholder declined mediation and I haven't got the money to pay for court fees so I'm hoping we can settle the matter by ourselves. Mediation could've been a nice way to sort the problem out without it being too expensive but unfortunately I can't legally make the freeholder attend.

Thanks for your help again. I'm not really clued up on the laws so any help and advice is very much appreciated

blckbrd

If possible OP take someone to the meeting with you to take notes and then send your written understanding of the issues raised/ways forward to the MA, rather than wait for them to send you minutes.

Definitely ask why they believe you to be liable for the listed charges now and not in the future and to identify the exact clause in the lease applies. Ask them directly if any of the company related work has been charged to all properties owned by the company (incl. other developments), what the total value of charge is and how that has been apportioned.

What's listed sounds a lot like a general management fee with lots of twiddly bits added that may not fall within the definition of 'relevant costs'. I'd ask them for more detail on the headings.

Think along the lines of: In order to perform their duties in relation to the lease on my property, is X a relevant item?

If other leaseholders are also challenging the charges, you could take action at LVT together and spread the cost.

emma1983_2

I wish the other leaseholders would contribute towards court/LVT fees as well as their time. I've already been down that route and no one's prepared to act to resolve the problem but they're happy to winge about the charges. I guess they've got money to burn or that they're relying on me to sort it all out, which is the impression that I get.

I've got someone else going to the meeting with me that has nothing to do with the estate but are going to be there as a sort of witness. I learnt that from my last meeting when false promises were made by the freeholder and managing agent and the managing agent was supposed to minute the meeting but never. I'll definitely be asking those questions and fingers crossed I'll get answers!

Debt_Free_Chick

emma1983 wrote: »

Sorry for the delay! Below is the description of the charge I received from the managing agent.

"Filing details of directors and company secretary
Maintaining the register of members
Maintaining a register of directors and company secretary
Recording directors interests
Filing statutory forms
Serving notice of the annual / extraordinary general meeting (AGM/EGM)
Filing resolutions and agreements
Supplying copies of audited accounts to members
Keeping minutes of directors and other meetings
Receiving notices of transfer and charge
Receiving stock transfer forms
Preparation and issuing share certificates
Provision of accounts to Companies House
Filing of notices with Land Registery
Arranging insurance cover and receiving policy documents
Administering the insurance policy
Helping with claims
Notifying the insurers of any mid-term adjustments
Negotiating renewal terms
Supplying information of the policy to tenants/lessees"

These are the normal, routine duties of the Directors of any Ltd Company, irrespective of the line of business. It applies to the corner sweet shop as well as M&S and the company managing the freehold for your flat.

Often, these charges simply form part of the service charge and they have to be paid, in some way. But I would suggest that they are better covered by charges, rather than the (ground) rent.

These fees would be covered somewhere, wherever the freeholder uses professional advisers rather than taking the DIY route.

The principle of passing on the fees to the leasholders is not unreasonable IMHO. It is part of the "maintenance" of the estate, where the freeholder is a company as these returns have to be submitted.

You need to take a much closer look at your lease to see what charges can be levied, when and for what reason - but I would not be optimistic of successfully challenging this charge. But it really depends on the detail.