Service Charge Demand

Fitzy29

HI,

I live in an apartment where we pay £273 per quarter service charge, at present I haven't paid this quarter's due to being a bit skint. The management company have sent me four letters in the last month, the one received today basically 'pay or die' saying they have instructed solicitors etc etc..usual stuff.

The thing is it's not like i'm months and month in arrears, I'm one payment and that's it!!

Can they harras and threaten me like this, surly not?? :mad:

cattie

Yes they can & if you're not careful to pay service charges & ground rent promptly, the freeholder can take legal steps to recind your lease & claim the flat back. If you read the terms of your lease you will find something along these lines set out somewhere.

Payment of service charges is not something you can put off because you are short of money. You may be allowed a couple of weeks grace when the statement comes in, but it's something you need to budget for each month along with other regular essential bills.

Fitzy29

thanks Cattie,

the residents jointly own the freehold meaning I own 1/97th...

I also have to pay ground rent of £50 a year, so we pay ourselves rent?

Fitzy29

Just read some legals on service charges, the landlord or managing agent can't commecnce legals if you own less than £350 for less than three years!

I'm safe for now!:D

dmg24

Though Cattie is right that you need to budget for your service charge along with your other monthly bills, the threat of the lease being rescinded is a long way down the line.

The following information from https://www.lease-advice.org.uk gives more accurate information:

The final sanction for a landlord faced with a leaseholder in breach of his lease due to the failure to pay the service charges, ground rent or administration charges is to take steps to forfeit the lease and to repossess the house or flat. This is a right in law, but it is not possible to obtain possession without a court order. The process is commenced, generally, by the service of a valid notice under section 146 of the Law of Property Act 1925, the Notice of Seeking Possession.

In practice, very few landlords enforce the procedures up to the point of their gaining possession of the house or flat, but they serve the section 146 Notice as a means of enforcing a payment of arrears, or to correct a breach of a covenant of the lease. The misuse of the process in some instances has led to a significant revision of the procedures. The landlord now has to prove that a breach of a covenant or condition in the lease has occurred before he can serve a valid s146 Notice. There are also controls on the use of forfeiture to recover very small sums.

The landlord cannot serve a valid section 146 notice unless the leaseholder has agreed the arrears or that the breach has occurred or that the breach has been finally determined by a LVT or a court or under a post-dispute arbitration agreement. A determination becomes final at the end of any period provided for appeal and the landlord may not serve the section 146 notice until 14 days after that date.

Where the dispute is about arrears, the landlord must also obtain a determination from the LVT that the amount is payable, and therefore reasonable.

So, where the landlord wishes to commence forfeiture action, the steps to be taken are:

the leaseholder must agree that the breach has occurred and that any arrears are duly owing: or

the landlord must make application to the LVT for a determination that the breach has occurred; and

where the breach involves arrears, that the sum is payable and reasonable;

after the determination becomes final, the leaseholder must be allowed a further 14 days in which to resolve the breach or settle the arrears;

where, after 14 days the leaseholder has not resolved the breach, the landlord may proceed with service of the section 146 notice. This will require separate determination by the county court.

Failure to pay a small amount of charges for a short period
The landlord cannot serve a valid section 146 notice where the amount of service charges, administration charges or ground rent owed (or a combination of all of these) total less than £350, or have been outstanding for less than three years.

Of course, while forfeiture or action seeking repossession may not take place, a landlord may seek to recover monies through other means, such as the small claims court. This should not therefore be used as a means of withholding sums of money that are lawfully and reasonably payable under the terms of the lease.

dmg24

You just beat me to it, glad you've got it sorted! x

Fitzy29

Many thanks for taking the time to post that information, it's really useful.

I'm usually on time paying the charge, just at the moment i'm a little short, xmas etc. I live on my own and £273 would wipe my january budget out so it's be beans on toast every night!

It's the unforgiving letters that annoy me, as I'm usually a good payer you'd think they'd be more understanding.

Fitzy29

does anyone???????:j

clutton_2

I hope this does not sound too harsh - but if i feel a "bit skint" i expect harsh letters from my building society or my gas supplier if i have not paid my mortgage, or my gas bill, or any other bill which i am required to pay.

Why are you wanting to find ways round this, just because you find budgeting your money difficult ?

Bite the bullet, and pay up - we have all experienced Christmas, what makes you so different to anyone else when it comes to paying bills ?

silvercar

Do you have a mortgage? If so the managing agents could contact them and complain that your are not keeping to the terms of the lease. A friend of mine had this happen to her when presented with an extraordinary large bill for block repairs that she couldn't afford. The mortgage lender threatened to pay the bill and add the amount to her mortgage, along with charges, if she didn't pay the agents!

scorpio_princess

Sorry Clutton, but I think you are being a little harsh to the OP - i'm sure he/she didn't come on here to be criticised! To be fair, she never said she is refusing to pay, just that she's finding it difficult to find the money - and if you've ever lived alone on a low wage, you'll know what that's like. Welcome to my world! I'm lucky at the moment in that I'm renting so therefore not liable for service charges, but when I did own a flat many moons ago, I had to pay an extortionate service charge, which I disputed many times, for the simple reason that it was money for nothing!! I never once saw a handyman/workman the whole time I was there, despite the fact that grass and bushes were left to overgrow, the painted lines dividing the parking spaces were barely visible, and there was no lighting - pretty scary when you have to walk from a carpark surrounded by woodland!!
I'm by no way mean - if I use something, I pay for it - no problem with that. But what I do object to is paying huge fees to a management company whose office is hundreds of miles away, with no guarantee of any work being done. Nice work if you can get it!

Of course, my experience of service charges doesn't mean that all management companies are like this.

I agree with the OP that the 'overdue' letters are of a particularly threatening nature - much more full on than if you pay your gas or water bill late!

One final point - has anyone ever actually read their lease cover to cover? I know I didn't, for thesimple fact that it was written entirely in legal jargon! I would consider myself a fairly intelligent, but this was way beyond me! Which is exactly why they write them like that... or is that just me being cynical?!