£300 penalty fee for late lease payment

mailmannz

Hi all,

Sorry if this is not the right thread but I need a little advice on how to deal with a penalty demand from my leaseholders solicitor.

Basically I was late with paying my leasehold rent of £150. I had asked the leaseholder (Homeground Management Limited) if I could make three £50 payments starting in February to clear outstanding rent.

I got no reply to me original request so I sent another several weeks later asking again if I could make staggered payments. Homeground then replied saying I couldnt because the rent was due in January (its not due in January). I asked again, pointing out they had the wrong month but they replied saying that Id have to deal with their solicitors and that I now owe them an additional £292 in collection fees.

Then yesterday I got a letter from their solicitors demanding I pay £292 immediately (ie. within the next 5 days).

BTW, I have since paid the £150 ground rent but it was after the last correspondence from Homegruond (actually, I made the pament the same day as their last correspondence with me).

Additionally there is a paragrapg in their letter that says;

"We require your payment for £292 within 5 days of the date of this letter. In default of compliance, we will arrange to issue the Proceedings referred to in our earlier correspondence and invoice our client for the same to be recharged to your account".

The letter is dated the 24th of March and was received by me on the 25th BUT I never received the earlier mentioned letter they refer to?

Also, 5 days is far too short notice for them to issue proceedings isnt it?

Additionally, I dont know what the £292 is for as they never provided a breakdown of the costs?

Secondly, assuming a large chunk of that is legal fees isnt there an issue here of being charged for work they have never actually carried out? Ie. the fee is charged immediately the payment is late so cannot actually reference any actual legal work that has been carried out. Also, wouldnt this be financial fraud? To charge me for work that has not been carried out?

Anyway, any help would be greatly apprecaited.

Regards

Mailman

bris

Pay it under protest then take them to the small claims court to recover it. In court they will have to justify it so it may very well be an unfair penalty that doesn't hold up.

If you don't pay it then the fees will keep pilling on and before you know it, it's at 2k, the 5 days they refer to will be before it goes again to the solicitors or a collection agency, where they keep adding the fees, these leasehold payments are notorious for this.

mailmannz

Hmmm...ok, Im happy with them continuing to add fees because at the end of the day they will have to justify £2000 (as you say) for the collection of £150 in the small claims court. That would seem an up hill struggle for them considering the small value of the claimed amount outstanding?

Mailman

bris

Yes, that's the other way to look at it, but you should at least write to them by recorded delivery to dispute the fees, stating you want the courts to settle this to get it on record.

This way the courts would ask why they didn't give you your day in court before any more fees (apart from court costs) were added to strengthen your position.

mailmannz

Thanks Bris, yes that was my next step was to write a rediculously detailed letter asking for a complete breakdown of the fees and disputing I owe them money (I think once in dispute it cant be referred to debt collectors too?).

Regards

Mailman

bod1467

Don't get fancy, adding unnecessary detail. Keep any letter, simple, brief and to the point.

Don't play games with this!

arcon5

I think the idea of paying under protest then pursuing them is that you don't want them to make a contra entry against your mortgage/rent/whatever account, then claimin you are in arrears.

mailmannz

arcon5,

Once in dispute then Ill have cover from this if they approach my mortgage provider.

And yes bob, thats exactly what I mean...a letter asking for details of the penalty and nothing more (please forgive my rhetorical flourish!:).

Regards

Mailman

mailmannz

Quick update, Ive had a reply back from the lawyers setting out what they are claiming for.

Also found a link to a change in the law that states that ground rents must be demanded by landlords using specific wording and supporting by set documentation otherwise people can ignore the demands

Have crafted a new letter to the clowns demanding copies of the ground rent demand that conform to the required wording etc. Now waiting for the great fob off!

Regards

Mailman

mailmannz

FYI, http://www.lease-advice.org/information/faqs/faq.asp?item=176

Regards

Mailman

mailmannz

Since demanding a copy of the ground rent demand on the proper prescribed form, along with copies of all supporting documentation over a week ago I havent heard boo from the solicitors!

Oh, I also asked them under which part of my lease do they believe they are conferred the right to levy additional service charges (like lawyer fees) and also why they believe the due date is 30 January when my lease clearly states 1 April.

Regards

Mailman